Sydney in 2014. Intriguing.

The news that everyone had expected was confirmed last week with ARN announcing that Kyle & Jackie O will join the soon to be renamed, and reformatted, Mix 106.5.

It is clear from the sizzle reel that 106.5, which appears almost certain to be called KIIS, will be a CHR/Pop station occupying a frontal position with 2Day and Nova 96.9.

It’s a powerful move, and one that will be likely to change the landscape of Sydney FM radio.

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There are few broadcasters who have the power to move an audience en masse and in doing so almost single-handedly influence a stations success or failure;

Kyle & Jackie unquestionably have that capacity.

It is certain that 2Day will lose significant numbers of Breakfast listeners as they follow Kyle & Jackie O to 106.5. What is less certain is how the landscape overall will play out; and the stakes are high for the (soon to be) 3 players in the CHR/Pop space.

106.5

The big winner will be 106.5.

Kyle & Jackie O is the most successful FM Breakfast show in Australia from the past 20-years, and their move to 106.5 will take that station from its current 4-share in Breakfast to double that.

The flow-on impact on overall share will be significant, and if ARN execute the brand powerfully, 106.5 is likely to be the new #1 FM station in Sydney.

The 106.5 challenge

It won’t all be smooth sailing.

106.5 will have the dominant Breakfast show, however the execution of CHR is such that it requires a deft touch; high rotation of the right songs, exciting packaging, an engaging and evolving social media strategy, killer creative promotions, daytime announcers who can execute an exciting, tight music show, a powerful drive show, an exciting nights show, and a significant and consistent investment in marketing.

It is difficult to see the current 106.5 drive show surviving into 2014, nor the 3pm show being seen as a ‘fit’ for CHR. 

The lineup, outside of Breakfast, is yet to be confirmed by ARN for 1065. However, for them to successfully launch a frontal attack on 2Day and Nova the lineup will need to be compelling, exciting and ‘on brand’ all day and into evenings.

Whilst the cume injection and ‘stickiness’ of Kyle & Jackie O will drive the success of 106.5, executing the rest of the station exceptionally will be an important ingredient for ARN to ensure 106.5 is successful.

2Day

2Day are the leading CHR and have been for some time; driven not only by Breakfast, but also because SCA do CHR extremely well. Whomever the 2014 Breakfast show is on 2Day, it will be well cast, well executed and well marketed.

Craig Bruce is sharp, and he will spend a lot of time at World Square; you can be sure that his priorities in 2014 will be 2Day breakfast, 1, 2, 3 and everything else 4. 

The 2Day challenge

That said, it’s one hell of a mountain to climb. Kyle & Jackie O on 106.5 is a “perfect storm” for 2Day.

To lose the most successful FM Breakfast show in Australia is a tough position to be in. To have them go over the road to a station occupying a frontal position strategically against 2Day is a disaster.

It is difficult to see an outcome where 2Day will not be beaten by 106.5 in 2014. A large number of the existing Kyle & Jackie O listeners will follow the show, and despite what will undoubtedly be a very good show, the new 2Day show will have to bunker down and build an audience. History often regards the heir to landmark shows poorly, so it will be tough.

In 2014, there is likely to be two objectives for 2Day from a ratings perspective; firstly to weather the ‘perfect storm’ of 106.5, retaining a platform to rebulld from and protecting the new Breakfast show from the inevitable adverse comparisons; and secondly, to remain in front of Nova 96.9.

Nova 96.9

It has been nearly three years since Nova 96.9 moved into the CHR/Pop territory. A positive for Nova is that, in the under-40 territory, they will be the only consistent station in Breakfast heading into 2014; and with Fitzy & Wippa adding 1% overall share from S1/13 to S8/13 they have been growing.

Certainly the work ethic of Fitzy & Wippa can’t be doubted, they are both extremely talented and will go hard at the opportunity.

The Nova challenge

With that consistency of talent, paradoxically lies the challenge; they will no longer be the ‘newest, freshest show’, and nor are they the juggernaut of Kyle & Jackie O; and the risk for Nova is that Fitzy & Wippa are caught between the two.

Whilst DMG would have been pleased with the news of Kyle & Jackie O leaving 2Day, they would have been unimpressed with the news that they are moving to 106.5.

Nevertheless Nova 96.9 will see this as their chance to move ahead of 2Day, and it is essential for them that they do. With 106.5 the likely #1 FM station, driven out of Breakfast, Nova will not want to be the third ranked CHR behind 2Day and 106.5.

As 106.5 move away from their Hot AC position dmg would be hoping to pick up some disenfranchised older females on Smooth; which is where WSFM comes into play.

WSFM

Notwithstanding the fact that 40+ females are quite comfortable listening to a well put together CHR with a strong Breakfast offering, the move of 106.5 younger, will provide an opportunity for Smooth to grow further.

ARN will know this, and strategically it is likely that they will evolve WSFM to minimise any opportunity for Smooth.

Does that mean some recurrent material? Does it mean a slight softening? Does it mean a refinement of the era mix? Is TRN’s Classic Hits a model that may be looked at?

ARN have at this point been silent on any WSFM changes, but with the best adult Breakfast show in Sydney in ‘Jonesy & Amanda’, there is no question that they will leverage that station, and evolve it, to try to ensure any disenfranchised Mix listeners end up on WSFM.

The Edge

ARN’s third Sydney station is The Edge. Duncan Campbell is on the record telling Radio Today’s Mark Hales (here) that the station will not change format. Which means four CHR’s in Sydney.

Smart move? Or missed opportunity to act as a spoiler? 

Smart. Here’s why.

Should it eventuate that 106.5 becomes a dominant #1 FM overall, it is hard to see both Nova and 2Day each having saleable ratings, and one is likely to have to reposition. A potential space would be for the weakest station, when forced by ratings pressure, to move to a younger, rhythmic CHR position, flanking the other two.

With The Edge in this format, it is a more challenging proposition for another station to move into the rhythmic CHR format as they would share the audience; essentially a niche within a niche. 

Forget the fact that The Edge is not rated, they do take listeners out of the Sydney market, and in the ‘listener world’ they are a genuine alternative.

Therefore The Edge remaining in it’s rhythmic CHR position is ‘insurance’ for 106.5  by making any repositioning to that flanking format by either Nova or 2Day a more challenging proposition.

Summary

Sydney will be fascinating to watch in 2014. The ARN move is a powerful and bold statement of intent.

Whilst the publicity line used by Ciaran Davis and Duncan Campbell that “we now have the two best Breakfast shows in the market” may be a bit of rallying the troops, it is also true. They now have the best Adult FM Breakfast show in the country, and the best CHR Breakfast show in the country; both in Sydney.

Strategically, if you are to engage in a frontal battle, you need to have the strongest Breakfast show, and the deepest pockets. You also need to be able to execute the strategy exceptionally. No doubt ARN are having long discussions and planning sessions for this across summer.

For the rest of us, we grab some popcorn and a drink, sit back and watch the show.