History of Indian Radio & Players in Different Centers

For more than 4 decades, the Government of India did not permit private radio stations to broadcast in India. Then history changed its course. In 1993, the Government allowed private FM operators to ‘buy’ blocks (chunks) on All India Radio, prepare programming content, book commercials from advertisers and broadcast the whole lot. Within 4 years, (1997-98), the FM Radio advertising and sponsorship business grew to Rs. 93 crores with Times of India’s Times FM & Mid-Day Group’s Radio Mid-Day becoming the main players.

Then, in June 1998 the Government, through its electronic media regulatory body Prasar Bharti, decided not to renew contracts of private FM operators.Not surprisingly, the advertising revenue fell by 50% within a year!

This time, the Government gave the green light to privatize radio in India. July 6, 1999 was the historic day when the Government announced that 150 new FM channels would be licensed across 40 cities.

And in 2000, the Government auctioned licenses for private FM channels to bolster the revenue. And the focus on metros was evident in the bidding. Expecting to collect Rs 800 million from auctioning 108 licenses, the government had to actually face mass withdrawal of bidders because of the huge license fee. A handful of serious bidders chose to remain.

In response to the Government’s offer, many companies bid for the licenses to operate in key markets. But the going was not so easy. Many gave up, unable to shell out the high license fee. For instance, the bidding price for the Mumbai license was reportedly to the tune of Rs 9.75 crore. Others dropped out saying the business was not viable. So, in effect, the competition shrank, players consolidated and the Government extended its deadline. Today, there are roughly 10 players who will operate approximately in 37 cities across the country.

The government collected close to Rs 4.6 billion as license fee for the privately run FM radio channels in 40 cities. New Media Broadcasting, a Zee Group company, which focused mainly on the smaller towns, won the largest number of bids.

The first round of bidding – for 76 channels in 26 cities, garnered close to Rs 3.5 billion. The government got the highest bids – Rs 97.5 million from each of 10 broadcast companies – for stations in Mumbai. Interestingly, the bids for Hyderabad and Nagpur came next, each for Rs 77.2 million and Rs 74 million, respectively, while the bids for Delhi were Rs 71.2 million each

Radio is expected to follow the growth of the Television industry, which grew rapidly following the entry of private players

Currently, FM coverage in India is restricted to just 17% of the country, compared to 89% of All India Radio (AIR).

Players in Different Centers

Incidentally, Music Broadcasting became the first firm in India to commence private FM broadcast from Bangalore in July.

Source: http://www.mediatrendsdigest.com/archives.html?recno=620

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