Broadcaster GCap Media has become the latest radio operator to close stations after calling digital radio 'economically unviable'.

Planet Rock and theJazz stations will be shut down as GCap shifts focus to its core FM stations to revive its fortunes. GCap has also agreed to sell its stake in Digital One, the national broadcasting platform for digital stations, to communications infrastructure firm Arqiva.

UBC Media last month closed its Oneword station, saying it had been losing around £1 million a year on the service. It said that public take-up for digital radio has been far less than originally forecast.

Gcap's decision to scrap Planet Rock and theJazz comes only weeks after closing down Core, another digital station.

Chief executive Fru Hazlitt is in the middle of a strategic review as fights off takeover interest from Global Radio.

It plans to boost advertising at its flagship Capital station, reversing its previous policy of broadcasting no more than two adverts in a row.

Hazlitt hopes to deliver cost savings of £8.8 million a year through disposals and restructuring, as well as achieving profit margins of up to 19% by March 2010 under the 'radical but realistic' plans.

The company - which has around 15 million FM listeners - said that, in the year to March 2007, it spent £8 million on digital radio despite the medium accounting for just 9% of all radio listening.

Hazlitt said: 'FM is the backbone of the radio industry and we believe it compares favourably to any of the digital platforms currently available to the consumer in terms of quality. It is also the source of the majority of our revenue.'

The company plans to concentrate on its Xfm brand in London and will close down its three loss-making regional Xfm stations in Scotland, Wales and Manchester.