The price of a digital radio is to tumble from £300 to £100 within the next 12 months.

This will mean digital radio is now for the first time accessible to most consumers.

National multiplex operator Digital One, controlled by GWR and cable group NTL, today put the finishing touches on a £3m joint venture with Imagination Technologies to produce a cheaper second-generation chip that will slash the price of boxes.

The plan is to cut the price to £99 for a basic radio within the next 12 months and speed up consumer acceptance of the new technology.

At present, only 0.1% of the population has digital radio, despite the fact there are 178 different services running off 35 digital radio services in London and 20 digital multiplexes across the rest of the UK.

"Progress continues on the expansion of transmission areas, with 78% of the population already able to receive digital quality radio," said Ralph Bernard, chief executive of GWR Group,

"The availability of a lower cost and a broader range of digital radios earlier than anticipated should speed the development of the consumer market in digital radio."

Last month all UK digital broadcasters joined together in a pooled Digital Radio Development Board to promote the benefits of digital radio to consumers.

Knocking down the price will go a long way to securing the future of the fledgling industry.