The results of the first batch of Phase III of India’s FM radio auctions have been posted by the Ministry of Information and Broadcasting on its website.
The first electronic auctions of frequencies in the country offered 135 channels in 69 cities and lasted 32 days.
HT Media, the company behind Fever FM, was the top bidder, spending $51.41 million (Rs 3.4 billion) to expand its presence from four cities to 13 by winning 15 licenses.
The company picked up the much sought-after lone frequency on offer in Delhi for $25.58 million (Rs 1.69 billion), and one of the two available in Mumbai for $18.57 million (Rs1.23 billion).
It’s Delhi frequency, 107.2 FM, will be the second along with Fever on 104 FM.
It has also bought stations in Hyderabad and in seven cities across the northern state of Uttar Pradesh (U.P.).
Entertainment Network India Limited (ENIL), the company behind Radio Mirchi, shelled out $51.25 million (Rs 3.39 billion) for 17 new licenses.
This includes $16.5 million (Rs 1.09 billion) for the lone frequency in Bengaluru, and $2.72 million (Rs 180 million) each for two frequencies in Hyderabad.
It has acquired second frequencies in Bengaluru, Hyderabad, Ahmedabad, Pune, Kanpur and Lucknow.
This will take Mirchi’s station count to 49 across the country, up from 32.
Big FM, the radio brand of Reliance Broadcast Network Limited, continues to be the largest network with 59 frequencies, having added 14 new stations to its existing 45.
This includes new stations in Maharashtra/Goa, U.P., Bihar, Jharkhand, Northeast India and Jammu and Kashmir.
The Dainik Jagran group, which owns stations under Radio City and Radio mantra brands, won 11 frequencies, while MY FM owner DB Corp and Rajasthan Patrika got 14 channels each.
Digital Radio Broadcasting Ltd, which runs Red FM in Delhi and Mumbai, bagged three channels, one each in Mumbai, Jodhpur and Srinagar.
Almost 38 frequencies across 13 cities remained unsold, with the bidders focusing more on metros.
Tarun Katial, Chief Operating Officer, Reliance Broadcast Network Limited said: “We have had a successful FY’14-15 with topline growth of close to 30% YoY and 45% EBITDA margin in Radio. We are also looking forward to migrate our existing presence in all metros, mini metros and all key states for a further period of 15 years.”
Apurva Purohit, CEO, Radio City 91.1 FM, said: “We are pleased that we have won frequencies in the markets that we were keen on. This increases our footprint across important cities in each state. Together Radio City & Radio Mantra will be dominant players in important state clusters and continue our successful phase 2 strategy of concentrating on advertiser relevant markets.”
Speaking to LiveMint, Prashant Pandey, CEO, ENIL, said: “After 9.5 years, the government offered one frequency in important cities like Delhi, Bengaluru, Chennai, Jaipur, and Ahmedabad…clearly, the prices reached in these cities is because of ‘scarcity premium’. These are not fair market prices, and the government must consider the auctions to be a failure, not a success. At these prices, the winners will have to do more revenues than even their first frequencies are doing. This is difficult, even if not impossible.”
Vineet Singh Hukmani, MD of Radio One told exchange4media: “We opted out as prices are inflated and we do not want to compromise present profits for speculative growth. The market is growing at 6 per cent and break even at these auction prices is next to impossible. The pressure that employees of networks that have paid huge, unviable prices for auctions will be unimaginable as they have to deliver on listenership and revenue numbers; a pressure they have never witnessed before.”