[icernet] The Radio comback

[Arul Selvan]

These days all good things are being said about the radio. That it is 
the second coming or the rebirth of the radio that the present 
generation is witnessing.That it is todays fastest-growing medium  
steamed off on a journey of regeneration and resurrection.That the other 
communication mediums, such as print and audio visual, cannot hope to 
replicate the unique medium of radio at any point of time in the future. 
Of course, not entirely without basis are such assertions being made.

Television needs time by appointment, while the radio can be heard 
anywhere. While jogging, driving or conversing. Besides, does not a 
music concert seem so much trivialized on television screens? Isnt it 
so much better to have soulful music wafting out of anonymous radio 
sets? Dont good things of life somehow lose value and get de-energized 
when stated as the obvious? One hardly needs too great imaginative 
skills to find answers to these.

Today lives are running along much fast tracks. In the coming years, 
time will be much more at a premium  and television might find its 
space shrinking. Also, technological innovations have made radio-enabled 
mobile phones possible. The radio can also be heard on televisions or on 
personal digital assistants (PDAs). Certain companies have started 
marketing wind and play transistor sets  requiring no battery or 
power connection. Besides, a radio or transistor set is also so much 
more inexpensive in comparison. These are among the arguments put 
forward in support of projections concerning the bright outlook for the 
radio.

Since the 1999 decision of the Central Government in liberalizing 
regulations for setting up private radio stations, a good deal of 
activity has been happening on the ground. More than a dozen private 
radio stations have started operations at big and small centres 
including the four metros with Delhi, Chennai and Kolkata having got 
wired up last month. Public Relation (PR) agencies have been taking a 
serious look at prospects of radio advertising, while manufacturers have 
been racking their brains for developing more innovative models of radio 
sets. Also, for equipment vendors from Australia or the United States, 
it has been Destination India  with these companies hawking an array of 
antennas, cable and studio equipment. On its own part, the Indian 
Government has been considering possibilities of floating the second 
round of bids ( for the setting up of private FM stations at 70 
additional cities throughout the country).

But these continue to remain somewhat troubled times for the Indian 
radio industry. The facts speak for themselves. In early 1999, 23 
companies had bid for 108 frequencies in 40 cities. Now, just 22 
stations remain in 12 cities. In Mumbai, five of the 10 players remain, 
and eight operators have dropped out of the Delhi circle with just three 
remaining. As of now, the radio business is not as viable as one might want.

 From the viewpoint of private broadcasters, the problem is with the 
license auction agreement as decided in the first round of bids. Bids 
went for fabulous amounts between Rs. 7.5 crore to Rs.10 crore in most 
centres. According to the agreement, the private players are required to 
pay correspondingly higher sums after the completion of each year of 
operations. The private players have been clamouring for the waiver of 
this clause as the revenue generation has been marginal. As they have 
pointed out in a memorandum to the Information and Broadcasting 
Minister, Shri Ravi Shankar Prasad, five private stations in Mumbai are 
required to pay an auction fee amount of approximately Rs.10 crore this 
year as against Rs.8.5 crore last year, although the total revenue 
generated by them has totalled only Rs. 2.2 crore. Upon the suggestion 
of the Minister, the private parties have presented to him a copy of 
their separate balance sheets. The Government is presently considering 
ways for providing the radio with a more congenial growth environment.

Radio ad-spend in India has remained pegged at a lowly 1.5 per cent as 
against 12 per cent in Australia, 12-15 per cent in US and between 7 to 
10 per cent in some South Asian countries. Operators believe that the 
share of radio ad-spend can increase only in the event of the 
participation of a greater number of players. Television provides the 
example, ad-spend generated by the television in 1992, Doordarshans 
sole monopoly days, totalled 15 per cent of the ad-pie. Ten years down 
the line in 2002 it was 38 per cent. The radio operators want a 
migration from the present license auction option to the revenue-sharing 
model. They feel this would enable the industry to generate an increase 
in ad-spend upto 3-5 per cent in the short run and about 7-8 per cent in 
the long term.

Community or campus radio is another enterprise that the Central 
Government is interested in promoting. Presently, the offer holds good 
for recognized institutions and colleges (IITs, universities and 
registered residential schools) and several institutes including 
IIT,Kanpur have shown interest. The Government does not levy charges for 
the setting up of such Low Power Transmitter (LPT) station, although the 
customary charge of spectrum fee has to be deposited. Several institutes 
have been pursuing plans of setting up campus radio stations. The 
Governments plans are to enable about 100 institutes wired up to campus 
radio within the next one year.

Two autonomous bodies-the Broadcast Engineers Corporation of India 
Limited  BECIL and the AIR Resources  a wing of the Prasar Bharati 
have been offering turnkey

solutions for setting up campus radio stations. It would cost between 
Rs. 10-12 lakh to set up a campus radio station.

Besides, foreign equipment manufacturers have been eyeing the Indian 
market. Given the fact that there are more than 400 recognised 
institutes and colleges in India, the market size is estimated as being 
huge. Initial estimates are that the size of the services market would 
not be less than Rs. 60 crore.

Source:
PIB Features
http://pib.nic.in/feature/feyr2003/fmay2003/f200520031.html