GCap are in the midst of announcing that the new Chief Executive of GCap is to be Fru Hazlitt (ex CE of Virgin Radio and Yahoo UK). It's going to be quite a change in style for GCap which loses Ralph Bernard as it's number one. It will also no doubt kick off a management re-shuffle at the company, as the other two CE candidates – Steve Orchard and Wendy Pallot – try to work out what position (if any) they can retain in the organisation. They'll also be the happy knock-on to other management as they try and work out whether their strategies are likely to be supported by the new boss.

Top on Fru's agenda has to be 'sorting out' digital. GCap's had virtually no digital strategy over the past 12 months as it tries to work out what it will do with the capacity it owns. The one thing it has been good at is moaning that it's all too expensive. In reality, of course, the income from the multiplexes that it owns virtually covers the carriage costs of all its services meaning that the only costs it incurs are actually the programming ones. Which, means of course that there isn't actually a DAB problem per se, it's a making money from new types of radio problem.

This is actually a much bigger problem for a group like GCap. Existing incomes will naturally decline as FM reaches maturity, what they need to do is work hard to generate new revenue from new products. So far, they've been pushing online and the websites hard, which is starting to generate new revenue, but from a massive increase in costs. In good news, the GMG contract will bring new money and even more scale to the group which will help the bottom line.

I think the challenge for Fru will be to ensure that this (and other) cash can consistently flow into the new product areas whilst battling the City who are after this money to be channeled to shareholders.

In the short term this will probably mean more cost control in the existing business and the development team going hell for leather to sell more capacity across its multiplex networks. They're already taking off Chill's and other stations where they know they can get a paying customer on, i'd expect this to continue at pace over the next few months.

Disclosure: I often bid against GCap for contracts and work with them on some projects!

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