The COO and director of RED FM talks about the challenges of running a radio business in India today and how the industry has evolved on the back of the pandemic.
The radio industry has been one of the worst hit industries, as a result of COVID. However, the worst seems to be behind and it continues to reinvent itself to stay relevant in the highly competitive audio market that now includes podcasts, audio OTTs, etc.
Nisha Narayanan, COO and director, RED FM and Magic FM, spoke to Sreekant Khandekar, co-founder and CEO, afaqs!, at the recently held Media Brand Awards (2023) about the evolution of the radio industry and the challenges.
According to Narayanan, COVID changed the trajectory of the industry in more ways than one. The way people consume audio content, as a whole, has now changed. Radio listenership has increased, and independent music and RJs as influencers, have emerged in the scene.
Narayanan states that the industry has been continuously working on reinventing itself to stay relevant to younger audiences.
“It is not either social media or radio, but you have to coexist. The brand stands for ‘Bajate Raho’. We are a provocative entertainer. It is more important to stay relevant as a brand, rather than medium, because mediums will come and go.”
Asked if the brand will drop ‘FM’ from its name, like a close competitor recently did, Narayanan stated that RED FM is proud to call itself a radio channel.
“It is unfortunate when a brand drops ‘FM’ in its positioning. We should be proud of the fact that we are FM/radio, and reach out to the masses. Radio is still an effective channel for brands. Just look at the likes of ‘Mann ki Baat’.”
Talking about revenue streams, Narayanan shares, “At the moment, non-traditional means account for 28-30% of RED FM’s revenue. The vision is to reach at least 45% and be completely dependent on FCT.”
Narayanan spoke about the challenges facing the radio players. For example, licence/auction fees continue to haunt the industry.
“We paid Rs 130 crore for our Mumbai feed called ‘Magic FM’ (15-year licence). We’re in the fifth year now and there’s no conceivable way we can make a profit out of it.”
Another challenge, involves smartphones. According to Narayanan, many smartphone manufacturers aren’t allowing radio to be operational in smartphones, after the emergence of audio OTTs.
“There’s a strong lobby of manufacturers who are not allowing FM (on smartphones) for various commercial and business reasons. It is not fair in a country like India, where FM consumption is quite high.”
“Today, if you visit a store to buy a radio set, it is not available. So, how do you consume radio? The best way is to have it on phones.”
Narayanan hopes that the government will allow radio stations to broadcast news and current affairs.
“About a month ago, TRAI had come up with recommendations on allowing news and current affairs on radio. However, we want to be able to generate our own news and current affairs, and not depend on Prasar Bharati.”
You can watch the entire conversation here: