The first regional radio contract in the State will be advertised shortly for the south-east region, and industry sources expect it to be awarded to a youth-orientated music-driven station.
A spokeswoman for the Broadcasting Commission of Ireland, formerly the Independent Radio & Television Commission, said the licensing process is due to commence in the next six to eight weeks.
The commission did not say if the licence would be granted to a youth-orientated station, but radio stations in the region are understood to be focusing on this market.
Mr Des Whelan, managing director of WLR FM, which serves Waterford city and county, said the station expects to apply, but will wait for the details of the commission's advertisement in the national press, which is the first stage of the licensing process.
Mr Whelan said he hopes a new franchise will "not interfere with the delicate local viability" of existing stations in the south east.
He said stations would be waiting for the commission's detailed advertisement, as there would be "viability questions about the franchise".
A youth station probably would not survive in Waterford alone, but may have a market across the entire region.
Mr Eamonn Buttle, managing director of South East Radio, said the station would be "genuinely interested" in applying for the licence.
He said there is no need for another general-interest station, but there is an opening for a youth station, one which he believes should be "anchored by a local station in the south east".
It would not be right, however if the franchise were to be awarded to a company outside the area, he said. It would be a "slap in the face for legal operators" if the licence was awarded to a pirate station.
Mr Willie O'Reilly, chief executive officer of Today FM, said the station "at the moment has no firm policy" on the licence. When the franchise is advertised, Today FM will examine it, "and if we feel it is of value, we will go for it".
He said a new station in an area serviced by local radio stations usually focuses more on the youth market.
One senior industry source said there would be concern about an additional service coming into the area as another competitor.
A new station will "obviously be dependent on advertising" and there are concerns it could, therefore, take advertising revenue from existing stations.
Another source pointed out that advertising revenue for radio is not growing as fast as it did in the past two years, which may make it difficult for a new operator.
A pirate station based in Waterford, ABC Power 104, will go off the air on October 29th, "in anticipation of the announcement" of the franchise, said Mr Colm Dunphy, of the station, which has been broadcasting for six years.
ABC Power 104 is targeted at the under 35s, providing a "completely different service" to others in the region, said Mr Dunphy.
He said the station is very happy with its audience research, the details of which he did not want to reveal, as the station will apply for the licence.
It was not trying to "rob listeners from other stations" in the area, he said.
The commission spokeswoman said in May 2000 that it had invited applications from stations to provide a service for an area outside Dublin and Cork.
From an analysis of the applications received, it was decided to focus on the south-east region, she said.