Unlike in the first round of FM radio privatisation, merchant bankers are expected to be roped in for rolling out phase two. The process to select merchant bankers will begin soon, government sources said.
The first round of privatisation failed to take off in a big way, after many bidders moved court, and some others decided to leave the fray. Also, in the first phase, FM players have been complaining about the steep licence fee. The NDA government had set up an expert panel to work out recommendations for second phase of FM radio. This panel wanted a shift from the current licence fee regime to revenue-sharing era. But, the present government is not in favour of a revenue-sharing arrangement.
“We want the second phase of private FM radio to be error-free,” an official in the I&B ministry said.
Although the I&B ministry is not in favour of allowing a revenue-sharing arrangement between private FM radio players and the government in the second phase, the Union Cabinet has to approve the guidelines for phase two. “An alternate formulation can be worked out,” sources indicated.
Recently FE had reported that an expert team is at work to assess frequencies which can be repeated for the second phase of private FM radio.
It is important to make this assessment because only four mhz of frequency is available for private radio players in the country, according to sources close to the development. On the whole, All India Radio and private FM players have a total of around 21 mhz of frequency (87 to 108 mhz).
The objective behind this kind of spectrum planning is to increase the number of transmitters on the same frequency without any interference, he said.
Last month, Telecom Regulatory Authority of India (Trai) had issued recommendations on the second phase of private FM radio.