Govt to accept revenue share for FM radio: Reddy


MUMBAI: Information and broadcasting minister Jaipal Reddy's inaugural address at Ficci-Frames 2005 today gave the entertainment industry at large a reason to smile as he reiterated initiates being undertaken by the government, including ways to curb piracy, tax sops and having a regulator

for the broadcast sector.

Reddy also said that there might be some relief for private FM radio players as the government is poised to agree to revenue share model for the players concerned, who had been lobbying for migration to such a regime from the existing model of annual license fee payment.

"At the outset, I wish to reiterate that my ministry is committed to growth of the entertainment sector," Reddy said, emphasizing the need for laying out a clear road map for the entertainment industry where international standards and the localized markets would be the focus areas.

According to him, technology would propel the entertainment sector into the next decade. "There was a time when the world looked at the west, now the east is looking a lot more interesting," he said.

Elaborating on this aspect, the minister said the global animation industry today is growing at the rate of 25 per cent every year and is going to be a $ 1.5 billion dollar industry in 2008. "Studios around the world are looking at cost effective and quality labour, which is our big advantage. Also our IT and labour skills make us the preferred destination for animation work," Reddy said.

Dwelling on the global scenario, the minister said the next global economic powers would be China and India and this is definitely going to have an effect in the entertainment segment as well. " I believe that India will stand to gain from outsourcing that is taking place and will soon become the studio for the world," he added.

If backers of stringent anti-piracy laws were expecting some support, they got it too as Reddy vociferously condemned piracy, terming it as not only criminal, but an 'ethical and aesthetic offense,' which gives a moral blow to the creativity business.

While on the subject of piracy, the minister, making his maiden appearance at Frames, stated that the central government was determined to deal with piracy with an iron hand. In this regard, a state information ministers' meet has been convened on 16-17 April to set the agenda rolling. Entertainment tax, which seems to be a big issue with the industry, will also be tackled at the meeting.

"Entertainment tax will be reduced to its minimum. And the fringe benefit tax, which is under scrutiny, will be taken up with the finance minister (PC Chidambaram) on behalf of the entertainment sector," Reddy said.

In response to Zee Telefilms CMD Subhash Chandra's plea for a level playing field, Reddy offered some solace when he said, "A level playing field will definitely be provided, and India will remain an open country where competition will be encouraged."

Stressing on his pet subject of the need for a regulatory body for the broadcast sector, on the lines of those existing in the US and the UK, Reddy reiterated a Bill to this effect would be introduced in the monsoon session of Parliament. He also said that pubcaster DD's DTH free to air DTH platform will increase channel offering by July.

Dwelling on the radio front, Reddy did not seem to budge from his known stand and said that the medium would be strengthened and expanded. The new twist came in the form of hints that a new radio broadcast policy formulated by his ministry envisages doses of liberal measures and he projected that in the near future, 300-odd private radio stations, both FM and community, might come up.

However, Reddy did admit that for the FM radio sector, Telecom regulatory Authority of India's suggestion on migration to a revenue share model would be accepted. Reddy said, "We are going to be accepting a revenue sharing model for the FM radio stations."

The I&B ministry is also laying emphasis on co-production treaties with other countries that will not only give a boost to the film industry, but also give a fillip to the emerging animation sector in India.

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