135 radio frequencies to go under the hammer next month

Big cities like Delhi will see a pitched battle among the biggies like Big FM, Radio Mirchi and Red FM for one frequency

Come June, the Information and Broadcasting Ministry will announce the third phase of FM radio operations, an exercise that is likely to see a mad scramble for the first 135-odd frequencies which will go under the hammer in metros as well as smaller cities.

Big cities like Delhi will see a pitched battle among the biggies like Big FM, Radio Mirchi and Red FM for one frequency. Those in the radio business say this one frequency in Delhi is likely to see bids moving skyward up to Rs.70 crore.

To fetch Rs. 1,500 cr.

The auction of all 839 frequencies is likely to fetch the government around Rs. 1,500 crore revenue. But for many in the radio business, the government’s decision to not allow news and current affairs on the FM platform is a stumbling block.

There are technical problems too in the allocation of frequencies. Many feel the distance between two frequencies can be reduced if the government wants to make allowances for more players.

The high bidding price for the frequency is another issue bothering the players in a business that is not bankrolled by advertising revenues. For those who have a stake in multi-media, the bid price may not pinch. But for the rest, running a radio station is a prohibitively expensive exercise. Even for the big players paying royalty to musicians and recording companies is one of the many problems coming in the way of a full-scale FM revolution in the country.

Last year, the Telecom Regulatory Authority of India had given its recommendations to the Information and Broadcasting Ministry, explaining the rules on reserve price of cities on the basis of population, listenership and per capita revenue earned by existing FM operators. The government is taking its own time to arrive at a decision.

At present, 243 FM channels are operational in 86 cities. The government hopes to cover all cities with a population of more than a lakh. In addition, 11 other cities with population of less than a lakh and border areas of Jammu and Kashmir and the Northeast are also being looked at.