With the government having completed the process of awarding the second round of FM radio licences, there's a huge buzz in the industry. Coming soon to a station near you will be new entries like Reliance (Adlabs) and the Sun Group (South Asia FM and Kal Radio).
In the middle of all this is Radio City, all of five years old, earlier part of Star group; now held by GW Capital. Music Broadcast Private Ltd, which manages the brand Radio City has won bids for 17 new cities, west India being the largest market in its kitty. Radio City CEO Apurva Purohit takes pride in the fact that the bidding process has been done keeping in mind the sustainability factor. In an interview with Indiantelevision.com's Manisha Bhattacharjee, Purohit also speaks in brief about how the policymakers decisions have smoothen the FM road. Adding further that now the entrants will have to push their brands by creating unique programming and attacking niche markets. Purohit also highlights how Phase II will see changes due to which the market will become very competitive.
Excerpts:
What's your take on the radio industry as of today? All of us now have to push outwards rather than looking at a mere two per cent share. I think the industry leaders have to look at expanding the business. That can only happen in a sense when there is a push out from all the big players. |
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Could you elaborate a bit on the push-out aspect? With new players trying out different kind of segmentation and attacking different niches, (so one push out happens from the consumer end itself, who will increasingly start listening). On the other hand, the organic growth will take place due to geographical expansion of FM markets that have not been exposed to FM earlier. |
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The industry is now looking at having niche stations? There are lost of opportunities that can be explored in music itself. There are lots of non-music options. For example, people can have a chat show station, a classical music station; people can also have only Tamil music station itself across the country. There is enough and more scope in FM radio. |
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Would Radio City explore the niche segment? We have done very well for ourselves as the mass entertainment station. And that's going to be the way for the future for us. |
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How different have you positioned your stations for the existing ones as well as for the future ones? |
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The television landscape is exploiting the mobile platform to its advantage? Is radio industry also witnessing the same? Further, the question arises who realizes the benefit? While we are open to anything, we will obviously be looking at new modes of distribution. At the moment, a lot of mobile companies themselves are offering radio and they are not restricting to a radio station. Obviously, they want to sell their products, the more stations they are able to give to their consumers or the more radio station neutral they are the better it is for them. So I think, the push back is happening from there itself, which suits us. |
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What would be the present size of the FM radio industry in terms of ad pie and viewership? |
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The bidding process of Phase II is over, so what would be the next step? |
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What is your estimate on the size of listenership that is likely to grow over two to three years time? Automatically, there is a huge reach that will benefit advertisers in return. Let's take Radio City, even if it remains 30 per cent, what we say is Radio City existing in four cities. And, later it will offer 21 cities to the advertisers in all the leading cities. So, 30 per cent of the 21 cities is far ahead of 30 per cent of four cities. But the next level of expansion would be 30 per cent within the FM cities and with competition and more stations, the industry is expecting it to grow to 45 to 50 per cent. |
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Are radio players wrestling to have advertisers on board? |
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How much has advertising on radio increased? |
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What is the key slot for radio advertising? Radio City has identified very clear day parts. I don't think the other stations have gone that far in scientifically analyzing and defining the day-part segmentations. We have the mood-map in place. That's working very well with the advertisers' mood for our TG as well as the kind of programming depending on the mood-map. Interestingly, a lot of radio listenership happens at home. Essentially there is no primetime to define. It is fairly stable across the day. There are peak hours at the two driving to work times; morning and evening. |
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What kind of brands does Radio City have on board? |
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How do you manage to meet the dearth of manpower? |
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What about investment in infrastructure? |
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Will Radio City be ready to experiment with different genres of music in different cities? At our Bangalore station, the quintessential, old malayali uncle who lives in every society gives his advice. On the other hand, one and a half hour 'Altaf' concept, which will be on air shortly, we picked up the feature of Hyderabadi Rickshaw drivers, which is a phenomenon. 'Lingo Lella' and 'Sister Stella' were some of shows, wherein the City has incorporated the nuances of the city. In Mumbai, we have 'Kasa Kay Mumbai' and Lucknow holds the flavour of ghazals and shayari. A lot of things have gone right for Radio City, which clearly demonstrates in the listenership share that it enjoys. It has constantly innovated, the fact that it has been there in spite of losses incurred due to heavy licence fees as a 24x7 radio station over the last five years. It has a good position image in the market. It has a clear and distinct position amongst the listeners; it is seen as a friendly, nice and happy station. It is time to take it to the next level. We say that there is a lot of awareness, and a lot of positive disposition towards the station. Now, we can increase the consumers' involvement with it. Therefore, from a brand as well as from the product point of view, we have done a lot of changes. A clear prerogative on day-part segmentation as well as noting the mood-map and music mapping has been brought about. On the outside, we tried to hardwire out position because radio is a very audio medium. Our consumers have an image in his mind, so we have tried to give a brick and mortar feel to that images via the brand campaign. We are aggressively trying to build the emotional connectivity with our listeners from feedback we get. |
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Does the radio industry have a rating system? What is the listenership of Radio City? Yes, the main rating system to track radio listenership is the Indian Listenership Track – ILTS that is conducted by the MRUC (Media Research Users Council). Being early days for Radio, the system is present only in Mumbai and Delhi. Unlike television that has a comprehensive tracking system like TAM, ILT is a recall based survey, which will always have shortcomings. Listenership is defined as a person who claims to have listened to Radio yesterday. There is great fluctuation in the overall listenership figures in every ILT. At the moment, it is claimed recall, there is no system that comprehensively monitors real-time minute by minute radio listenership. Radio Listenership in the rest of the cities in India is measured my NRS / IRS. As per the latest figures available, Radio City has a listenership of 27.08 Lakhs in Mumbai and 41.09 lakhs in Delhi +NCR as per ILT. In Bangalore and Lucknow, the figures are 16.3 Lakhs and 7.1 lakhs respectively. |
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Now with the sudden spurt of interest that followed the unshackling of local FM, will the satellite radio station-WorldSpace that gives consumers sufficient radio choices among traditional radio broadcasters, is it a threat to FM? And will the new stations, get a fillip from new technology -- iPods and MP3 players? No one ever anticipated the cell phones becoming a rage. My mind is that with newer technology, the time spent on listening to radio on the cell will expand. I don't think that it would eat into FM, it will co-exist. On the other side, you can also see with the advent of internet, other mediums like television, newspaper have not ceased to exist. |
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The Government has been fairly liberal with FM radio in Phase II, assuming that the government had also given a go-ahead with news & current affairs how different would the landscape have been? If radio is given the choice to play news & current affairs, it is definitely good for the industry. Certainly, there is merit in getting news and current affairs. Well, the industry will further see segmentation. It will further expand the ad pie as well as the listenership universe. |
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On the other hand, multiple frequencies was another issue which has not been sorted out? Why has the industry been asking for multiple frequencies? At present, whatever changes has been brought in by Phase II, these are really the changes that were asked for. At the moment, the industry is not looking at multiple frequencies. The Phase II is just few months old, so people have to settle in it and let the market grow. |
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Recently, the Information & Broadcasting secretary SK Arora had made an announcement that the government is exploring Phase III of FM radio licences. Which are the smaller towns and cities is Radio City looking at? It is too early to worry about it. |
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What kind of musical fee do you pay? It is a big cost. It can range between five to seven per cent of the cost structure that goes to the music bodies, which is fairly high. |
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Radio City has not won bids for cities such as Chandigarh, Kanpur and Kolkata? What has been you bidding strategy that helped you win the bids for the other 17 cities? The bidding strategy revolves around the business plan. What we believe is the sustainable amount we have bid for. We have the licences at the lowest cost. We have got licences for worth 50 crores where everybody has paid close to 100 crores for the same set. Keeping in mind the business strategy and rational bidding, winning 17 out of 20 frequencies barring three has been fantastic. |
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Is Radio City looking for a foreign partner up to the extent allowed by the government? Right now, we do not need to. We have everything in place, expertise as well as funding. And we have got enough money to run the stations. |
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How does it feel, personally, to be now doing radio biz after having done high profile business like advertising and TV? |