The 16 companies, which paid up bank guarantees amounting to Rs 158.75 crore, are losing interest on the same. As these companies have yet to get the requisite clearances for frequency allocation and setting up transmission towers despite paying the bank guarantee in October, they're losing time and therefore a lot of money in the form of interest.
Since the bank guarantee furnished to the government at the time of signing the FM agreements serves as the annual license fee for the first year, the interest on that is rather substantial. Among others, the Mid-day group (North, West, and South) paid a total of around Rs 20 crore; Ispat group's Music Broadcast paid Rs 41.375 crore; Living Media's Radio Today paid Rs 17.8 crore and Bennett Coleman's Entertainment Network paid Rs 43 crore, as the first year's license fee.
Even though these payments were made in October and the FM players applied to the Wireless Planning and Coordination Committee (WPC) in the Communications Ministry immediately after that, no clearances have been given yet.
The lack of decision-maker in the government has put the FM guys in the dock, says a player. The only thing that they have now to fall back on is their consortium, which is meeting regularly to chalk out the future course of action.