The Resurgence of Radio in India: The Re-Entry of Private Players

By: - Mohit RanjanDeepak SharmaSagir AlamPriyamNaveen RijhwaniAshutosh Singh

History of Radio• Radio was invented during the late 1890s• Information and entertainment content started

only in the mid 1910s, first in the US and then in European countries

• Advertising on the radio started first in the US in 1920

• The demand for commercial airtime increased heavily by 1923

• Capability and immediacy of radio made it very popular across the world by the late 1920s

Radio in INDIA• In India, radio broadcasting started in 1927 at Mumbai

and Kolkata with two privately owned transmission stations.

• In 1930, the government acquired these stations and started operating them under the Indian Broadcasting Service

• The radio service also came to be referred to as 'Akashvani.2‘

• Vividh Bharati, AIR's main entertainment channel, was started in the 1960s. Commercial broadcasting was first introduced on Indian radio in 1967. In the mid-1970s, AIR started offering sponsored programs. Radio's commercials started during the early 1980s on its primary channel Vividh Bharati and were extended to other channels by the mid-1980s

Radio in INDIA(Contd.)

•AIR that broadcasted programs in 24 languages (16 foreign and 8 Indian, languages).

•Program's▫Review of Indian press coverage▫News bulletins▫Talk shows on socio-economic,▫Cultural, historical▫Political subjects;▫And classical, folk and popular music

Fm in INDIA• The first FM station was started in Chennai.

By the 1980s• In 1993, the government allowed private

players in the FM sector by permitting them to take blocks (i.e. time slots to offer their programming content)

• Major Players▫ Times FM (of the media giant Bennett Coleman

& Co) ▫ Radio Mid-Day (of the Midday Multimedia

group).

Introduction To Case• The absence of a monitoring for radio

programs that could provide agencies with information to approach clients also contributed to radio's downfall. In 1993, the government allowed private players in the FM sector by permitting them to take blocks (i.e. time slots to offer their programming content) on AIR, for FM transmissions. The purpose of this move was to earn revenues for AIR (by way of license fees) and provide more variety for listeners.

Introduction To Case(Contd.)

• By 1997-98, the private FM business in India had grown to Rs 930 million.

• Private FM channels resulted in decreasing revenues for AIR as these FM channels attracted most of the ad revenues.

• In June 1998, Prasar Bharati3 stopped the operations of private FM channels

• In July 1999, the government again decided to privatize FM broadcasts and came out with a ten-year license deal.

Introduction To Case(Contd.)

•In 2000, the government called for bids for FM licenses.

SWOT Analysis

Strengths Weakness

immense popularity High license fees

extensive reach fixed number of slots per city

easy accessibility lack of basic infrastructure facilities

Varieties of Programs More than 24 languages

Cheap Advertisements lack of creativity in radio programming as compared to TV.

cost effectiveness

Cheap Instuments

Opportunities Threats

Multilingual programs four to five years for the companies just to break even.

Un-Tapped Rural Areas TV /Reality Shows

Costly Equipments Of World-Space

Costly TV Adds

good scripts and innovation in programming

External Environment

•Govt. Policies•Rural Areas•High Cost bidding Prices•Demand of Creativity •Many Succesful Brands Advertising on

Radio

What's Radio Potential

•Low advertisement costs•Extensive reach •Targeting a small/niche audiences, radio

worked out to be much more beneficial•More than 150 million radio•as a source of entertainment.•Using of advanced digital technologies

and superior programming•More targeted programming.

Success Story

•Car Listeners'•House Wives•Late Night program•Advertisements•Scope In India

Conclusions