Monday 3 September 2018

Evans

It’s been some morning in uk radio. The news that Chris Evans is departing BBC R2, the UKs biggest radio station by some margin, for the digital-only Virgin Radio really has sent shock waves through the broadcasting establishment.

Others including Matt Deegan and John Myers have looked at the implications for Evans himself, and R2.

If I may, let me just focus my thoughts on my area of expertise - the financial implications for News UK/Wireless Group with this huge and risky play.

I have no inside knowledge of Chris’s offer from Virgin, but let me guess at £3m p.a.. He was on nearly £2m at the BBC before being asked to take a cut recently, and will certainly have wanted, in making this move, to have proved his commercial value.

Let’s also assume a one-off £10m to launch and promote the show in a significant, credible fashion across the U.K., on top of guaranteed cross-promotion on News UK titles.

Let's also assume this is a 5 year play.

I’ll also assume generic ongoing production and marketing will add up to £2m p.a. over the five years

Add in another £1m p.a. to hire two or three additional big names for the station - Chris followed by people no one's heard of won't work (X is a good example, where the signing of Moyles was well backed up through the day).

So £6m p.a. additional investment for 5 years - that’s £30m.

This means in total a £40m investment including that large launch campaign.

[And this is on top of TX costs of c £1m p.a. and other backroom costs (such as sales, which I'll get to in a minute)]

You’d want your station to be worth £100m-£120m in 5 years to justify that. Normally risky ventures need to demonstrate at least a 3 x money return for investors - and I doubt News UK will have vastly different metrics.

That would mean sustainable profits of £8m-£10m will be needed by that point.

Given ongoing costs of £6m-£7m, that means you need revenues of £20m or so.

That £20m would be offset by 10% royalties, and, say 15% in terms of sales costs, so you'd be left with £15m. Take off the £7m in costs and you are left with an £8m profit on £20m sales. That's a very healthy 40% profit margin - normally an excellent return for a radio brand.

So £20m in revenues just about gets you to a profit which can justify the investment.

That £20m is about 5% of total uk national radio advertising (or it will be in 5 or so years time).

So you’ll need around 5% of Commercial Radio audiences to achieve that. Normally I'd argue you'd need more, because the big battalions from Global and Bauer (Heart, Kiss, Capital, City Network) will take an unfair share - but even though News/Wireless are some way behind Global and Bauer at No. 3, Chris himself will command an offsetting premium - so 5% is a good benchmark.

That’s 25m hours - which is roughly 4m listeners listening for 6 hours per week.

I think Chris will get his listeners to stick with him, so 6 hours a week is more than possible. BBC 6 Music gets 10, and X network gets 8 - but they are in a less competitive bit of the market for music, whereas Virgin with Chris will clearly be mainstream, going up against Heart, Magic, Smooth, Capital, Kiss and their digital offshoots, and they all cluster around 5-6 hours per listener per week.

4m listeners though, with no FM presence, just DAB and online.

The best digital-only station today is BBC 6 Music, which has just over 2.4m. The best digital-only  commercial station, Kisstory, has 2m. X network, which is a bit of a Hybrid, gets 1.7m, but a chunk of them are on FM in London and Manchester. Another hybrid, Absolute Radio (the main AM/DAB brand, which is also on FM in London and the Midlands) gets 2.5m.

But I'd think if anyone can break through this middling 2-2.5m listeners onto the ground occupied by the major hybrid FM/DAB networks, Chris can. Particularly if he's backed by a big, sustained marketing campaign (and lots of cross-promotion in The Sun etc).

So the numbers can be made to work - but it's undoubtedly the biggest pure-play brand development gamble taken in UK radio since the original nationals (Classic, Talk and Virgin (sic)) launched 25 years ago.

It'll be great to watch it play out.


Saturday 18 August 2018

Carb Wars

Here's another in an occasional series of blog posts on matters of health, fitness and longevity, a subject I explored in detail in my book "The Life of Riley"

The Lancet, one of the world's leading medical journals, in a sub-publication on Public Health, published a report this week claiming there were life shortening effects of eating too few, or too many, carbs, and how plant based fats and proteins were superior to animal fat and protein in extending lifespans if you were unfortunate enough to be eating too few carbs to begin with. You can read the study here.

This study has gained a significant amount of press coverage, essentially saying it's safe to eat a significant proportion of your diet as carbs again (50% is the suggestion), and that we shouldn't adopt a low carb/high fat approach to eating, and should replace meat with more plant foods, if we want to live longer.

I've looked at an awful lot of scientific studies over the last few years which have suggested eating too many carbs is not good for you, leading to insulin resistance and then weight gain, and listened to a lot of folk who have embarked upon a lifestyle which has reduced their carb intake in order to successfully lose weight and in some cases combat the effects of type 2 diabetes, and I have to say this latest study seemed to pull the rug from under that approach.

Except...having read it, I'm a little dubious about the basis for its findings. 

The main study (the scientists also added in other studies but didn't give specific details on them in the report linked to above) was of just over 15,000 adults in the US. These folk were asked to fill out a food diary when they enrolled in the study in the late 1980s, and then again in the early to mid-90s (1993-1995). Around 20 years later (by 2013) the authors analysed who had died out of this cohort (about 6,000 out of the original 15,000), and from that produced a risk ratio for various levels of carbohydrate consumption, having split the participants into five groups, with the lowest fifth eating just 37% of their calories as carbs, and with the highest fifth eating 61% of their calories as carbs.

However, this 2013 mortality analysis was based entirely on what these people were claiming to have eaten 20-25 years earlier! No food intake questionnaire was undertaken after 1995. This seems like a significant omission. I certainly don't eat today what I ate 25 years ago, and I think knowledge of healthy eating has advanced markedly in the last two to three decades, irrespective of the percentage of intake you have as carbs or protein or fat. So for all of these study participants, some tracking over a longer time period of changes in dietary habits would seem like a pre-requisite before pronouncing on what is likely to kill you sooner rather than later.

Just to confirm this point, anyone who, between survey one in the late 80s and survey 2 in the early 90s, had already succumbed to heart disease, diabetes or stroke was removed from the study. This was done, the authors said, to eliminate the possibility that these people would change their diet following these illnesses and therefore skew the results. The implication of this of course, is their belief that those who remained in the study would not change their dietary habits. But, as the authors themselves said "....Another limitation of this study is that diet was only assessed at two time intervals, spanning a 6-year period, and dietary patterns could change during 25 years....."

Looking at the data for the participants, it is worth noting that their average age at the start of the study was 54, with a mean BMI of around 27.7. In fact the group with the lowest carb intake at the start of the study had the highest mean BMI at 28, with the highest carb group having the lowest BMI at 27.4.  Interestingly, on average, the study participants put on around 1 point in BMI between the first and second questionnaire, to 28.7. In addition, 70% of this initial low carb group were current or former smokers, vs 51% for the highest carb group, and had the lowest levels of physical exercise measured at just 15% being active, vs 20% for the highest carb group. It almost seems like the low carb group started out as the unhealthiest...and perhaps stayed that way?

The description of this low carb  group in the report itself bears repeating here "....Participants who consumed a relatively low percentage of total energy from carbohydrates ....... were more likely to be young, male, a self-reported race other than black, college graduates, have high body-mass index, exercise less during leisure time, have high household income, smoke cigarettes, and have diabetes...."  This profile of unhealthy, overweight ex or current smokers and potential diabetics, is nothing like that which you would attach to those who have chosen to live a low carb lifestyle today - all of whom know how important physical exercise and maintaining a lean body weight is as part of their approach to life.

The other significant query I have with this study relates again to the initial questionnaire, which was used to produce a data point, recorded in the main table, showing that the "mean" calorific intake recorded for all participants in the late 1980s was around 1,600 calories per day for all of the groups from low carb to high carb. 

I would say 1,600 calories is very, very low - being 600-700 calories below recommended levels for weight maintenance. The recommended level of calorie intake for an adult in the UK is 2,000 for a woman and 2,500 for a man (NHS data here) so a population average of 2,250. Mainstream nutritional advice is to bring calorie levels per day down by around 500 from this figure to lose weight, and although I'm not convinced that is great advice per se, I don't think anyone in the mainstream of this debate would go round suggesting that it is healthy or that people can cope for long only eating 1,600 calories. So these participants, who had a mean BMI of 27.7 (i.e. already quite overweight) were eating 30% fewer calories each day than recommended for normal folk - and six years later had managed to put on a point in their BMI! This 1,600 calories per day figure just doesn't seem right to me. We already know from alcohol studies that people under-report their drinking to a significant degree - perhaps people also under-report their eating - particularly of foods which they think are unhealthy?

Something was definitely not right with the questionnaire - or rather the responses to it. If people were either deliberately or accidentally not telling the researchers what they were eating, and specifically their total amount of consumption, how can we really know what % of their diet was carb vs fat vs protein etc?

I'd also really like to know what constituted animal fat and protein for these people - was it grilled steaks at home with a salad, or fast food burgers in a bun with french fries at a greasy spoon?

The study goes on to discuss animal vs plant protein & fats for this low carb group, and how more plant and less animal helps ameliorate some of the claimed negative effects of the carb reduction. However, as I am quite skeptical about the whole study, this element seems more than a step too far, trying to unpick second order effects on what started out as an investigation into carbs v protein v fat in general.  

If this 15,000 study were representative of the US population as a whole, I doubt many of them were at all aware of the benefits of particular structured diets back in the 80s when their food habits were being examined. Throwing that lack of knowledge forward 25 years, to castigate a particular approach to diet today, seems to me at least to be a stretch.

Another recent study, published last year also in The Lancet, and based again on validated food frequency questionnaires on 135,000 individuals enrolled from 2003-2013, concluded that "......High carbohydrate intake was associated with higher risk of total mortality, whereas total fat and individual types of fat were related to lower total mortality. Total fat and types of fat were not associated with cardiovascular disease, myocardial infarction, or cardiovascular disease mortality, whereas saturated fat had an inverse association with stroke. Global dietary guidelines should be reconsidered in light of these findings....." 

In this study, levels of mortality rose throughout the carbohydrate groups from lowest to highest (the bands were a little higher overall here, with the low group eating 46%, and the high group 77% of their food as carbs) and fats from animals (saturated fats mainly come from dairy, fatty meats etc) appeared to be beneficial. Quite a different set of conclusions - although high carb was definitely bad for longevity in both studies. 

Talk to anyone pursuing a considered Low Carb / High Fat approach today (including those who are Keto or full carnivore), and their animal intake will be fresh meat, fresh fish, all well cooked, and with plenty of veg (for most), and using mostly olive oil or coconut oil for cooking and dressings. Many will supplement this with nuts, and some (like me) who are just plain "low carb" will try to ensure they eat fewer carbs overall, and their carbs are mainly whole grain or low GI as a matter of choice. I suspect this is a long, long way from the dietary habits of those people who initially started in the low carb group in this study, and I'm not convinced therefore this most recent study has much to offer in terms of dietary advice today, except to confirm really high levels of carbs are not good for you.


Sunday 15 April 2018

Spin the bottle

I've not blogged or written about health for some time, since the publication of my book "The Life of Riley", but the coverage generated by the research on safe levels of drinking, published this week (link here)  produced some wild headlines across the press, warning of the dangers of demon drink. My interest in health, combined with my knowledge of the workings of the press, and some rudimentary graduate level stats knowledge, were all piqued by this.

And yet the analysis done actually seems to me to give moderate (and even slightly heavier than moderate) levels of drinking a pretty reasonable bill of health, and overall was much in line with lots of previous research (much of which I referenced in my book), which most people vaguely interested will recall as suggesting moderate drinking was not only safe, but seemed to be beneficial for health.

How is this possible?

Well the report itself was a meta analysis of a number of previous studies, merging 600,000 respondents over many years into a giant database for analysis. A good approach, and one which normally removes the wrinkles and oddities found in smaller pieces of research.

Where this report differs from many previous meta-analyses is the base population it was measuring and comparing. Most previous research has looked at the population as a whole, both drinkers and non-drinkers, in order to compare rates of mortality (i.e. how long we’ve got left, on average, given our age, sex, lifestyles etc.)

This analysis however only compared mortality rates of all current drinkers, using those who drank, but drank the least, as the base line (so giving them an index of 1). These people drank between 0-50 grams of alcohol per week. A standard bottle of wine has around 80 grams, and you can get 4 decent, medium sized glasses from a bottle - so this control group were drinking under 3 medium sized glasses of wine per week ( I’m just going to use glasses of wine for this analysis, but the comparisons hold true for beer etc, just with different volumes).

This base line group were then compared to folk who drank 50-100 grams, 100-150 grams, 150-250 grams, 250-350 grams and 350 grams+ each week (although the groups were split differently in the text, tables and graphs, for no obvious reason, which is unhelpful when trying to analyse and critique).

However, in the report's text the authors have merged the two lighter drinking groups (0-50 grams and 50-100 grams) into just one 0-100 grams group as there appeared to be little difference in mortality rates between them (although see below for the raw data) - so this larger base are those people who only drink up to 5-6 glasses of wine per week, with an average of around 3 glasses. These are deemed the least at risk and provide the base level of risk used to compare other groups to. For reference lets call this group “light drinkers 1 & 2”

Those in the group that drink 100-200 grams (so up to 10 glasses of wine per week or 2 1/2 bottles) were slightly more at risk, and estimates were that a 40 year old who drank at this level would lose around 6 months of life compared to the light drinkers. But this is over the remainder of his/her life, which might reasonably be expected to be 45-50 years - so maybe a 1% reduction overall. This hardly seems worth worrying about in my view. 200 grams per week represents 25 units in UK drinking jargon, which is of course way over the current suggested limit of 14 units per week for both men and women, despite this apparently relatively trivial level of increased risk. Lets call these people “moderate drinkers 1 & 2” as the data splits them into two groups.

Those drinking 200-350 grams had a worse life expectancy. In the middle of this band at around 275 grams you’d be drinking 3 1/2 bottles of wine a week (or half a bottle = 2 medium glasses a night), but at age 40, if you continued to drink at this level, the suggestion is you would lose 1-2 years of life compared to the lightest drinkers. This is a 3% reduction and, doing a bit of maths, I think this is where that “each drink takes 30 minutes off your life” headline reported in the press comes from (11 extra drinks per week at 30 minutes lost each drink over 50 years knocks off 1.6 years). Let’s call this group “regular drinkers”.

Those drinking over 350 grams, heavy drinkers, who are nudging a bottle of wine a night, every night (or more) had a 4-5 year loss of life in comparison - so around a 10% reduction. That sort of reduction ought not to be dismissed, and no one sensible could be shocked to discover that knocking back that much booze every night for your entire adult life might carry some significant elevated risk of illness or disease.

But, the confounding factor in this research is the absence of those who simply don’t drink - not former drinkers who may have given up for health reasons, but those who simply don’t like the taste, or who don’t imbibe for religious or other non health related factors.

These people also lived with much higher mortality risk than our super-light drinkers - a risk pretty comparable with those in the second highest drinking group, our “regular drinkers”, those drinking up to 3 1/2 bottles a week (or roughly half a bottle per night).

I understand why the researchers did some analysis excluding non-drinkers, as they do seem to be different in their overall make up. As the researchers stated “...  However, we observed notable differences in baseline characteristics between never drinkers and current drinkers (eg, in relation to sex, ethnicity, smoking, and diabetes status.....”.  However, to then only make comparisons of death rates, and years lost amongst the drinking sub-group, without also highlighting the flip side of years lost by not drinking at all, seems slightly disingenuous, knowing how the press are likely to end up reporting the paper. The data on non-drinkers is only to be found in the appendices - and no reporter, rushing for a deadline, is going to pore over the minutiae of the report in this fashion. In this sense I think the tone of the main summary, and the subsequent reporting, could be considered somewhat misleading for the layman.

In fact, all levels of drinking up to around 1/2 a bottle per night (so both light and moderate) seemed to provide much lower risk than either not drinking at all or being a regular or heavy drinker.

You’d have to say, looking at the data, that non-drinkers are doing themselves a huge disservice by their restraint, and arguably should be holding their noses two or three times a week and knocking a glass back! But no one in the public health sphere could or would ever say this of course.

In reading the report, I was interested to note the amount of “heavy lifting” being done by the weighting applied to each group. This is where the researchers apply greater weight to, say, female respondents if there are fewer than the number expected within a group, or upweight or downright particular ethnicities or age groups, so as to produce a revised sample more in line with the population as a whole (or balance for smokers, or the obese etc.). This is a perfectly sensible thing to do, but as a man who has been a professional user of weighted statistics for 30 years, with his livelihood dependent upon their accuracy (RAJAR anyone?) I can tell you weighting can produce some strange effects.

Just to show how much effect the weighting had, here is a simple table of the raw data on how many people had died in each group when they were all recontacted, around 8 years later.

Non Drinkers (53,851) 10.7%
V Light Drinkers (177,956) 8.1%
Light drinkers (128,094) 6.0%
Moderate 1 (94,653) 6.0%
Moderate 2 (94,760) 5.9%
Regular (52,020) 6.7%
Heavy drinkers (52,429) 8.4%

Just looking at the raw data, its those at the top end of the moderate banding who were least likely to die, and in fact the very light drinkers had one of the worst mortality rates! And lo and behold it is non-drinkers who were dying off the quickest - much quicker even than heavy drinkers. This is just the raw data though, and I fully accept it needs to be weighted, but intuitively you can see the weighting has had some dramatic effects.

One piece of weighting they didn’t do, and which I’d have liked to see, is a stratification by weight. I’m a pretty tall, lean guy, but I weigh nearly 100 Kg. A small, lean woman could easily weigh only 50Kg. We can’t both surely have the same tolerance for alcohol though, as it must, as a drug, be in some way dose-dependent. Therefore sorting mortality rates by alcohol consumed per Kg of body weight might have produced some interesting findings (the researchers must have had the data, as they had BMI numbers). This is one reason why having no difference in guideline limits between men and women in the UK seems so odd, given different levels of typical body mass (we are alone in the western world in doing this).

Apart from ignoring non-drinkers in their presentation of relative risk and levels of mortality, another concern I have with any alcohol related studies is a point acknowledged by the researchers themselves in this one, who state

 “........Nevertheless, our study has some potential limitations. Self-reported alcohol consumption data are prone to bias and are challenging to harmonise across studies conducted over different time periods that used varying instruments and methods to record such data.....”

This is of course a scientific way of saying that people habitually lie about their levels of drinking or simply can’t recall it accurately and on average are prone to significantly under report. In fact numerous comparisons of actual sales data and reported levels of drinking show significant gaps between what respondents were actually drinking and what they were letting on to. The ONS itself, in its latest alcohol drinking habits report here states “It is likely that the data reported here underestimate drinking levels to some extent. Social surveys consistently produce estimates of alcohol consumption that are lower than the levels indicated by alcohol sales data. This is likely to be because people either consciously or unconsciously underestimate their alcohol consumption.” 

Far be it for me to be ultra critical or cynical about the data in this most recent analysis, but of the 600,000 drinkers in the sample, fully 300,000 of them claimed to drink on average just 3 glasses of wine (or the equivalent) each week. Really? Half of all drinkers only drink 3 glasses a week? I must be mixing with the wrong crowd.

I doubt the heavy drinkers are capable of much under-reporting given how much they are already admitting to drinking (and there are only a few of them any way, less than 10% of the total), so it must be the light, moderate and regular drinkers who are under-reporting, and it seems to me all of the “drinks per week” discussed above are some way below the reality for most people.

The final query I’d have is why choose age 40 as the baseline point to reference years lost etc?

Clearly one reference point is better than 2 or 3 - but I doubt today's millennials will care much what happens to 40 year olds, and 40 year olds are, I suspect, by and large too busy worrying about jobs, kids, mortgages etc to care too much about what will happen to them when they are 80 or 85. It’s curious too, because the average age of the respondents in the surveys merged for this analysis was 57, so there was some more heavy statistical lifting involved in then “back dating” the results to produce the age 40 estimates. It’s also odd because this late 50s/early 60s cohort is the group that public health officials tell us they are most worried about.

The ONS has a great life expectancy model on its website here, and this forecasts that a typical 57 year old will live for around another 30 years (women 31, men 28).

Using this figure of 30 years longer to live at age 57 as a benchmark, and using 30 minutes lost for every drink per week for each excess drink consumed over the light drinkers, this is what happens when you crunch the data:


Non Light Mod 1 Mod 2 regular heavy all
Number in sample 53851 306050 94653 94760 52020 52429 653763
age 58 57.2 57.4 57.2 56.6 56.4 57.2
mean units per week
6 16 25 38 69
drinks per week (@ 2.5 units per drink) 3 6 10 15 28
excess over light drinkers 0 4 8 13 25
minutes lost per year -19500 0 -5850 -11700 -19500 -39000
months lost over 30 years -13.5 0.0 -4.1 -8.1 -13.5 -27.1
Years lost compared to light drinkers -1.1 0.0 -0.3 -0.7 -1.1 -2.3
Predicted mean age of death 86.4 87.5 87.2 86.8 86.4 85.2 87.0
Years lost compared to average (mean)  -0.6 0.5 0.2 -0.2 -0.6 -1.7
non-drinkers given same excess as regular drinkers as all-cause mortality rates are virtually identical

So the light drinkers get an extra six months over the average, whilst some moderate drinkers lose a couple of months, regular drinkers are 7-8 months off the average, and even heavy drinkers are under two years below average. Obviously if damage has already been done by prior excess consumption, then that will affect mortality going forward - but most folk looking at this study will probably shrug their shoulders about past indiscretions, saying "what's done is done"

Like many of my friends I am in my late 50s. If our likely life expectancy is another 30 years or so, then the light and moderate drinkers in the group appear fine, and even for the regular drinkers, if every night spent drinking half a bottle of wine lops 7 months or so off the average life expectancy compared to our cohort, I suspect many people would think that’s a trade off worth making.