Simon Cole: 'The radio industry is changing at a speed that's hard to keep up with'

8am

Simon Cole arrives, by Tube from his flat in Notting Hill, west London, to have breakfast with a fund manager at Standard Life. The venue is a favourite of his, The Wolseley, the place to be seen on Piccadilly.

Standard Life has just upped its stake in UBC Media to more than 6 per cent. Last week the company, which specialises in digital radio, made a major announcement on its most exciting business, a gizmo that allows radio listeners to download the track they have just heard being played.

The company announced that the service should come to market before the end of this year. Investors want to know more.

Mr Cole, the founder and chief executive of UBC, reckons he spends about one-fifth of his time dealing with investors. That's unusually high, he concedes, but does not resent it. He points out that UBC has been a loss-making company " by design" and, as such, he "owes" it to shareholders to keep them informed.

"If you're running a fish and chip shop, people know how it works. But if you're a company like us, telling people to believe in the future, doing lots of innovative things, you [as an investor] could get nervous about it," he says.

Mr Cole used to "do" lunch a lot, as media types are wont to, but says it wasted too much time, so he has become a big fan of breakfast. "Lunch is really a one-hour meeting that takes two hours, so that's a wasted hour."

9.30am

Arrives at a seminar at Ofcom, the media regulator, where the industry has gathered to discuss the licensing of spectrum (radio frequencies).

He says the one room contained the past of radio - guys who run a single local FM station - and those, like him, who have no interest in traditional analogue radio.

They are shown a new radio, which can pick up any digital radio station or any station being broadcast over the internet (via wi-fi).

"People saw that device either as a challenge or an opportunity," Mr Cole says. He falls into the latter camp, of course, as the radio can use his new downloading service.

He says he feels guilty as he and Virgin Radio's Fru Hazlitt rather monopolised the seminar. "We were evangelising, telling people to wake up and smell the coffee."

12.30pm

Arrives at UBC's offices, which are in a rather functional little block near Marylebone station. The company is having a charity fund-raising event. Staff are selling hot-cross buns, with butter and jam, to raise money. Mr Cole buys two for £10, and spends half an hour with colleagues in reception while they eat them. He says that events such as this encourage "team spirit", a quality that is crucial for a small entrepreneurial company like UBC.

Mr Cole, 48, has been in the radio industry his whole career, starting as far back as the sixth form, when he had a Saturday job at BBC Radio Blackburn, and admits that he was a "precocious" boy, even making it to becoming a presenter. He worked at BBC Manchester while he studied drama at the city's university (contemporaries on the course included Rik Mayall and Ben Elton).

After university, in the early 1980s, he joined Manchester's leading commercial radio station, Piccadilly, where he rose to become programme director.

Then, suddenly in 1989 Owen Oyston (the businessman who was later convicted of rape) launched a bid for Piccadilly, the first hostile bid in the radio sector, and succeeded.

Mr Cole resigned immediately and set up UBC, with his partner, Tim Blackmore (the company's editorial director).

"He is without doubt the single most important influence in my business life. We have worked together for 17 years and we have yet to have an argument, but we probably wouldn't choose each other as next-door neighbours."

They had spotted that there is a market for network programming for commercial radio - the same shows that can be broadcast on local stations across the country. The innovation came in getting the programmes sponsored, so they could be provided for free to the stations.

UBC provided the commercial sector's first network pop music chart show. It now supplies the industry with traffic, travel and news, for instance, with the network business providing turnover of £12m and an expected profit of £1.2m this year. That has to be balanced against the digital business, which is in the investment phase. Analysts forecast that UBC as a group will break even this year.

UBC listed in 2000, to raise cash, after it saw that digital would "reshape the business model" in the radio industry.

1pm

Mr Cole meets with the team working on the download service. The company is about to launch a trial in Sutton Coldfield and he is very keen to be kept up-to-date with all the detail - technical issues, strategic issues and progress with partnerships. They brief Mr Cole on licensing arrangements with the five major music companies.

He says by 2010, revenues from downloaded music could be as large for the radio industry as the entire advertising revenues that it currently lives off.

2pm

To take the download to the point of launch, UBC is having to recruit more team members. Mr Cole meets with a headhunter to discuss hiring someone to head up the business.

"The most difficult thing to find are individuals with the self-starter ability to make things happen."

3pm

Deals with e-mails (though he already had a quick stab from home first thing) and returns calls. "E-mail is a fantastic tool but if they get out of control, they become the enemy. I hate not responding to people's e-mails promptly."

5pm

Unlike analogue radio, digital radio needs software, and UBC has a business producing it - Mr Cole describes it as a "hidden gem" within the group.

Mr Cole believes in letting those who head UBC's divisions run their units as their own businesses. However, the head of the software unit is on business in South Korea, which means he won't be able to attend a trade exhibition in Las Vegas where UBC's software, through its partnership with the US player Harris Corporation, will be launching its product in the country. So Mr Cole will be going instead. He does a conference call with his guy in Korea and someone from Harris, to discuss what he will be doing in Vegas.

The US is behind the UK in digital radio but it is developing very fast, Mr Cole says. "The opportunity for this company is huge internationally." He leaves at 6pm.

8pm

Mr Cole, who has never married, lives in a "nice" flat in trendy Notting Hill but it is only a one-bedroom place. His partner, Sara, lives with her daughter in Pimlico. The three of them drive up to Oxfordshire, where Mr Cole has another home. He does not enjoy living in London, which, he says, is too polluted and filled with people who are rude, and gets away to the countryside as much as he can.

They are meeting up for dinner in a restaurant with Ralph Bernard, the chief executive of GCap Media, his wife and one of his daughters. Mr Cole has known Mr Bernard, who also has a weekend retreat nearby, for years. They are allowed to discuss business only briefly by their other halves. "Ralph always says to me that 'you promised the City [in the flotation prospectus] that you'd lose money and that's exactly what you've achieved'."

In the City's eyes however, it is GCap that is seen to be in deep trouble, with rapidly shrinking audiences and advertising revenues. Mr Cole says: "GCap is run by people who are immensely talented in radio. The trouble for them is that they are trying to turn a super-tanker, while the business model is changing at a speed that's very hard to keep up with.

"Their problem is not that they're running the business model badly, but the wheels are coming off the [analogue radio] business model."