Friday, May 03, 2013

FM radio phase III e-auction gets nod

The Union Cabinet on Wednesday gave its nod to policy guidelines for FM radio phase III that will open up 294 cities to private radio services. The government will adopt ascending e-auction for the 839 licences that are up for grabs in cities with one lakh population including those in northeast, border towns and UTs. At present 86 cities are covered by FM radio services. 

The FM radio industry has been dead opposed to ascending e-auctions as they lead to spiraling bidding, often to a point to make the cost of an FM radio station so high as to make them unviable. Industry leaders say this sort of auctioning is as good as killing the radio industry, which has been one of India's success stories. 

Finance minister P Chidambaram told reporters after the cabinet meeting that the additional channels that may become "available due to reduced channels spacing to 400 KHz could be considered subsequently after feasibility studies are completed." 

He said it has been decided to charge migration fee from the existing operators on their migration from phase-ll to phase-Ill and the amount of migration fee would be decided after consultation with Trai. 

Earlier, an Empowered Group of Ministers on spectrum headed by Chidambaram had recommendations on the amendments to the policy guidelines for expansion of FM radio broadcasting services. 

When asked about the concerns raised by radio industry on the high reserve price and ascending e-auction I&B minister Manish Tewari said, "There have been extensive consultations since 2011 with all stakeholders including radio station owners, Trai and others through inter-ministerial consultations and an empowered GoM who have reiterated the Cabinet's decision. We have put a process in place that is non-arbitrary and fair. But if there are concerns, we will see how these can be addressed.''