Radio Industry In India Revamp Itself To Cope Up With The Changing Demand Of Audiences

Is Radio a conservative gizmo? The current generation deems radio a fuddy-duddy down market and not so cool electronic gadget while for them television and new media are the future media. But they never comprehend that radio is the oldest media and today almost all the electromagnetic gadgets run with the help of radio waves.

People use several household electromagnetic gadgets ranging from radio, television broadcasts, microwaves, cordless phones and remote control toys. All these apparatus work with the help of radio waves. And radio waves also help transmit music, speech, picture and other data – invisibly through the air.

With the rejuvenation of technology, radio is making a comeback today. According to industry experts as well as analysts, there are as many as 250-300 million radio users throughout the globe. And records reveal that nearly 75% Americans take radio news on their wheels every day. While amongst all the available means of communication, radio has the maximum reach in India compared to most developing countries.

India has 245 commercial radio stations spread across 50 odd cities out of a total of 1600 cities and towns in the country today. Of which, around 70% of Indian population lives in rural villages where there is no access to Internet, electricity or telephone lines as such radio is the only feasible medium for mass communication. Today a mere 179 community-run radio stations are functional in India which is far short of the 4000 stations the government had promised would be set up in 2007.

Radio has been used in different formats for the educational purpose the world around. Attempts were started globally in the early 1970s to apply major developments in applied learning theory, particularly active learning methods, to educational radio for schools, leading to the development of Interactive Radio Instruction.

All India Radio – renamed in the year 1936 from Indian Broadcasting Service is putting out school broadcast programmes from 73 stations in different languages as per the area where the stations are situated. The duration of each programme varies from 15 to 30 minutes having 20 minutes per day in most of the cases.

There are two main ways of doing radio transmission – amplitude modulation (AM) used for long and medium wave broadcasts and the frequency modulation (FM) used for VHF (Very High Frequency) broadcasts. Modulations are the process by which the information to be transmitted is impressed on the radio wave, which serves as a carrier. In AM the strength or intensity of the radio frequency carrier is varied in accordance with the information, while in FM the frequency of the carrier is varied instead of its amplitude.

FM broadcasting is being increasingly adopted as it provides listeners with high-quality signals free from interference these days. FM radio stations are one of the most popular entertainment mediums offering millions of Indians a great mix of shows. Records also reveal that most of the radio listeners in India are from rural areas. And around, 97% of Indian population can access radio stations. Local radio stations have also been set up in different regions of the country. The thrust of the programmes was to be on indigenous folk formats and the participation of the local people.

The first experiment in local/community radio with FM facilities was conducted in Nagercoil and the experiment was launched on October 30, 1984. Several NGOs use local radio to further their development activities. Chetana (Calcutta) and Ravi Bharati (Patna), for instance, record their programmes on adult education, in the field, using local talents.

Radio plays a pivotal role not only in the civilian’s life but also in the soldier’s lives. Indian Organized Olive Uniform personnel who are posted in the Mc-Mohan lines to safeguard India’s Security, unable to access the Internet due to either hazardous communication bottleneck also due to no access to electricity. Consequently, they are fully dependent on the old media which is operated mostly on dry cells. Indian soldiers time and again have to sacrifice their lives for the sake of the country when the war sparkles between Anti-nationals who try to sneak into the Indian Territory to destabilize country’s security.

Robert Browning in his famed poem “Incident of the French Camp” described the heroic efforts of a young French soldier whose breast was shot into two pieces when French Army attacked the German city Ratisbon. Despite his serious nature of the injury, the soldier came galloping to pass the message of victory to Napoleon who was eagerly waiting on a tiny mound. The young soldier conveyed the cheerful victory news to his Emperor and fell to the ground. When Napoleon asked “you are wounded,” the young soldier said “nay sire but I am dead” and the young spirited soldier fell dead smiling.

The young French soldier died when war sparkled in the German city Ratisbon, but old media don’t die in the war. Else, United States Navy would not have used radio facility to prevent its possible use by enemy spies when the United States entered the First World Was in the year 1917.

No much activity

Entertainment Network India Ltd (ENIL) MD and CEO Prashant Panday believes that there will no more mergers & acquisitions (M&A) in the FM radio space due to restrictive rules put in place by the ministry of information and broadcasting (MIB). The Times Group-owned FM Radio Company had recently entered into a non-binding agreement with TV Today Network to acquire three radio stations from the latter on a slump sale basis. The two companies have signed a memorandum of understanding (MoU) on 16 March for the sale of TV Today’s New Delhi, Mumbai, and Kolkata radio stations to ENIL.

“Yes, we plan to complete our acquisition of TV Today’s three metro stations, once the government gives its approval. But beyond this, I don’t see much activity. The rules for Mergers & Acquisitions (M&A) are too restrictive,” Panday told. The ENIL head honcho was referring to the Phase III Grant of Permission Agreement (GOPA) which mandates a lock-in period of three years for largest Indian shareholder from the date on which all FM radio channels allocated to the concerned company stand operationalized under the Phase III regime. Under Phase II, the lock-in period for the largest Indian shareholding was 51%. Panday also said that the government must release more frequencies in metros and big towns for FM radio to realise its full potential.

“The government must realize that by not releasing additional spectrum, it is really wasting an opportunity to provide better services, make more money for itself, and release the full potential of the medium,” he added. He also feels that the restriction on broadcasting news is also unreasonable. “With every single medium freed of controls, why is radio the only medium not allowed to broadcast news? We need news because it helps build stickiness in listenership. The government realizes the importance of radio. It has seen its role during emergencies like floods, terrorist attacks etc. Radio must be allowed to do news,” he noted. He also said that the channel restrictions in a single city should be removed because unless this is done, there will be no consolidation possible in the radio sector. “In no city apart from the top 13 are we allowed to have more than one channel. How do you acquire someone who also has a channel in the same city? There is also an unnecessary national cap of 15% of all frequencies in the country. The government knows all this. I hope it works on these issues,” he stated.

In two keynote speeches at this week’s Asia Media Summit in India, the media industry and the government were in agreement on the need to keep pace with the fast changing media landscape, but had some different opinions on how to do that. In his presentation, Sh Vineet Jain, Managing Director of India’s Times Group, urged the Indian Government to improve media regulation. He said successful media companies no longer think about print or television, they just think of the audience. “There is no reason for the FM radio industry to be as small as it is. The government could double the number of FM stations by halving the spectrum between each channel. Radio broadcasters should be able to offer more format choice. The government would be the biggest beneficiary of such a policy, with more revenue from licence sales.

Panday said that the FY18 was a challenging year for all media companies due to regulatory moves like demonetisation, Real Estate Regulatory Authority (RERA) and Goods and Services Tax (GST). “Starting with demonetisation, then RERA and then GST, business sentiment got badly soured and that affected the fortunes of the media industry. Even in Jan-Mar 2018, the ad industry is weak. Pick up should happen from April 2018 though, as new ad budgets become available to clients,” he said. Panday said that the introduction of more radio stations has helped in growing the revenue. “If it hadn’t been for the new stations, all radio companies would have reported a big de-growth in CY17 and FY18,” he averred.

ENIL had launched second channel stations Mirchi 95 in Bangalore and Hyderabad (both Hindi stations), Mirchi Love in Ahmedabad, Pune, Kanpur, Lucknow, Jaipur, Surat, and Nagpur. “Our Phase-3 station launches have been pretty successful. We have achieved EBITDA break-even within five quarters of launching our Phase-3 stations,” he said. Panday pointed out that the biggest challenge for media platforms is to increase revenues without increasing ad volumes. However, increasing ad volumes is a customer un-friendly move. “In FY18, Mirchi took a call to cut ad volumes. That’s a big sacrifice to make. But listeners have rewarded us. In the latest IRS results, Mirchi has emerged head and shoulders above all other radio stations in listenership! We lead in six out of the top eight metros, leading number two player Red FM by 32% in weekly listenership,” he said.

He also feels that digital is a huge opportunity for FM radio players than a challenge. “Digital cuts into CD sales, maybe downloads, but not into FM listenership. And with digital, we can offer much more variety to our listeners. Ultimately, the overlap between FM and digital is really small, but the world of digital is far bigger, not restricted by FM signal limits etc.” In terms of expansion, ENIL is yet to launch Srinagar station from the Batch 1 of Phase-3. Then there are 21 of Batch-2 stations to launch. “So there is a lot of expansion in FM radio! We just launched our brand in Bahrain two days back. And we will be launching many more online stations in the next 12 months. So expansion is still going on at a fast pace,” he said.

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