The tipping point of radio has arrived: Experts

With Phase III FM expansion around the corner, the industry is looking forward to further growth of the radio medium and have called it the second fastest growing medium in the country…

e4m by Anisha Singhi
Published: Mar 25, 2011 8:41 AM  | 4 min read
The tipping point of radio has arrived: Experts

An exciting new phase and tremendous opportunity in radio is expected to open up once the phase III rolls out. With this, 800 new stations in nearly 300 towns will be auctioned. It is expected that radio will grow so much in reach that it will be able to compete with the print medium. And radio unlike print, is an interactive medium.

Prashant Panday, Chairman, FICCI Radio Forum & CEO, Radio Mirchi, said that radio was the second fastest growing medium in the country. The industry currently operates with 215 stations in 80 towns.

Elaborating on the opportunities, Panday said, “Phase III will enable multiple frequencies, therefore, enabling plurality of content. The licenses will be valid for 15 years as opposed to 10 years. This will lead to more investments from the advertisers.”

LV Krishnan, CEO, TAM India Ltd, elaborated on the growing listenership of the radio owing to the mobile phone. He pointed out, “Today 80-90 per cent of the people are accessing radio on the mobile. The mobility of the medium has shot the accessibility and the time spent. There are 40 million listeners in just the top metros and a total of 250 million in India.”

Tarun Katial, CEO, Reliance Broadcast Network Ltd, was also very hopeful about the future of radio. He said, “The tipping point of radio has arrived. Many stations in India either stabilised or grew in the slowdown period.”
Continuing on the opportunities on the future of the radio industry, Harrish Bhatia, CEO, My FM, said that radio was going to be more retail than corporate and that was going to drive the business.

Radio has seen a very controlled expansion in terms of the number of channels. It is not shooting up like the television space. This works in the favour of the medium. The real estate and the educational organisations are two sectors that have moved from print to spending very extensively on the radio.

After the Phase III rolls out, according to Bhatia, radio is going to be more expensive that television if bought nationally. But the benefit here remains that a specified geography can be targeted at a cheaper cost.

One of the other things that the phase III will also allow is the airing of news on the radio channels. However, the content will be provided by Prasar Bharati. Rahul Gupta, Director, Radio Mantra viewed it as just another addition to the component. Gupta elaborated, “It will not be a game-changer because the access to the news and current affairs will be limited.”

However, Bhatia thought that the channel will become more powerful. Bhatia explained, “The Government is going slow because they are not sure if all the channels will deliver news responsibly. But it will be a game-changer.”

Commenting on the opportunity that the airing of news on the radio channels will provide, Krishnan said, “The age group of 45+ are usually the in-home news listeners. Whereas, the age group of 20-34 are the out-of-home news listeners/readers. Radio news can go outside home, hence, opening up an opportunity of catering to a new set of audience. Packaging the content is very important.”

When asked about the worries from Phase III, Salil Pitale, Executive Director – Investment Banking, Enam Securities said, “There will be multiple frequencies allowed. But not many frequencies will be allowed in the metros and major areas. Thus, there will be limitations in programming.”

Katial said that 2010 was spent in waiting for the phase III to roll out. “I don’t want 2011 to be spent in waiting again. The government should sense the urgency to implement the policy”, Katial urged.

On the other hand Krishnan thinks that a lot of time is being spent on worrying rather than working at finding solutions. He concluded rather positively, “Every medium has problems. Radio is going in the right direction. And it is just a matter of time before it gets its due recognition.”

The speakers were taking part in the discussions during the session on ‘Coming Soon - 800 new Radio Stations in 300 Towns: Opportunities and Hurdles’ at the FICCI Frames 2011, which got underway in Mumbai on March 24, 2011.

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