Digital FM Radio

The Ministry of Information and Broadcasting has announced plans to roll out digital FM radio broadcasting in 13 major cities. This is both a challenge and an opportunity in audio space.

Traditional FM radio has a massive listener base. Digital radio has the potential to expand the reach significantly. The listenership could be doubled or tripled.

The major obstacle is the availability and affordability of digital receivers.

At present, the listenership base for FM stations is of around 200 million. Digital radio could be received through mobile handsets and digital transmission. The listenership base could rise to 400 million.

At present, radio operates under terrestrial music licenses. Whether digital transmission will attract additional fees is to be seen. Maybe, the present licenses will remain valid without any extra fee.

According to TAM, radio broadcasting heavily depends upon local advertising. In the last 15 years, the industry has barely expanded. The total size of the radio industry remains under Rs. 3000 crores. It is the smallest sector in M&E space. To make the industry grow, we should introduce major policy changes — lowering of license fees, opening up air waves for more competition and allowing news on radio.

There are four or five major networks. Smaller players struggle to survive. Local advertisers often delay payments creating cash flow issues.

For FM radio stations, events have become a key revenue stream. Events are a non-traditional revenue stream. Its share years have been 20 per cent. It is increasing to reach 28-30 per cent. It could reach to 50 per cent though digital initiatives, influencer marketing and IPs. The major focus is on community-led events e.g. Durga Puja, Premier League, Film Festival, South Side Story, Music Festivals.