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The development aids the cause of GCap and Digital One, the digital radio multiplex 50% owned by GCap, which felt threatened by Ofcom's decision to licence a competing national multiplex within the next year.

It also strengthens commercial radio's hand in the battle with the BBC. GCap sees a jazz format as the best way to steal listeners from BBC Radio 2, Radio 3 and Radio 4.

The station will launch towards the end of the year, will be aimed at 35-plus ABC1 listeners and will be cross-promoted by Classic FM. It will play a "broad range of styles from across the jazz spectrum", according to GCap.

GCap's group commercial director Duncan George said: "This is something we're extremely excited about. Jazz is a tremendously popular genre and is clearly underserved. Not only does a national jazz station have huge potential, both creatively and financially, it is a great addition to our portfolio; a collection which already covers all forms of classical, pop, rock, indie, alternative, R 'n' B, hip hop, dance and chillout music."

Classic FM's station manager Darren Henley will take responsibility for programming on the new station. Henley would not disclose the programming budget nor amount of live programming there will be at launch.

Digital One required approval from Ofcom to change its licence requirements in order to put the new station in the slot formerly occupied by PrimeTime Radio, which was aimed at the 50-plus grey market.

Ofcom has changed the licence requirement to provide an easy-listening service to a classic and contemporary jazz service "playing a selection of jazz, soul, blues and R'n'B".

PrimeTime ceased broadcasting in May following an acrimonious dispute between PrimeTime owner Roger de Haan, the former owner of Saga Group, and Digital One.

De Haan claimed to have been unable to come to an agreement with Digital One about extending PrimeTime's licence. The licence commenced in 1999 for 12 years, with a break clause after six years.

GCap now accounts for five of the eight commercial stations on Digital One, with the new station joining Classic FM, Planet Rock, Core and Life.

The other three stations are SMG-owned Virgin Radio, UTV-owned TalkSport and the Channel 4/UBC-owned Oneword.

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