afaqs!

India Radio Forum: How to make small town stations profitable

By Chumki Sen , afaqs!, Mumbai | In Media Publishing | June 02, 2008
The first session discussed the challenges and opportunities for the radio industry, but the discussion moved to the challenges faced by stations in small towns and how there was little help from the government

The & #BANNER1 & # first panel discussion of the India Radio Forum 2008, held in Mumbai on May 30, was moderated by Atul Phadnis, chief executive officer, Media E2E. The panel was called India CEO Panel discussion - State of the Industry - Challenges and Opportunities.

The panel had Abraham Thomas, chief operating officer, Red FM; Anil Srivatsa, COO, Radio Today; Apurva Purohit, CEO, Radio City; M Sebastian, managing director, WorldSpace Satellite Radio; Prashant Panday, CEO, Radio Mirchi; Tarun Katial, COO, Big FM; and Vineet Singh Hukmani, CEO, Radio One.

Anil Srivatsa

Apurva Purohit

Prashant Panday

Tarun Katial

Vineet Singh Hukmani

Atul Phadnis
Phadnis opened the discussion by posing a question to the panel. More and more radio stations are coming up around the country, he said. New issues have surfaced and new concerns are being debated in the public arena. Radio stations in small towns are also garnering the attention of advertisers and listeners alike. What topics have lingered in the minds of the stations' head honchos in this past year? How can the radio situation be improved in the coming years and what are the expectations for 2010?

Purohit said, "A look back at 2007 and I feel satisfied that the AROI (Association of Radio Operators of India) was set up and that the issues that we have taken up till now were the ones that plagued the industry and not individual agendas."

The panel had some common points. Especially on music gradation. Purohit said that music should be graded differently for smaller cities because, with the same kind of money being paid, the smaller cities are reeling under high costs. There has to be some balance in the payment module.

Prashant Panday of Radio Mirchi said that the TRAI (Telecom Regulatory Authority of India) had done a good job on its recommendations of how to make a station profitable - by going into districts. He also said that there should be multiple frequencies. But he mentioned that ultimately, the TRAI can just give recommendations - the government chooses whether to listen or not.

Katial said there was a need for consolidation. There are many small radio stations which have got reach in the districts, but they are not profitable at all.

Phadnis pointed out that if there were more licences, then it would be goodbye in any case to profitability in the short term. Katial replied that since funding is an issue, the business needs a stronger structure.

Discussing the subject of multiple licences in radio, Purohit said that it was obvious that no new players were going to try new genres other than the existing bigger ones. She said she hoped that with the coming of the Phase III licences, both TRAI and the ministry would address the issues of operating multiple frequencies in a city, of allowing news and current affairs on radio, and of growing beyond 90 cities.

Singh of Radio One said it was important to see how the Phase III licences would be issued. He suggested that instead of a format licensing, it should be a model similar to the telecom frequency model. After all, the stations sell the same fare, so the differentiation should begin at the licensing level.

Abraham Thomas of Red FM felt that the mechanism of licensing should be based on formats or genre, but the key point was: the more, the better.

Purohit summed up the discussion by saying, "Metros will succeed if multiple frequencies and genres are allowed. For smaller places, there should be consolidation."

Srivats of Radio Today openly said - even at the cost of upsetting his seniors - that he was asking any channel to partner Radio Today to see if the model worked - so it would be talk radio and music. According to him, talk radio is here to stay. All the panellists appreciated Srivats' courage in experimenting with a new format and succeeding.

Sebastian of WorldSpace said radio should be viewed as a category and policies should be the same across all - satellite, FM and community radio. "We are currently on level playing fields, but we are being pitted unnecessarily against each other," he said.

Purohit agreed with that, but added that first, WorldSpace must decide whether it is a distribution platform or a content provider.

The discussion closed with the question: If television has level playing fields, why not radio?