UNIT 2 - RADIO

Syllabus
Radio as a medium of mass communication, History of radio in India, Major top radio
programs in the world AIR, Emergence of commercial broadcasting, Private FM radio
Channels, Industry size and growth rate for satellite broadcasting.

RADIO AS A MEDIUM OF MASS COMMUNICATION

All India Radio was formally established on 8th June 1936, though there were few unsuccessful
attempts made by radio clubs in Mumbai and Calcutta. The transistor which was invented during
World War II was mostly used to give information about the war. After independence, more AIR
stations were set up with an objective to increase the reach and coverage of radio. It became one
of the most powerful and effective mass media which could be used as a tool to bring about a
social change and meet the demand of a newly formed nation ‘India’. Since AIR was the only
radio station available in the entire country it enjoyed complete monopoly until the 1990s
liberalization policy. It has contributed significantly in making literature and classical music
popular among listeners. Since radio is portable, compact, easy maintenance, one way audio and
economical medium, it enjoys edge over other medium which either requires literacy or
expensive equipment. Another reason for its popularity as a medium is also because it is easy to
carry and can be listened to anytime/anyplace.

In India after independence more stations were developed, programs revolving around
development projects and government policies were generated to bring about awareness among
the population. In 1957 AIR started ‘Vividh Bharti’ service to provide light entertainment and
compete with Radio Ceylon which was unprofessionally directing a commercial service to India.
Today radio reaches 99.9% of the country’s population providing entertainment in almost all
major languages of the country. Advertisers also prefer radio as it is a low cost alternative to
television. With a wide reach and better cost effectiveness, most of the advertisers prefer to
broadcast their ads on radio. With an ease to reach the local audience, specific ads/ messages can
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be tailor made to attract the audience of a particular area. Radio listening is so widespread that it
has become an excellent medium for advertisers to reach local audiences.

Radio in India is cost effective, available to illiterate, public, mobile, fast and less energy
medium. It is still the only source of information for those who do not have access to television
or have limited power supply. AIR also has an active Audience Research Unit dedicated to
studying audience characteristics and audience feedback. People’s trust in radio is due to its low
cost and simplicity. Relative to the other media, both its capital cost and its running expenses are
small. The medium is cheap to use and can attract a substantial audience. Radio remains
affordable and can be listened to everywhere, even when electricity or connectivity are not
reliable. The medium is therefore one of the most popular means of communication, used by an
overwhelming majority of people.

There are 3 main types of programs broadcasted by AIR news based, music based, and other
audio programs. Some of the most popular and practiced formats of audio programs are news
bulletin, news reel, documentaries, magazine, talk show, interview, panel discussion and radio
drama.

HISTORY OF RADIO IN INDIA

Radio is an important mass media for education and pleasure, especially in a country like India.
It has evolved into a close companion of the common Indian listener throughout its existence in
India. Broadcasting in India actually began about 13 years before AIR came into existence.

In the 1920s, radio made its way to India, where it was first broadcasted by private radio clubs.
Radio Broadcasting began in June 1923 during the British Raj with programs by the Bombay
Presidency Radio Club and other radio clubs. According to an agreement on 23 July 1927, the
private Indian Broadcasting Company Ltd (IBC) was authorized to operate two radio stations:
the Bombay station which began on 23 July 1927, and the Calcutta station which followed on 26
August 1927.

However, at the time, broadcasting expenditures far outweighed revenue. As a result, the
company requested for and was denied a government loan, resulting in the company's dissolution
in March 1930. Many people petitioned the government to keep the service going after the
company was liquidated. As a result, the government decided to take over the stations in
Bombay and Calcutta at the depreciated value of the company’s assets and people under the
company's current agreements. The government took over the broadcasting facilities and began
the Indian State Broadcasting Service (ISBS) on 1 April 1930 on an experimental basis for two
years, and permanently in May 1932 it then went on to become All India Radio on 8 June 1936.
When India attained independence, there were six radio stations within Indian territory, at Delhi,
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Bombay, Calcutta, Madras, Tiruchirapalli and Lucknow. As a result, broadcasting in India is

now under the direct jurisdiction of the Ministry of Industries and Labor. A central broadcasting
advisory council was established to provide advice to the government on issues concerning the
management and growth of broadcasting in India.

Broadcasting in India is a national service, developed and operated by the Government of India.
All India Radio operates this service, over a network of broadcasting stations located all over the
country. All India Radio (AIR), officially known as 'Akashvani' since 1956. It is the largest radio
network in the world, and one of the largest broadcasting organizations in the world in terms of
the number of languages broadcast and the spectrum of socio-economic and cultural diversity it
serves. AIR's home service comprises 420 stations located across the country, reaching nearly
92% of the country's area and 99.19% of the total population.

Private participation wasn't allowed until 1993 when the government experimented with a daily,
two-hour private show slot on the FM channels in Delhi and Mumbai. In 2001 the first phase of
private sector participation (FM Phase I) India's radio sector began and the government
conducted open auctions for radio licenses.

In December 2002, the Government of India also approved a policy for the grant of licenses for
setting up of Community Radio Stations to well established educational institutions including
IITs/IIMs. On 1 February 2004, Anna FM was launched as India's first campus “community”
radio station by the students of Anna University.
In 2006, the Government of India amended the community radio policy which allowed the
agricultural universities, educational institutions and civil society institutions such as NGOs to
apply for a community radio broadcasting license under the FM band 88–108 MHz.
As a national service, it is catering to the complex needs of a vast country. Radio seeks to
represent in its national and regional programmes, the attitudes, aspirations and attainments of all
Indian people and attempts to reflect, as fully and faithfully as possible, the richness of the Indian
scene and the reach of the Indian mind.

MAJOR TOP RADIO PROGRAMS IN THE WORLD AIR

Top Radio Channels and Programs in India are as follows:

● ALL INDIA RADIO

Officially known as Akashvani, is the national public radio broadcaster of India. It is the largest
radio network in not only the country but of the world and houses different sections such as the
Drama Section, the FM Section, the National Service, etc. established in the year 1936, it
currently has 420 stations located across the country that reaches 99.19% of the total population.
All India Radio is a division of Prasar Bharati and has its headquarters in New Delhi.
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● RADIO MIRCHI (Frequency 98.3)

Owned by Entertainment Network Of India Ltd is the number one FM broadcaster in Delhi,
Mumbai and top 8 metros taken together. It also has stations in UAE , Qatar and Bahrain. Its top
running programs are ‘Meethi Mirchi' , 'Top Mirchi’ and ‘Filmy Mirchi’.

● FEVER 104 FM (Frequency 104)

Fever 104 FM is the fastest growing Contemporary Bollywood Station. It usually plays
Bollywood music and is famous in cities like Chennai ,Mumbai and Delhi and is available in 13
cities. Its top programs are ‘Mad Mornings’ , ‘Picture Pandey’

● RADIO CITY (Frequency 91.1)

Radio City is the first private FM radio station of India started in 2001. Its top running programs
are ‘ Kai Mumbai', ‘City Rise’ , ‘Radio Nasha' and 'Love Guru’.

● RED FM (Frequency 93.5)

Red FM is a Chennai based Indian FM radio network that serves in around 57 cities across the
country. It broadcasts its content in various languages including Hindi, Bengali, Telugu ,
Kannada and Malayalam. Top major programs on the channel are ‘Mornings with Malishka’,
‘Mumbai Local’.

Top major radio channels and programs in world are as follows:

● BBC RADIO
BBC Radio is an operational business division and service of the British Broadcasting
Corporation (which has operated in the United Kingdom under the terms of a royal charter since
1927). The service provides national radio stations covering the majority of musical genres, as
well as local radio stations covering local news, affairs and interests. It also oversees online
audio content. Throughout its history the BBC has produced many radio programmes.
Particularly significant, influential, popular or long lasting programmes include ‘Any questions’
‘The Goon Show’ ‘Friday Night is Music Night’.

● CAPITAL FM
Capital Radio FM is an English Radio Channel broadcasting from Uganda and covers the rest of
the world through a streaming service on the station's website. It boasts top programs named
‘Big Breakfast Show’ ‘AM-PM Show’ ‘The Overdrive’.

● SIRIUS XM RADIO
It is an American broadcasting company in New York City that provides radio and online radio
services. It was formed in 2008. Its top program was ‘Top 40 Hits’ '80’s Pop Hits’ ‘New
country’.
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Emergence of Commercial Broadcasting

A television advertisement (also called a television commercial, TV commercial, commercial,

television spot, TV spot, advert, TV advert or simply an ad) is a span of television programming
produced and paid for by an organization. It conveys a message promoting, and aiming to
market, a product or service. It is generally recognized that the first radio transmission was made
from a temporary station set up by Guglielmo Marconi in 1895. On November 2, 1920. On
November 2, 1920, station KDKA made the nation's first commercial broadcast (a term coined
by Conrad himself).

TYPES OF COMMERCIAL BROADCASTING:

Broadcasting is the distribution of audio or video content to a dispersed audience via any
electronic mass communications medium, but typically one using the electromagnetic spectrum
(radio waves), in a one-to-many model. Broadcasting began with AM radio, which came into
popular use around 1920 with the spread of vacuum tube radio transmitters and receivers. Before
this, all forms of electronic communication (early radio, telephone, and telegraph) were one-to-
one, with the message intended for a single recipient. The term broadcasting evolved from its use
as the agricultural method of sowing seeds in a field by casting them broadly about. It was later
adopted for describing the widespread distribution of information by printed materials or by
telegraph. Examples applying it to "one-to-many" radio transmissions of an individual station to
multiple listeners appeared as early as 1898.

Over the air broadcasting is usually associated with radio and television, though more recently,
both radio and television transmissions have begun to be distributed by cable (cable television).
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The receiving parties may include the general public or a relatively small subset; the point is that
anyone with the appropriate receiving technology and equipment (e.g., a radio or television set)
can receive the signal. The field of broadcasting includes both government-managed services
such as public radio, community radio and public television, and private commercial radio and
commercial television. Transmission of radio and television programs from a radio or television
station to home receivers by radio waves is referred to as "over the air" (OTA) or terrestrial
broadcasting and in most countries requires a broadcasting license. Transmissions using a wire or
cable, like cable television (which also retransmits OTA stations with their consent), are also
considered broadcasts but do not necessarily require a license (though in some countries, a
license is required). In the 2000s, transmissions of television and radio programs via streaming
digital technology have increasingly been referred to as broadcasting as well. Commercial radio
got a big boost in India following the introduction of FM radio.

The goal of the government in popularizing FM radio, which is the short form of Frequency
Modulated radio, was to improve program content, and give listeners a wider choice of programs
by allowing private players to set up radio channels. There have been two major initiatives in the
introduction of FM Radio. In Phase I that was introduced in 1999, 21 channels were set up in 12
cities. In Phase II that was initiated in 2005, the FM radio market literally exploded in India. The
number of FM channels grew to 242, and their footprint spread across 85 cities. Phase III aims to
take FM radio to towns with one lakh population. Once this is formally launched, the FM radio
will be available in 294 cities and the number of FM channels will jump to 839. The main source
of income of FM radio is advertising. However, it is not as lucrative as TV or print advertising,
and most FM radio channels are struggling to break even. Together, FM radio manages about
four per cent of national ad revenues. However, most of this is shared by the top five FM radio
channels.

The key reason for this is the popularity of radio. According to Indian Readership Survey data
for the second quarter of 2012, the estimated audience of radio in India is 158 million. Of this,
106 million are FM radio listeners. The TV channels, on the other hand, have a viewership base
of 563 million while the print media reaches 352 million. India got its first commercial radio in
1967 when Vividh Bharati started airing commercials. This followed the recommendations of the
Committee on Broadcasting and Information Media, which is better known as Chanda
Committee.

The Committee in its report submitted in 1966 recommended

that “for additional resources for expanding the network and
improving the programs, advertising would be the most
fruitful source of revenue” for All India Radio. The first
commercials were beamed from the Mumbai-Pune-Nagpur
beam of Vividh Bharati. Some of the popular programs
broadcast on Vividh Bharati are Jaimala, Special Jaimala,
Hawa Mahal, Inse Miliye, Sangeet Sarita, Bhoole Bisre Geet,
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Chitralok, Sargam Ke Sitare, Ujale Unki Yaadon Ke, and Chhayageet. These programs have
entertained generations of radio listeners in India.

PRIVATE FM RADIO CHANNELS

Radio is one of the fascinating media available today with its unique characteristics of mobility
and cost-effectiveness. Though there are more glamorous media available today, radio continues
to be the potential mass media providing its audience with information, education, and
entertainment. In India, All India Radio was the pioneer in public service broadcasting for more
than three decades till the government announced the privatization of broadcasting in the 1990s.
The private players revolutionized the entire broadcasting sector especially after the government
opened licenses to them. The emergence of private players has shaken the Monopolistic pride of
AIR thus challenging their business model of public broadcasting to revenue sharing model.

Private participation wasn't allowed until 1993 when the government experimented with a daily,
two-hour private show slot on the FM channels in Delhi and Mumbai, In 2001 the first phase of
private sector participation (FM Phase I) India's radio sector began and the government
conducted open auctions for radio licenses. Of the 108 licenses issued, only 22 became
operational in 12 cities. Radio City Bangalore, which started on July 3, 2001, is India's first
private FM radio station. The second development phase of radio privatization was in 2005(FM
Phase II) with 338 FM slots up for auction. 245 frequencies were taken up in the auction and the
government earned US$295 million in one-time entry fees. In 2019 the Ministry of Information
and Broadcasting (India) sought the Telecom Regulatory Authority of India's recommendation
on reserve prices for auctions of radio frequencies in 283 cities to expand private FM radio
across the country. This includes 23 existing cities where the government has auctioned private
FM radio frequencies in the previous batches, while 260 cities will see auctions of private FM
radio for the first time. In 2020 April TRAI issued recommendations on reserve price for the
auction of FM radio channels under FM Phase III policy.

The major private radio players in India are Entertainment Network India Limited which hosts
Radio Mirchi, BIG FM 92.7, Jagran Prakashan Group's, Music Broadcast Limited which hosts
Radio City (Indian radio station), D B Corp Ltd. which hosts My FM & Sun Network which in
turn hosts Red FM. Currently, there are371 private FM stations operating in 07 cities in India.
Out of these, 31 are operated by micro, small & medium enterprises (MSMEs).

INDUSTRY SIZE AND GROWTH RATE FOR SATELLITE BROADCASTING

Radio is a cost effective, portable, accessible and universal medium that gives Infotainment
(information & entertainment) to the masses, almost free of cost. Developments in the field and
evolutions in the technology from AM, FM to Satellite and Internet Radio have made a huge
impact on the Radio Industry in India. Radio offers different services catering to the different
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regions and people of India. All India Radio or Akashvani is the national broadcaster, a
constituent of Prasar Bharati (Broadcasting Corporation of India) within the Ministry of
Information and Broadcasting. Since its beginning, radio has been growing at a steady speed and
it is now the second fastest growing sector after the Internet in India. The radio industry has
managed its growth by increasing the advertising list, not by increasing prices of the sets. Private
FM radio in India is growing at a challenging 14.5%, primarily due to FM expansion in Tier 2
and Tier 3 cities. Although the adpie continues to be only 4%, it is hoped that it will grow to 7%
in India by 2020.

RADIO BROADCASTING IN INDIA

Radio as we know is the first electronic medium before the emergence of television. Though
popular definition has portrayed radio as a blind medium, referring to the medium’s failure for
visualization of its content, radio’s capability in influencing its listeners has been unchallenged.
Radio ranks as the most popular means of disseminating information. It is very appealing
because of its distinguishing features of interactivity, its capacity to provoke dialogue and its
ability to seek the participation of the local population along with lower production costs and
extreme resourcefulness.

Radio broadcasting in India started in June 1923, with the Radio Club of Bombay. Since India’s
Independence, radio has acted as a tool for building the nation. The phenomenal growth achieved
by All India Radio (AIR) has made it one of the largest media organizations in the world. With a
network of 262 radio stations, AIR today is accessible to over 99 percent of the entire population
of the country and nearly 92 percent of the total area. A Broadcasting giant, AIR today
broadcasts in 23 languages and 146 dialects catering to a vast spectrum of socio-economically
and culturally diverse populace. At present, All India Radio has 469 Broadcasting Centers with
249 Relay centers, 220 full-fledged studios and 86 Local Radio Stations. There are 5 Community
Radio Stations. Indian radio grew 6.7% in 2017. The launch of new stations has expanded the
target audience while resulting in a wider reach of the medium with increase in revenue income.

The important factors for growth of Radio in Media and Entertainment segment in India are:

1. Popularity among the Youth

2. Growth in the quantity and quality of Bollywood music on radio

3. Built-in radio receiver in most mobile phones (both feature phones and smartphones)

4. On-the-go (car radio) devices

5. Rural masses who have access to radio

6. Expansion of FM radio stations with new programs and musical content

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7. Radio remains the most inexpensive and portable medium

8. Radio advertising

9. Growth in community radio stations

10. Satellite broadcasting

11. Internet Radio

Radio has undoubtedly made a strong-hold in the market. Radio is expected to be the second
fastest growing medium of communication (FICCI-KPMG) with an exponential growth rate of
16% CAGR over FY 2012 to FY 2018. Its reach and creativity has made it a favorite among the
masses and the advertising world. The size of the Indian radio industry is expected to reach US$
745.65 million by 2021, up from US$ 399.26 million in 2017. Phase III of e-auctions for FM
radio licenses will provide an impetus to the segment. Radio advertising is another area likely to
experience accelerated growth in the years to come.

According to the 2011 census, 67 million households in India have a radio or a transistor.
Minister of State for Information and Broadcasting, Rajyavardhan Singh Rathore said that the
government has taken a number of initiatives for expanding the FM radio network across the
country. As of now, the FM radio network covers 52 per cent population and it is soon expected
to expand to 65 per cent population in the country. There are 57 All India Radio towers shared
with private FM broadcasters on rental basis. In addition, 37 Doordarshan towers are also shared
with private FM broadcasters on rental basis.

MAJOR BROADCASTING MARKET

India has one of the largest broadcasting industries in the world with approximately 892 private
satellite television channels. There are 243 FM radio channels and 190 operational community
radio networks. The Ministry of Information and Broadcasting (MIB) has officially completed
all the four phases of digitisation, As of March 2017, a total of 64.4 million set-top boxes
(excluding Tamil Nadu) were set up in Phase 3 and Phase 4 areas. Total of 243 FM channels (21
from the Phase - I and 222 from Phase – II) are now operational. Under phase III, the Cabinet
has already given permission to 135 FM channels in 69 cities to operate.

Radio, animation and VFX, gaming and digital advertising are also emerging as fast-growing
segments. During 2008-21, these segments are expected to increase at CAGRs of:

➔ Digital advertising - 32 per cent

➔ Gaming - 15.97 per cent
➔ Radio - 10.93 per cent
➔ Animation - 13.34 per cent
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Listening to the news or music while driving or traveling without having to carry additional
content will continue to be popular. The segment is also driven by advertising since most of all
radio content is free. Avasant expects the US$45 billion segment to grow at about 3% year-on-
year for the next five years. With increasing use of the internet and other digital resources,
Digital Advertising is expected to grow at the fastest rate among peers like print media, radio and
outdoor advertising.

The next-largest broadcast sector by revenue is likely to be radio, with almost all revenue coming
from advertising; only the US and Canada have managed to nurture a commercially significant
subscription radio market so far. Live radio has remained popular despite the increasing
availability of on-demand alternatives, such as personal and portable music collections,
streaming music services, and podcasts. In the UK, time spent listening to the radio has varied
little in recent years, at about 20 hours per week, with 90 percent of the population listening to
the radio at least weekly. Online has made live radio easier to listen to wherever connectivity is
available. In the US, advertising revenues from online radio alone are forecast to rise to $2
billion by 2021, a significant rise from $1.4 billion in 2016. Radio is making a comeback in the
lifestyles of Indians. New concepts like satellite radio and internet radio have also begun to hit
the market as they come with better sound quality, absence of static, wider variety of
programming options, programs not interrupted by commercials, and live sports broadcasts.

POLICY SUPPORT AIDS GROWTH

FDI (Foreign Direct Investment) limit in radio, including private FM channels has been
increased from 26 per cent to 49 per cent. Private operators are allowed to own multiple channels
in a city, subject to a limit of 40 per cent of total channels in the city. Private players are allowed
to carry news bulletins of All India Radio. Further boost may be given to the radio sector by
charging license fees on the basis of ‘net income’ so as to provide relief to loss- making radio
players.

FM (FREQUENCY MODULATION) RADIO

Edwin Howard Armstrong demonstrated a new invention, - Frequency Modulated radio or FM in

the mid-1930s. He set up his own transmitter for demonstrations and sold the rights to
manufacture FM receiving sets to several companies in America by 1940. World War II added a
new dimension to the growth of FM broadcasting in the globe. FM radio faced several hurdles in
its development thereafter. But, the conditions improved by the early 1960s. In 1965, the FCC
enacted the ‘no duplication rule’ with a view to facilitate the development of FM stations. In the
1970s, FM broadcasting emerged as a profit-oriented industry in America and other nations of
the world. Profits substantially increased for FM since it captured a large number of listening
audiences.

Frequency Modulation (FM) was first introduced in the 1930s but languished until the 1960s,
because few radio sets could receive FM and few homes had high fidelity sound systems that
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could take advantage of FM's improved sound quality. Most of the FM stations simulcast the
same material broadcast on AM, and the same companies as AM stations owned FM stations.
FM began to develop faster after the Federal Communications Commission (FCC) ordered for
standardization of frequency allocations, allocating 100 FM channels in the 88 -108 MHz band.
In what has been termed as a ‘seismic technological shift’ by record producer, Steve Greenberg,
the 1970s saw over 50 percent listeners tuning in to FM. By the 1980s, FM radio listenership
grew to over 70 percent among the global audience, and much higher among the younger
listeners. AM radio has since been relegated to the realm of talk radio as FM radio’s
stereophonic sound was more suited towards the music based content.

FM RADIO IN INDIA

FM broadcasting began in Madras on July 23, 1977 for the first time in India. Until 1993, All
India Radio, a government undertaking, was the only radio broadcaster in India. Later on, the
FM radio stations were established in big metro cities like Delhi, Kolkata, Mumbai, Bangalore,
Hyderabad, Jaipur, Lucknow and other places in the 1990s. The Government of India privatized
the radio broadcasting sector and sold airtime blocks on its FM channels in Indore, Hyderabad,
Mumbai, Delhi, Kolkata, Vizag and Goa to private operators who developed their own program
patterns and contents.

As of December 2015, 243 FM channels were operational in 86 cities in India. 21 private FM

channels were set up during Phase-I and an additional 222 channels were set up during Phase-II.
The government’s objective was to auction 1,000 new FM channels by the end of 2016.
Liberalization of policy on community radio took place in 2008 which led to 29 community
radio stations getting operational in the country. In 2017, the radio industry in India accounted
for a market size of Rs 26 billion (US$ 399.26 million), registering growth of CAGR 8.33 per
cent during 2016-17.

There are three important phases that changed the face of FM radio in India, they are:

Phase I

The Government of India, during the Ninth Five Year Plan (1997-2002), adopted a policy for
improving the variety of content and quality of radio broadcasting that allowed fully owned
Indian companies to set up private FM radio stations. The first phase of FM radio broadcasting
was launched by the Ministry of Information and Broadcasting in 1999. The FM Phase-I Policy
provided for selection of successful bidders through open auction. The objective behind the
scheme was to attract private agencies to supplement the efforts of All India Radio by
operationalizing FM radio stations to provide programs of relevance with special emphasis on
local content, to increase content generation and improve the quality of fidelity in reception. The
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government had the power to fix the annual license fees for private FM broadcasters. In Phase I
of its development, FM was opened to private broadcast channels in Chennai, followed by Delhi,
Mumbai, Kolkata, and Goa, and then Bangalore, Hyderabad, Jaipur, and Lucknow. Regulatory
norms prohibited the broadcast of news and other non-music programming. Hence, the content
was all about music and art (mostly films). In the beginning, the FM stations were not allowed to
broadcast the news aired by the AIR due to policy constraints. But, the private FM stations were
later allowed to rebroadcast news from All India Radio. The Phase-I policy met with limited
success. A total number of 21 channels were operational in 12 cities under this scheme.

Phase II

The Government announced the policy for Phase-II of FM Radio Broadcasting on July 13, 2005.
The major change in the Phase-II policy was that the fixed annual license fee in Phase-I, which
increased 15% per annum over the license fee paid in the preceding year, was replaced with a
revenue share mechanism. In PhaseII, a two-stage bidding process i.e. eligibility and financial
bidding was followed. A total of 337 channels were put on bid across 91 cities having population
equal to or more than 3 lakhs. Of 337 channels, 284 were successfully bid and, after scrutiny,
permission was given for operationalisation of 245 channels spanning 87 cities. In 2005, during
Phase II of its development, 338 frequencies were offered, of which about 237 were sold. FM
radio spread through the country with local players. Programming still had to be confined to
music. Unlike print and television media, the FM radio sector has had to work harder to keep its
head above the water. Even so, for all these years the FM radio industry in India has stuck it out
and managed to survive.

According to a recent FICCI-KPMG Media & Entertainment Report, the radio industry
registered a robust growth of around 24 percent with the top eight metros still dominating the
market, accounting for 70-75 percent of industry revenues. The average growth rate for larger,
established players like 92.7 BIG FM among others was in the range of 15-20 percent. For
smaller players, the average growth rate was in the range of 45- 50 percent. The Phase II of FM
radio in India witnessed a couple of healthy policy changes and developments across the country.
However, Border areas, particularly in J&K, NE States and Island territories, were largely
missing from the FM map. Even those places that were put up for auction could not find takers
due to poor viability. There was a need to promote private FM radio in border areas with
incentives to draw people to listen to Indian radio channels and to check cross border
propaganda.

Phase III

The Government of India announced phase-III of FM in July 2011 which has the following
salient features: permitted carriage of news bulletins of All India Radio (AIR) in an unaltered
form. Information pertaining to sporting events, traffic and weather, coverage of cultural events,
festivals, topics pertaining to examinations, results, admissions, career counseling, employment
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opportunities, public announcements pertaining to civic amenities like electricity, water supply,
natural calamities, health alerts, and so on, as provided by the local administration were to be
treated as non-news and current affairs broadcast and have therefore been permitted. The private
operators were allowed to own more than one channel, but not more than 40 percent of the total
channels in a city, subject to a minimum of three different operators in the city. Networking of
channels was permissible within a private FM broadcaster's own network across the country
instead of in C and D category cities of a region. In the Phase III of FM radio (2013-16), smaller
towns and cities are to be opened up with a view to facilitate community-based FM radio
services in the country. This Phase promises further growth opportunities for the Indian FM
radio industry since it covers 294 cities and 839 licenses.

The Phase III of FM radio licensing promises further growth opportunities for the Indian FM
radio industry. It would facilitate the establishment of FM radio stations in tier-II and tier-III
cities. Uttar Pradesh and Andhra Pradesh will have the highest number of frequencies available
for licensing, followed by Karnataka, Madhya Pradesh, Maharashtra, Tamil Nadu, Gujarat, and
Bihar.

Phase III has also incorporated special incentives for North-East Region, Jammu & Kashmir and
Island Territories. Private FM Radio broadcasters in these areas are required to pay half the rate
of annual license fee for an initial period of three years. Prasar Bharati infrastructure is made
available at half the lease rentals for similar category cities in such areas. While the limit on the
ownership of Channels at the national level allocated to an entity is 15%, channels in Jammu &
Kashmir, North Eastern States and Island territories are allowed over and above the 15% national
limit to incentivize the bidding for channels in such areas.

The biggest factor in the FM radio play will be quick implementation of the much-awaited Phase
III licensing. The hopes of the industry hinge on this one. With the rollout of Phase III licensing,
the Indian radio industry is optimistic about its exponential growth. The industry, which
currently brings in Rs 1000 crore revenue, will see 800 new radio stations, across 300 towns
coming up. With this expansion, FM radio will now touch 90 percent of the Indian population,
making it truly a common man's medium. The doors to expansion will be opened and the
industry expects to see 30 percent year-on-year growth. The future of radio looks hopeful.

MAJOR ISSUES IN BROADCASTING

➔ AIR has already initiated digitisation of its MW and SW radio network which will work in
three phases. However, there appears to be no initiative to digitize in FM radio space either
by public or private FM radio broadcasters.
➔ Even now though new FM licenses have been issued all across the country, news and current
affairs has been barred from private Radio Networks.
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➔ The radio industry will need to realign its focus to emerging cities and the smaller towns as
the major metros get saturated with FMs.
➔ High Licensing fees, very expensive installations and high program production costs.
➔ No proper research and listenership data available. Many private stations conducted their
own study which may be biased.
➔ There is no increase in ad revenue even if there is an increase in listenership.
➔ Govt. introduces new policies for radio development and this leads to increasing competition
among the stations.

CONCLUSION

Indian Radio now enjoys equal importance as television and print media. The development of
radio in India was steady during the 1960s and 70s but accelerated during the 1980s and 90s.
Radio has now become an intimate form of communication and the FM channels like Red FM,
Radio Mirchi, Power FM and others have contributed greatly in developing this strong network.
The industry is growing rapidly and changing for the better, thus it also expects the government
to bring in certain necessary changes in its policies. The requirements are never ending. The only
worrisome part is the ever-escalating prices of radio stations which need to be controlled.

Addition of new content like news & current affairs and sports commentary needs to be allowed
which is pending in the Supreme Court. News is not permitted on private FM. Nationally, many
of the current FM pioneers, including the Times of India, Hindustan Times, Mid-Day, and BBC
are essentially newspaper chains or media, and they are making a strong pitch for news on FM.

Even in the political arena radio plays an important role. For instance, different political parties
like the BJP and Congress have utilized radio during general elections in the best way. They
customized and personalized the advertisements as per the regions. There is also ‘Mann Ki Baat’
which means the government understands the potential of radio.

The right time to launch radio as an affordable, effective, and creative mass medium by creating
more awareness among advertisers, designing creative content, and engaging with events is now.
Overall, the radio industry needs to change the focus to emerging cities like NE capitals, towns
and villages in outskirt areas as well and not only concentrate on the major metro cities of India
like Delhi, Mumbai, Chennai and Kolkata. With new and improved radio stations in the said
places, radio revenues may grow about 12 per cent in a year. For now, the radio in metros have
no more than 3-4 per cent growth in a year. Traditionally radio accounts for 7-8% of advertiser
expenditures around the world. In India it is less than 2% at present. The privatization of
broadcasting is a good thing which is to be welcomed by all and it provides an alternative to the
already available government- operated radio broadcaster, AIR. Privatization has given room for
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multiple voices in broadcasting and this provides a solution to the monopoly and monotony of
the public service broadcaster. It provides a great scope for reaching the listeners and catering to
their needs as effectively as possible.