NEW DELHI: Unfazed by mounting losses - approximately Rs 360 million in the last financial year ended 31 March - Star and Music Broadcast Pvt. Ltd. combine feel that FM radio has immense potential and the launch of Radio City in Delhi on 29 April is a step in that direction.
"From the time FM radio was launched by private players, the average radio listenership in India has gone up from 50 minutes a day to 160 minutes, "Star India's radio division COO Sumantra Dutta told journalists here today, while announcing the launch of Radio City in the Capital.
However, Dutta, an old hand at Star India that was part of the Kaun Banega Crorepati success story on Star Plus in 2000, also said that 10 years back radio listenership was much higher than what it is today, but radio today commands a meagre 1.5 per cent of the total advertising spend.
Asked by indiantelevision.com if the private players feel that there is not much money to be made in this business, what was the reason for them to keep launching radio stations, Dutta said the industry is hoping the government will step in to stem the rot and evolve more industry-friendly guidelines.
"I am sure the government will understand our plight and evolve a mechanism like revenue sharing or a flat fee in the near future, even while coming up with a migration package for the existing FM radio players, like that done in the telecom sector," Dutta said, hoping that a meeting the private FM players were to have with India's information and broadcasting minister Ravi Shankar Prasad later in the day would bear some fruit.
Though Dutta refused to hold forth on the financial details, but according to government data, submitted by the private FM players, the combined loss of the players in the last financial year was to the tune of Rs 1.2 billion. Where Radio City is concerned, it's losses amounted to approximately Rs 360 million with the revenue generated last year being around Rs 190 million. But it is also true that a major part of this loss, about Rs 240 million, was in the form of high license fee that MBPL paid as the first round of licences were given two years back through an open auction.
Still, Dutta is optimistic of cutting down losses by leveraging content from Star.
For example, Radio City and Channel [V] will source content from each other and in certain ventures both the radio and television will act in tandem. Explained Dutta, "We are working towards a scenario where at a certain given time period of the day, Channel [V] will play the video of the song being played out on various Radio City stations."
Even the Popstar's second edition will be done on Radio City as well as on Star's TV channels Dutta said.
But for an industry where advertising revenue is difficult to come by and the clutter is more, it would be a Herculean task if the likes of Radio City reach the break even any time soon.
