A strong wind sweeps through Portland Place in central London. Office workers hide behind popped collars, smoke that final cigarette of their lunch-break and make idle chit-chat with their colleagues. Meanwhile, in a surprisingly ordinary conference room on the eighth floor of Broadcasting House, behind various locked doors and black-suited security guards, 12 people are meeting to decide the future of British music. This is the Radio 1 playlist committee, a meeting so covert that it took several hundred emails for me to be allowed to sit in on it. Why did I persist? As a twentysomething new music lover and on-and-off Radio 1 listener since my teens, I fit bang into the station's target demographic, yet I've begun to find its daytime roster of hits increasingly bland and passé. I'm here to find out how and why artists make the cut.

At the head of the meeting table sits George Ergatoudis. He's funny, he's smart, and – as Radio 1's head of music – he's the most powerful man in the music industry. Ergatoudis decides whether your band gets daytime airplay on the biggest radio station in the country (Radio 1 reaches 12 million listeners a week, including 42% of all 15- to 24-year-olds, and its Facebook community numbers 15 million). Ergatoudis, therefore, decides whether you're going to make it commercially or be exiled to the darkest corners of the musical underground. On his right sits Nigel Harding, Radio 1's music policy executive (three years ago, he was ranked the fourth most influential player in the industry by the Guardian, below Adele's music team, Universal label executives and Simon Cowell).

Nigel Harding. Photograph: PR

The meeting is not what you'd expect, if what you're expecting is the Bilderberg Group. Around the table sits a group of people in their 20s or 30s, in denim shirts and fluffy pink jumpers. They browse Twitter on their iPhones, share snacks, make jokes, and flip through back issues of Closer. Almost all of them wear Nike Trainers. "Calvin Harris we need to keep going with," says Ergatoudis, kicking things off. "We've done everything we need with [EDM group] Cash Cash. Lily Allen's Our Time… we can come off that too, it hasn't done as well as anyone hoped, including, I'm sure, Lily and the label. The album is being sold for 99p online", to which a couple of people "Aww!"

The playlist committee's job is to choose around 40 records each week for repeated daytime play (A-list records get 25 plays a week, B-list 15, and C-list eight to 10). After deciding whether to keep current playlisted tracks, the discussion moves on to new additions. A snatch of each song blares through speakers before Ergatoudis lists the artist's YouTube views, Soundcloud hits, Shazam ratings, Twitter followers and Facebook likes. "[Indie foursome] Wolf Alice's Moaning Lisa Smile video has had 15,000 views on YouTube and they've got 11,000 followers on Twitter," Ergatoudis tells the room. "James, you want to go first?"

"We really love them on the show," James, who is Fearne Cotton's producer, says. "It's something we can play, which is a first for them."

The BBC building at Portland Place. Photograph: Graeme Robertson for the Guardian

Natasha, producer of the Phil and Alice evening show, chips in: "I'm up for an In New Music We Trust addition [a fourth list for songs that are coming out of the station's specialists shows], but I don't think it's particularly groundbreaking."

They move on to Victory Line by Cambridge rock band Lonely the Brave. "So far no official video on YouTube," says Ergatoudis. "Twitter followers 12,000 [quite low]."

Natasha points out that Lonely the Brave have been nominated for a Kerrang award, "so they have people backing them".

"It sounds like Feeder to me," offers Matt, Nick Grimshaw's producer. "It's a bit dirgy. I'd take Wolf Alice over it, there's a bigger audience demand for them online."

After they've gone through the full list, Ergatoudis goes round everyone on the table for further suggestions. Someone mentions Peace, whose "video is doing all right with 300,000 views. They also have 45,000 followers on Twitter, which is good at this point."

Zane Lowe. Photograph: Susannah Ireland/Rex

"But Zane [Lowe, Radio 1's new music guru] hasn't played it in two weeks," Harding points out.

"It's not the world's best EP but I'm worried if we don't play it we'll be pulling the carpet from under the band," says another seasoned producer, Phil.

"They wouldn't have been booked for the main stage at Reading if they didn't bring kids. They're like Palma Violets, where it's about their live shows," says Natasha.

Getting on to the playlist committee, which is reviewed every six months by Ergatoudis, is a competitive process "I try to put together people from a very broad range of subjective tastes," he tells me afterwards when I sit down with him and Harding. "They all have a broad knowledge but also particular expertise of a different genre of music."

George Ergatoudis (left), Radio 1’s head of music, and Nigel Harding, the station’s music policy executive. Photograph: Katherine Rose for the Observer

"It's a real privilege to be in this room and also it's a great responsibility," Harding says. "People can't just turn up and proffer an opinion having just heard something for the first time." Indeed, committee responsibilities extend beyond this room: there are constant meetings with label reps and promotions teams (the pluggers) every week to hear the hard sell on upcoming artists. "Everyone has to foster those relationships; go to gigs and really be immersed in new music and the specialist output," says Harding. "We probably see anything up to 30 separate plugging teams a week."

So how do you give small labels a chance, then, I ask. "We have a very strictly controlled set of rotations in terms of how much access labels have to anyone on the music or playlist team," Ergatoudis says. "This includes lots of bookable slots so that independents can just call us up and go 'we'd like to see you'. Of course, we have to tailor it to meet how much material there is. If you're Virgin or EMI, you have a lot of repertoire, so we'll give you more access than an independent with one project on the go." Nevertheless, as becomes clear in the meeting, the internet has diminished the power of pluggers in favour of stats about an artist's online popularity. "There's more music out there than there's ever been because it's cheaper to produce and distribute," says Ergatoudis. "And with the abundance of technology-based businesses, there are now more ways of finding out what is going on out there than ever before. There's nowhere to hide."

These digital platforms have shifted responsibility to the artist. Harding has mentioned in the past that it's not a fault of record companies to have a certain level of expectation of an artist before signing them because all the means [to get established] are there, for free. Does Radio 1 expect artists to be able to achieve a certain level of success on their own? "Radio doesn't exist in a vacuum," Harding says. "Our audience discovers as much new music on YouTube as they do on the radio, so [online presence] is a decent marker of a band's status. If there's very marginal interest in a record online, or none, then it's a little red flag for us. It's become easier to pick the right stuff."

Does this mean they're taking fewer risks? "I think the risk factor is still real because it's very tough for an artist to properly cut through," says Ergatoudis. "Increasingly you hear songs that might connect but actually getting an artist to connect as a brand is still amazingly tough. Radio can break a song, but the artist has to do their part. For example, when we started putting Mumford and Sons' first two singles on our A-list, the audience really hadn't figured it, they thought, 'What is this strange music with banjos?' But the band was out there playing live, introducing people to their sound and their brand. And then by the third single the audience suddenly got it. Some bands have it, some don't, and to be able to tell that from a really early stage is very difficult. You have to trust your gut. That's the risk."

Mumford & Sons photographed at Fulham Palace. Photograph: Chloe Mallett for the Observer

It's faintly depressing to hear bands referred to as "brands" with their worth determined by online data. Stats is business talk. It isn't creative, it isn't art, it's box-ticking. It's playing people the kind of music that they're already listening to. Harding says, though, that there are exceptions to this rule. "There have been moments where we've been tempted to completely go against data. Clean Bandit have had the biggest single of the year so far and we booked them for a live lounge in January last year, purely on the basis that we had a feeling they were doing something special. They didn't have very much in terms of stats. And it took a year of us playing a sequence of singles for people to jump on to them - a lot of people think Rather Be was their first single but actually it was their fourth that we playlisted on Radio 1."

At the playlist meeting, an example of this arises in the form of Royal Blood. Despite not having a sizeable social media following, the band's successful inclusion on "BBC Introducing" (the station's new artist slot) is discussed, as is the fact that they're touring with Arctic Monkeys in the summer. "At the moment in stats terms, it's incredibly early doors for the band," Ergatoudis says. "Yet the level of passion for them around the building is massive. We believe that between their power, their energy, their brand value and the songs they've got, they're exciting and different and they'll cut through." And it's not a lone incident, he says. Throughout the year, if you look at any British success stories – London Grammar, Rudimental, Disclosure, Bastille – Radio 1 has played the most significant role in breaking them.

When I ask about artists the station has been late to, such as Drake, "it's because their songs are not suitable for daytime radio play". And what about the artists they haven't broken? What about the songs they don't play? In the late 2000s the BBC Trust criticised the station for having too old an audience and said it must focus on getting the average age down to under 30. The Trust promised to monitor Radio 1's listening figures among the 15- to 29-year-old demographic over the coming years. But despite introducing younger presenters, the average age of a Radio 1 listener is still 32.

When I mention this, Ergatoudis shuffles in his seat. "Average is a ridiculously blunt measure," he says. "Today's 30- to 50-year-olds have lived through just about every genre of music that's ever existed, from the most hardcore metal to hip-hop to dance and house."

He tells me that if you look at the list of the 1,000 favourite artists for 60-year-olds and the 1,000 favourite artists for 13-year-old, there is a 40% overlap, and if you take 30- to 39-year-olds and 13- to 19-year-olds, over 50% of their favourite artists are the same. "So their worldviews are nowhere near as separate as people think they are." The only thing Radio 1 can focus on, then, is its output. "Every decision we make is based on the questions 'Is this relevant for a young audience?', 'Will this track be appreciated by 15- to 29-year-olds?'"

Age has always been Radio 1's achilles heel, and the policy that Ergatoudis is talking about has been cause for much criticism by artists who have been left off the Radio 1 roster. In 1996 Status Quo took the station to court for having a "blanket ban" on their songs, and in the same year Paul McCartney was riled enough to write an article for the Daily Mirror stating that "you can't put an age limit on good music" after the Beatles' posthumous Real Love was overlooked by the station. More recently, Robbie Williams made headlines after he called Nick Grimshaw a bastard because his single Candy wasn't playlisted, Dizzee Rascal slammed the station on Twitter for being "two-faced" and Noel Gallagher ranted in an interview: "I don't understand it. It's when radio stations start focus groups. They literally go outside their building and ask people walking by, 'If I played you this song, what would you think?' and all that. Don't ask the man on the street! He's a cunt!" That's why he's the man on the street, not the man in the expensive restaurant eating fucking mini sausages at four in the afternoon!"

Harding gives an exasperated laugh. "We were convinced that Noel Gallagher and Robbie Williams's core fanbase is over the age of 30. Every artist will at some point make that transition where a 16-year-old doesn't care about them any more. And it's a painful experience. Not only is the artist upset, sometimes there are journalists who love that artist and don't want to be seen as old fogeys. They're worried that once Radio 1 lets them go it's a milestone [passed] in their life.

"But what's frustrating is that they got it back to front: they thought we hadn't added them because of their age, but we play lots of Eminem, lots of Jay Z, lots of David Guetta and Dave Grohl. It's not about the age of the artist, it's about the age of their predominant fan base. Pete Tong's average [listeners'] age is lower than the average age of the whole station, and he's been on Radio 1 for over 20 years. He's relevant to young people as a music authority."

Wolf Alice: notching up views on YouTube. Photograph: Katherine Rose for the Observer

And how are they so sure about what's relevant for 15- to 29-year-olds? "We do our research," Ergatoudis says. "We've got a panel of thousands of young people from the age of 12 to 29 in our overall research group, and we pay a research company to test 400 of them every week. We play them the hooks of 25 current songs, most of which we've played over 100 times, and they tell us which they relate to.

"On top of that we have library research every month, where we test 50 songs from the last five years to find out where they are on that repertoire as well. And then of course we all go to gigs, and you can see the age of audiences at those gigs, that's the true test."

Only last month, Jeremy Paxman hit out at his employers and said he sees no reason why Radio 1 and 1Xtra should even exist because they could be replaced with private sector broadcasters. Which is why, in the course of our interview, Ergatoudis and Harding bring up commercial radio's failings several times. "Only 9% of our playlist is on Capital FM but 50% of their playlist is on Radio 1, because they're basically playing Top 40 hits predominantly," Harding says. "That's why it's frustrating when people say commercial radio can do what Radio 1 does, there's little appreciation of the vast amount of music that we play that commercial radio would never ever touch. And many of the pop acts that are on the commercial radios now are only there because we started the story maybe a year or more ago in building them up in the first place."

There's another underlying question here: do young people still care about radio? "I'm not saying there isn't a battle on our hands," says Ergatoudis. "There absolutely is a challenge to keep radio relevant, and that's why we are way beyond just [being] a radio station." In order to attract the smartphone generation, Radio 1 is pushing hard into digital media – its YouTube channel now has more than a million subscribers and its recently launched iPlayer channel allows fans to watch exclusive performances and interviews. The successful Radio 1 Big Weekend – an annual festival hosted by the station in different UK cities – brings live music to an audience well beyond those who attend, with all the shows streamed live and then available on demand.

Calvin Harris performs at Radio 1's Big Weekend at Lydiard Country Park in 2009. Photograph: Simone Joyner/Getty Images

"There is this fear now every time new technology arrives," says Ergatoudis. "Everyone always says radio's going to die, or TV or cinema. But people like radio's liveness, its shared culture. If you are a medium that offers something unique and powerful, then you'll survive."

When I ask Ergatoudis and Harding whether promoting new music is still at the heart of Radio 1's remit, they reply with an "absolutely" that echoes around the room.

And I believe them. It's just that, with all the reliance on data and algorhithms and "brands" (and this is a pattern repeated across the industry as a whole), it all feels so soulless. In 1979, Radio 1 DJ John Peel said: "I'm paid money by the BBC not to go off and work for a commercial radio station... I wouldn't want to go to one anyway, because they wouldn't let me do what the BBC lets me do." What he was referring to was the freedom to offer a genuine alternative; to take listeners out of their comfort zones. It seems unlikely Radio 1 would take the same level of risk today, and that's a shame, because if my band were to miss out on our big break, I think I'd prefer to be told it was personal, rather than a matter of stats.

The most-played artists on Radio 1 over the past 12 months:

1. Arctic Monkeys

2. Avicii

3. Bastille

4. Disclosure

5. Chase & Status

6. Katy Perry

7. The 1975

8. Ellie Goulding

9. London Grammar

10. John Newman

BBC Radio 1's Big Weekend Glasgow concludes today on Radio 1, online, on mobile, via the BBC iPlayer Radio app and with highlights on BBC Three