Radio stations doze off to save costs

By Sangeeta Tanwar , afaqs!, New Delhi | In Media Publishing | April 28, 2010
Most radio stations, whether in metros or small towns, switch off programming completely between midnight and 5 am. The industry thus saves around Rs 70 crore a year

If a radio station claims to be functional 24x7, in all probability, it's exaggerating. Most radio stations nowadays prefer to keep mum during the graveyard shift - that is, between midnight and 5 am. The schedule may vary somewhat across cities, but most stations prefer to remain silent at least five hours in a day. The only motive is to save costs.

Apurva Purohit, chief executive officer, Radio City, points out, "High operational costs have forced a lot of us to go off-air for a few hours, though we would like to be switched on 24x7."

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Each radio station spends around Rs 1,200-1,600 every hour as music royalty fee. Besides, a cost of Rs 500 an hour has to be incurred to keep the station running. Thus, by shutting down a station for five hours in a day, the broadcaster can save around Rs 10,000 daily, which adds up to about Rs 36 lakh a year for each station. If we assume that about 80 per cent of the 250 stations in the country remain switched off at night, the industry saves more than Rs 70 crore in a year.

In smaller towns, where the listenership during the graveyard shift is as low as one-tenth of the prime time listenership, it makes more sense to shut down radio stations; unlike in the metros, where there is a somewhat decent listenership even during the odd hours.

Soumen Ghosh Choudhury, national business head, Big FM, says, "We studied each of the markets carefully and mapped out listener time preferences, before deciding to turn off stations during the night. The stations are largely in B and C markets, which see a dip in listeners during the late hours."

One could argue that television channels prefer to be on-air during the late hours, even when there is a sharp dip in viewership. So why do radio stations prefer to go off-air?

The difference is that while television channels can afford to be on-air without incurring any extra cost on content - they merely reuse their library; radio stations have to pay a royalty for music played every hour.

Besides, advertisers also stay away during late hours, which further validates radio stations' decision to stay shut. Purohit of Radio City admits that only a few youth brands, targeting a very niche BPO-IT population, are interested in advertising during the late hours. Besides this phenomenon is only restricted to metros.And the fact that 10-second ad-spot rates see a drop of as much as 30-40 per cent in this time-slot further motivates radio stations to stop operations during late hours.

In fact, as per industry estimates, 50 per cent of the advertising revenue goes to metro-based stations; the northern region commands another 30 per cent; and the southern region commands 20 per cent. Moreover, in smaller towns, the radio stations are solely dependent on local advertisers, who are difficult to get during the late-night shift.

A metro-focused channel such as Fever, which is only present in the four metros -- Delhi, Mumbai, Bengaluru and Kolkata, can thus afford to stay awake.

"Fever caters to the youth; and we don't see any reason why we should deny listeners their daily dose of entertainment even for a few hours," says Neeraj Chaturvedi, national marketing head, Fever FM.

Abhishek Thakur, manager, marketing, Radio Mantra, concurs, "Occupation and topography come into play when radio stations decide to switch off programming during certain hours. A place such as Bengaluru, being a BPO and IT hub, lends itself to 24x7 radio stations."

Chaturvedi is also of the opinion that shutting down the radio station isn't always a viable option. "A radio station only saves the music cost by shutting down, and not the electricity cost. In fact, continuous shutting down and restarting of transmitters eats up a lot of energy and affects the longevity of the equipment as well," he concludes.

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