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Ab ki baar, FM radio ko bachao Sarkar! A plea for action

05-June-2014
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Ab ki baar, FM radio ko bachao Sarkar! A plea for action

To The Prime Minister Shri Narendra Modi & The Minister of Information and Broadcasting Shri Prakash Javadekar,

Respected Modiji & Prakashji,

The private FM radio industry has struggled and survived despite government apathy in the past.
It is on the verge of precious licenses expiring within nine months that need to be extended.

Phase III of FM radio has been stuck in the pipeline for three years. This delay is a Rs 1700 crore worth of loss to the exchequer. The industry still struggles with a negative return on capital as 10 years were not enough at the high priced OTEF paid in Phase II. But all the players have remained invested and have worked very hard to survive. Investors in this business are now very worried as they cannot commit investment into uncertainty caused due to lack of clarity on extension of current licences.

Unshackling private FM radio is a win-win for the government, the players, listeners, advertisers and of course the exchequer!

FM radio Phase III policy was cleared fully almost two years ago. This policy will take private FM radio to the widths and depths of our country. The only concern in it was a migration/extension fee for existing players since the current Phase II licences are of 10 years and Phase III licenses are for 15 years. This migration/ extension fee formula was arrived at by TRAI and has been accepted by radio players after much deliberation and consultation with all concerned. It is the only formula that looks at extension of licenses with a true price discovery and though reserve price is still on the higher side, given that time is money, the players have accepted it.

ONLY IF CURRENT PLAYERS’ LICENSES ARE EXTENDED CAN THEY LOOK AT THE INDUSTRY CONFIDENTLY AND BID OPTIMISTICALLY IN PHASE III TO MAKE IT A SUCCESS. All this needs is a ‘signoff’ from the Ministry of Information & Broadcasting!

Our request is that this be taken on top priority NOW as time has run out. The Ministry of Information & Broadcasting must apply itself in a conclusive manner on this. We need launch of Phase III and permission for existing players to sign GOP A so that existing players licenses can  be extended using the TRAI formula. It should be point 1 in the 100 day plan of the Ministry of Information & Broadcasting given that over Rs 1700 crore can be generated with renewals alone  not to mention more with auctions and bidding for new licenses.!

We request that extension of licenses and Phase III GOPA signing be the only priority at this stage. Though ‘popular’ announcements like allowing NEWS are welcome, they require Phase III policy to go back to parliament which cause critical delays. WHAT WILL PLAYERS DO WITH ‘NEWS’ IF THERE IS NO EXTENSION OF LICENSES AND INVESTORS GIVE UP DUE TO UNCERTAINTY.(Amendments to the news issue can always be made in parallel along with 49% FDI, etc.)!
We, FM radio as an industry are critical to the Indian media landscape, the only free medium in the country that offers excellent economical reach everywhere in the socioeconomic strata.

We are the only entertainment medium that pays advance license fee to the government and yet is penalized with delays.

Every little development we seek is an arduous and complicated task. It is time that we are given just a little attention and respect from the  GOVERNMENT OF INDIA. The people in the FM RADIO industry have worked very hard over the last 12 years to build businesses of substance and create robust employment and value across the country.!

We hope sincerely under your NEW leadership we will get what is! due to us sir/s. We look forward to quick and favourable announcements on the priority issues mentioned above. June 30th is the current deadline on the Ministry website. We hope this will be adhered to, so as to showcase seriousness by the new ministry to all stakeholders.

Vineet Singh Hukmani,
MD & CEO Next Radio Ltd (94.3Radio One)
 

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