Jaipal Reddy announces 4% revenue share regime: Radio goes Ga-Ga!

"…Radio what's new? Someone still loves you; Radio ga ga (ga ga)…; You had your time - you had the power; You've yet to have your finest hour; Radio-radio…" The lyrics of this 'timeless' song by the immortal rock band, Queen (The Works album, 1984) seem apt two decades later as the Indian Minister for Information and Broadcasting, Dr. S. Jaipal Reddy, brought cheer to the 'bleeding' radio industry players on the last day of June 2005. Just as Queen drummer, Roger Taylor, wrote the song after noticing that kids were switching from radio to MTV, perhaps, the Ministry has realised the potential of 'the cinema of the mind' vis-à-vis 'the idiot box' in the age of 'cluttered ad-skipping' better late than never.

Although all the industry spokespeople spoke in guarded cautious overtones and wanted to check the fineprint before anything else, everyone expressed satisfaction at the turn of events. They were grateful that the Government accepted the recommendations of the Telecom Regulatory Authority of India (TRAI) and facilitated the shift towards a revenue- sharing regime. Private radio FM players operators will now have to pay a fixed 4 per cent revenue share to the Government. Dr. Reddy also announced that 330 FM licences in 90 cities would be given out on the basis of an open bidding process.

Indian radio reaches out to 99 per cent of the population and is the most cost-effective communication medium in the country. Under the Tenth Five Plan, it was proposed that the Government should use FM radio (the preferred mode of communication) to increase literacy and instill a sense of integration amidst geographically diverse regions. It also proposed to encourage private players to start services all across the country. No wonder, A. P. Parigi, MD and CEO, Times Infotainment Media Ltd. (TIML) & Head of Radio Mirchi, expresses that the first reaction is one of relief as the burden has been lightened. “The Honourable Minister, Dr. Reddy, and TRAI have paved the way for the creation of a new India. The telecom revolution was all about connectivity but the new radio policy would enhance the ‘entertainisation’ of the Indian economy. The bulk of the population in India doesn’t have access to electricity, forget television, and radio will plug this communication gap. Simultaneously, the ailing radio industry will get a lifeline.”