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Merchant banker to be roped in soon for FM radio-phase 2

19-November-2004
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Merchant banker to be roped in soon for FM radio-phase 2

The government is looking at an alternative to the revenue-sharing model for the second phase of private FM radio, information and broadcasting minister S Jaipal Reddy told FE on the sidelines of the economic editors’ conference here on Thursday.

Earlier at the conference, Mr Reddy said that a merchant banker would be appointed soon to roll out FM-phase 2. He added that the policy framework for private FM will be finalised within two weeks, after which the Cabinet will take a decision on the matter.

On the issue of allowing funds from foreign institutional investors (FIIs) in TV news channels, the I&B minister said: “The government hasn’t taken a view on it yet.” But, sources indicated that the government is likely to allow FII funds into news channels.

As for FDI in print media, he said: “We have no intention of rolling back FDI in print though we had opposed it earlier.” He added: “We don’t want to destabilise the investment regime. The present regime will continue, as of now. I’ve learnt to live with the regime that I’ve inherited.” The issues related to print media are being examined by a group of ministers (GoM) headed by home minister Shivraj Patil. GoM is likely to form a view on the subject within a month, according to the minister.

On private FM radio, when asked whether the government was planning to introduce a revenue-sharing model, instead of the current licence fee regime, the minister said: “The regulator has proposed revenue-sharing. We are looking at an alternate mechanism also.” He refused to elaborate on the other option.

The Telecom Regulatory Authority of India (Trai) had recommended a shift from the licence fee regime to a revenue-sharing era a couple of months ago. The focus will be on expansion, rather than on revenues now, according to Mr Reddy. “There’s scope for 400 more FM radio stations,” he said.

Among other issues, Mr Reddy said, downlinking guidelines would be finalised soon. On setting up a content regulator, he said “we have yet to take a view”. It could either be two separate regulators for content and carriage, or a super-regulator. As for the pending direct-to-home (DTH) application of Space TV (Star-Tata joint venture), the minister said it’s being processed. “We want to encourage DTH,” according to Mr Reddy.

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