FM broadcaster wins licence, allies with Star

(Posted on 19 December 4:30 pm)

Music Broadcast Pvt. Ltd, a company promoted by the Mittal group, has signed a licence agreement for operating FM channels.

It is one of 16 companies to have signed licence agreements after furnishing bank guarantees amounting to Rs1587.5 million for operating 37 FM channels, according to the United News of India.

Music Broadcast won its licence after committing Rs413 million as bank guarantee. It will be operating from six centres: Mumbai, New Delhi, Bangalore, Nagpur, Lucknow and Patna.

The company looks set to be a major player in the FM wars because of its association with the Star TV Network. Star will handle the service end, essentially ad sales, according to Yash Khanna, Star TV's Head of Communications.

Queried whether Star was also looking at providing content for the channel, Khanna said he could not comment as discussions were still in progress. Details of the contract were being worked out, he said. Once the final agreement had been reached a clear picture would emerge, he added. Though letters of intent were issued to 26 companies for operation of 93 channels, only 16 companies won licences.

However, nine broadcasting companies, who had been successful in the bidding, had filed five cases in Delhi High Court. "These are being heard simultaneously," Information & Broadcasting Minister Sushma Swaraj said in the Rajya Sabha. The modalities of Star's deal with Music Broadcast will be watched with interest as a pointer to how the FM 'wars' may play out.

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