Two groups are in the running for a multi-city licence, which provides an opportunity to target the lucrative 'silver euro' market, writes Ciarán Hancock

Englishman Martin Block might not be a big fan of football, but he admits to feeling like a player counting down the days to the FA Cup final at Wembley.

On Monday, Block's 4FM consortium goes head-to-head with TV3 in a winner takes all clash for a multi-city radio licence at an oral hearing in Dublin's Conrad Hotel. "It'll be like a cup final; it's a one-off and anything can happen," Block says.

If Paddy Power was running a book on the clash, which is expected to attract a full house, then Block and 4FM would probably be the slight favourite.

Block has good form, with 25 years' experience in radio here and in Britain. He was a founder and former chief executive of Lite FM, which was sold to UTV at the turn of the decade.

4FM's other backers include Vienna Investments, which comprises the former owners of FM104; Bay Broadcasting, which has operated temporary radio licences in the past; The Irish Times Ltd and Thomas Crosbie Holdings, publisher of the Irish Examiner and a shareholder in three commercial radio stations.

Two and a half years ago, Block made a submission to the Broadcasting Commission of Ireland (BCI) that was to form the basis for the regulator's decision to seek applications for a multi-city licence for over-45s. Block, his brother Howard and business partner Al Dunne made about €1.8 million between them from the sale of Lite. They are now proposing to invest a similar amount in 4FM. While others might kick back and enjoy the windfall, Block can't wait to get back into the saddle.

"I've spent the past three to four years trying to get back into the business in some fashion," he says. "Radio is part of my life and I miss it badly."

The favourites tag doesn't sit easily on his shoulders. "TV3 are a very good outfit and we won't be taking them lightly," he says.

For its part, TV3 is itching to enter the radio market. "This is important to us," says TV3 chief executive, David McRedmond. "We really want the opportunity to build this multi-city brand."

Ten years after hitting the airwaves, TV3 has established a 12.8 per cent share of the television market here and is highly profitable. It recently secured live rights to the GAA's All-Ireland championships for the first time, breaking RTÉ's monopoly.

Owned by UK private-equity group Doughty Hanson, TV3 is keen to expand its interests. In the summer, it tried to buy Emap's Irish radio stations, but lost out to Denis O'Brien. It was also in the mix recently to buy FM104, but the bidding was too rich for its blood.

McRedmond says winning this licence would be a better entry point for the station. "We prefer to be masters of our own destiny," he says. "An acquisition is always a possibility, but creating from scratch is something we have done with TV; it's in our DNA."

The prize at stake is a 10-year contract to run a radio station for over-45s serving Dublin, Cork, Limerick and Galway cities and Co Clare. That represents about two-thirds of the population.

It's a market that RTÉ Radio One has largely to itself, earning an estimated €40 million in advertising revenue. Both players believe there's a gap to be exploited. 4FM has secured €9.1 million in funding. Its backers are projecting revenues of €2.2 million in year one, rising to €4.4 million by year three. It expects to make a profit in year four, by which time it will have accumulated losses of €5.5 million.

TV3 is more aggressive in its financial targets. Backed by €10.7 million in funding, it is projecting revenues of €2.9 million in year one, rising to €7.9 million at the end of its third year. It also expects to move into the black in year four, by which point its accumulated losses will be just shy of €8 million.

Both say their forecasts are prudent and that shareholders will provide more funding if necessary. Both sides are also promising a mix of easy listening and classic hits. 4FM has even guaranteed never to play Boyzone or Westlife. The emphasis will be heavily on music, although both intend to exceed the 20 per cent requirement for news and current affairs.

TV3 is promising a 24-hour live news service. "We have the biggest newsroom in broadcasting outside RTÉ," McRedmond says. "We intend to leverage off that."

The Ballymount-based presenter line up will include Ireland AM's Mark Cagney and Aidan Cooney - old hands at the radio business. 4FM, by contrast, has yet to reveal its presenter line up.

But can Ireland sustain another commercial radio franchise? Denis O'Brien's €200 million acquisition of Emap's three stations gives him control of two national stations - Today FM and Newstalk. Twenty-nine commercial radio licences have already been issued by the BCI and with RTÉ feeding from the same advertising trough, not everyone is convinced that there will be enough to go around.

"The [radio advertising] market will grow next year, there's no doubt about that, but Ireland is past the point of saturation in radio," says Stuart Fogarty, managing director of leading advertising agency AFA O'Meara. "By increasing the number of licences, all you are doing is reducing the margins, which means that some owners are going to struggle. It's going to be tough for them to survive and I think we're going to see more consolidation."

Paul Moran, managing director at Mediaworks, a leading media buying agency, believes the station is viable on the basis that its over-45s audience has plenty of disposable income.

"There's an increasing focus on the so-called silver euro," he says. "Take the Government as an example - there's a lot of health-related advertising aimed at over-45s. It's a lucrative sector for advertising."

McRedmond is adamant that there is room for another player. "We're well beyond the days of people just listening to one station," he says. "People like choice and our plan is to offer an alternative to [ RTÉ] Radio One at all times of the day."

Block highlights the fact that in a decade's time, more than 40 per cent of the population will be 45 or older. "There's a large [ over-45s] market out there that has been largely undertapped to date."

The waiting for both sides is almost over. At 3pm on Monday, 4FM's chairwoman Mary Redmond will take the stage in the Conrad and make 4FM's pitch to the BCI board members. About an hour later, McRedmond will lead the way for TV3. A winner is expected to be announced in either January or February.

"It'll be tough but all you can do is put your best foot forward," Block says.