The private FM sector is hopeful that with the completion of the second batch auctions of Phase III in 2016, radio’s credentials as a relevant and far-reaching medium will be firmly set. We spoke with Harrish Bhatia, CEO of MY FM, to get his thoughts on the future of the private FM sector. Excerpts:
How has 2015 been for the radio sector? Apart from the auctions, what were the key trends of 2015 according to you?
The radio industry in the first half has seen positive trend, we have grown by around 12 per cent if we compare Q1 with Q2 of FY 2015-16
Auctions were a positive sign but apart from this we see some new categories like dotcom sampling radio specially in metro markets and some bit in our markets Tier II and III, we are hopeful that the share of revenue from dotcom will go up in the near future. Existing categories like automobile, lifestyle, real estate have shown some positive trend in terms of spends on radio going up. In fact, radio is now integral part of each marketing plan, which is a boost.
The first stage of the Phase III auctions has been the watershed moment for the sector. From a holistic view, how important has it been for the Indian FM industry and where does it go from here?
There’s only going to be an upswing from here on. Batch I of Phase III is was a landmark event for the radio industry and I am hopeful it has set the ball rolling and we will witness completion of Phase III in 2016. Once the entire phase III auction is complete, radio will become a pan India medium, which will be a big boost for the industry. We have witnessed that radio is now part of all media plans and client have realized the potential of the medium.
Though the Phase III auctions have been carried out, there are still certain issues that radio operators want resolved, for example, migration fee rationalization, bandwidth spacing, tower infrastructure, etc.? Is the private FM space heading in the right direction and what are the expectations in 2016?
Migration fee rationalization issue is already in court and the matter is subjudice. From Batch II onwards, the mandate of setting up infrastructure via BECIL will no longer be in effect and that should speed up the process of setting up new Radio stations.
Apart from the above, the govt. should address the music royalty issue which is not yet resolved and we are still waiting for a copyright board to be constituted for the last 4 years.
With FDI having been increased in the radio sector, is the growth in the FM sector set to pick up pace?
Radio will pick pace as soon as Phase III get completed, all the players in radio business are serious players and cash rich but, yes, with radio set to expand nationally it will definitely see some attention from international companies.
What trends do you foresee in 2016?
Internet companies will become the biggest spenders in our industry from an advertising perspective. We have seen that radio has become a very relevant sector in 2015 for both brands and listeners and we expect to see this continue in 2016.