Last week, the Telecom Regulatory Authority of India (TRAI) had sent out its list of recommendations to the Government pertaining to the Phase III migration of private FM operators. (TRAI releases Phase III recommendations, agrees with broadcasters on most points).
In general, the industry seems to have welcomed the recommendations and appreciated the fact that TRAI has understood most of the concerns raised by private FM radio operators regarding the migration process.
One of the recommendations put forth by TRAI is the need for a review of the reserve price for the auction of 839 new FM frequencies, saying the current system might jeopardise the auction. TRAI has given a few options, which it felt would make the process less burdensome for the operators.
Welcoming this move, Nisha Narayanan, COO, Red FM said, “The migration issue has been a contentious one and was a cause of concern for some operators. We are happy that the TRAI has recommended a 15-year license period and considered the migration fees based on the availability of channels in a particular city. This will help in rationalising bidding in case of a scarcity situation and we warmly welcome the same. We are pleased that the cut of date for migration has been put as March 31 2015, which means that the auctions have to happen before that date so that the migration formula can be applied.”
Speaking to exchange4media, Prashant Pandey, CEO, Radio Mirchi also supported the 15-year license period and commented that overall TRAI has done a “fine job”. Explaining the importance of TRAI’s recommendations, especially when it came to the bidding process, he said, “TRAI has ensured in their formula for calculating migration fees that irrational bidding in Phase III doesn’t directly impact migration fees of current licenses. TRAI's recommendation to re-look Phase III reserve fees is particularly praiseworthy as the FM industry has been most worried about this point. In 2G auctions also we’ve seen that when reserve fees was pegged too high, auctions failed (Nov 2012 and March 2013), but when it was lowered and made more reasonable, it succeeded (most recently).”
He further said that TRAI had understood the biggest concern of radio operators – that auctions shouldn’t happen under scarcity conditions. “This is why they have re-recommended the 400 KHz separation, which is prevalent in most countries worldwide,” he explained.
It now remains for the Ministry of Information and Broadcasting (MIB) to weigh in TRAI’s recommendations and take the process forward; something the radio operators want to be done as soon as possible. Apurva Purohit, CEO, Radio City, in a statement, said that she welcomes the recommendations by TRAI and is pleased with the license extension to 15 years. She also said that she hoped that MIB will now expedite the process for the auctions.
When asked about what the way forward was now for the radio industry, Pandey added, “TRAI is intellectually very strong. I have no doubts that the Government gives a lot of importance to TRAI recommendations.” He also expressed the hope that the Government will immediately accept the recommendations.