V. Sridhar

Parent company announces it on its website

The parent company in the U.S. has gone bankrupt

The announcement shocks staff of Indian arm

BANGALORE: Music aficionados accustomed to Worldspace’s crackle-less radio service have been jolted by the company’s decision to suspend operations. The pioneer in Indian satellite radio broadcasting will fall silent from December 31, according to a message sent to subscribers. The company, which started the country’s first digital satellite radio service, announced that its parent company, which filed for bankruptcy protection last year, had decided to “discontinue its subscriber business in India.”

The sudden announcement of the popular service has taken even the company’s staff by surprise. A company technician, who only last week told this correspondent that he installed “on an average, 4 or five new subscriptions every day,” said he is “completely unaware of the development. I have been working with the company for the last five years, this has come as a bolt from the blue,” he said.

The notice issued by Worldspace Inc, the parent company, stated “the potential buyer” of the company had declined to buy the “assets relating to and supporting Worldspace’s subscription business in India.” While it stated it was not in a position to refund the unused portion of subscriptions, it said there might be a “potential remedy” under the bankruptcy provisions prevailing in the U.S. It informed subscribers that a claims servicing company would send a notice to subscribers “sometime early next year” if they sent details of their subscriptions to the company’s headquarters.

Significantly, the announcement only appears on the parent company’s website. The Indian website continues to urge listeners to “keep the music coming.” Also on display on its banner is the A.R. Rahman punch line: “There is so much to hear.”

Noah Sammara, an Ethiopian-American who sought to use the medium to spread AIDS awareness in Africa, founded Worldspace in 1990. It was only much later that the two other satellite radio broadcasters, XM radio and Sirius (both in the U.S.) started operations. Just prior to the bankruptcy filing, the parent company changed its name to 1Worldpace. Its services were delivered via two satellites, Afristar and Asiastar, aimed at the two most popular audiences for satellite radio broadcasting using digital signals. The company’s USP was based on being able to deliver “near-CD quality sound” without the crackles and static noise associated with traditional radio.

Since starting operations in 2001, the Indian operations had expended significantly. With about 4.5 lakh subscribers in India, it contributes to about 95 per cent of the parent company’s revenues.