Will new govt advisory rekindle radio’s ad business?

Thanks to advancements in technology, Indians now have a plethora of devices at their disposal, when it comes to content consumption. People across social strata now have television sets at home, smartphones, tablets, and computer systems. Most people, however, prefer to consume content on their smartphones.

According to the ‘India Consumer Sentiment Index’, in 2022, over 60% of people tuned in to various types of content on their smartphones. As per the ‘State of Mobile 2023’ report by data.ai, Indians who use Android smartphones, tend to spend close to five hours on their devices every day.

Given the massive number of eyeballs hooked on smartphones, media companies are striving to register their presence on them. While most traditional media businesses have been able to make a mark here, FM radio is still not available on smartphones.

This will, however, change soon. The Ministry of Electronics and Information Technology (MeitY) recently issued an advisory to mobile phone manufacturers. The Indian Cellular and Electronics Association (ICEA) and the Manufacturers’ Association for Information Technology (MAIT), have been urged to ensure the inclusion of FM radio receivers in all smartphones.

As per the advisory, it should be ensured that when a mobile phone is equipped with an inbuilt FM radio receiver function or feature, function or feature isn’t disabled or deactivated, but is kept enabled/activated.

The government identifies FM broadcast as a dependable communication system, especially during natural calamities. As per AZ Research Partners, radio had a credibility score of 6.27 during the COVID pandemic, second only too internet. The disabling of the feature had an impact on the government’s ability to disseminate real-time information, the advisory informed.

“Radio has been used by authorities as the first mode of communication, when it comes to disaster management. The content hosted by FM channels is highly socially responsible. An increased reach will allow us to handle crisis situations in a better way,” comments Ashit Kukian, CEO, Music Broadcast Limited (RadioCity).

FM radio being unavailable on handsets wasn’t the case earlier. At the recently held afaqs! Media Brand Awards, Nisha Narayanan, director and COO, Red FM, said that radio consumption was quite high when it was available on handsets.

“I think radio services were discontinued coincidentally with the upswing of OTT platforms. That’s probably when FM radio was weaned out of the handsets,” she said.

The weaning out of radio from handsets has been a gradual process, according to industry heads. Abraham Thomas, CEO, Reliance Broadcast Network, says that it’s difficult to give a definitive number of decrease in listenership due to this, but there’s definitely been an impact.

“A few years ago, almost 45-50% of radio listenership came via feature mobile phones for us. Although these devices are still responsible for a good chunk of listenership, a high-end smartphone that allows radio transmission is a boon for the medium."

Narayanan of Red FM believes that the best way for the audience to listen to radio is on smartphones as of now. There was a strong need for this advisory because there’s a lobby of smartphone manufacturers that weren’t allowing FM radio to operate on handsets, she added during her conversation with Sreekant Khandekar, co-founder and CEO, afaqs!, at the Media Brand Awards.  

While it’s difficult to ascertain listenership for radio channels, the ad share give an indication. Radio’s share in Indian ad spends, according to the ‘This Year, Next Year 2023’ report by GroupM, is a mere 1%. The ad share has been stagnant since 2021. Six years back, radio’s share in the total ad spends was pegged at 4% by the same report.

However, the industry has recovered from the dip in listenership and advertising in terms of numbers. In 2020, the ad volumes for radio dropped by 27%, when compared to 2019, according to TAM Media research. However, listenership saw a boost in 2021. Radio listenership peaked in May 2021, at 51 million. Overall, radio ad volumes increased seven times during May 2022, as compared to May 2021.

Reliance Broadcast Network’s Thomas shares that the Radio Operators Association of Radio Operators for India (AROI) did research the listening patterns to audio content in the country. 

“It reconfirmed our belief that audio listening is going up. As video consumption is exploding in India, audio consumption is also going up. The availability of the service on mobile phones, which is the preferred device for listening, will further boost viewership,” he adds.

Thomas observes that advertisers are increasingly focusing on reaching out to non-metro areas. To ensure the reach in regional areas, radio has become a prime medium for advertising, he believes. 

“Our biggest markets are Indore, Nagpur, Surat, etc. These markets are growing faster than the metro cities for us . Brands are flocking to radio to reach out to regional (local) markets. This advisory will further increase the advertiser interest in radio,” he adds.

Kukian of Radio City mentions that with the availability of FM broadcast on smartphones, the medium’s reach will definitely increase. This will, thus, add more credibility to the medium in the eyes of advertisers. A radio channel's content is based on a city audience and, hence, the medium consistently reaches out to them effectively.

He says that since the service wasn’t available on phones, it was a natural progression for radio companies to reach out to their audiences via social media. He shares that Radio City focuses on putting out content on social media that could interest people active on social media to tune in to the radio. Its competitors also have been actively venturing in the digital space.

Kukian also says that it’s essential for RJs to be popular for a radio channel, to gain a certain level of affinity with people. “It is the content that a radio channel hosts and the personalities of RJs that gets people to tune in. Now, more people will be exposed to the personalities of RJs and the content and thus will tune in to radios,” he opines.

“Access to the medium on smartphones, will allow audiences to easily move from social media to radio on the same device.” The channels are expecting a greater reach, with the inclusion of transmission on devices.

Now, radio broadcasting and social media, the two medium where these media companies are active, would be available on the same device. Hence, the audience could build a stronger connect with RJs, with the content they put out on social media, and follow them to the FM broadcasts on the same device. This can be the case vice-versa as well.

FM channels can look to connect better with their audiences with the inclusion of the service on smartphones. Radio channels are expecting to gain a greater reach and with this expect greater advertiser interest.