TRAI's recommendations for reserve price for Phase-III FM radio

NEW DELHI: The Telecom Regulatory Authority of India (TRAI) today recommended that the reserve price for FM Radio channels for Phase III in a new city is to be set equal to 0.8 times the valuation of FM Radio channels in that city.

Thus, TRAI said the reserve price for FM radio channels for each of the 253 new cities has been fixed at 80 per cent of the valuation for each city.

In its recommendations on the reserve price for all the 253 new cities, TRAI also said the reserve price in 11 border cities in the ‘Others’ category in Phase-III should be Rs 5 lakh per channel, as approved by the Cabinet in the Phase-III policy.

After considering all comments received from stakeholders during consultation process and further analysis of the issues, TRAI said in a consultation paper that the valuation of FM radio channels in 253 new cities has been worked out as a simple mean of the three valuation approaches. The approaches are based on population of the city; per capita Gross State Domestic Product (GSDP); listenership of FM Radio; and per capita Gross Revenue earned by the existing FM Radio operators.

The regulator said it had received a letter from the Ministry on 16 December seeking recommendations of the Authority on reserve prices for auction of FM Radio channels in 264 new cities as per the Phase-III policy guidelines.

In all 831 FM Radio channels in these cities are proposed to be auctioned through an ascending e-auction process as provided in Phase-III policy.

Out of the 264 new cities, 253 cities have a population more than one lakh according to the census data 2011 and are classified as B, C, and D category cities. There are 798 FM Radio channels in these 253 cities, which are proposed to be put up for auction.

The remaining 11 cities having a population less than one lakh are in the border areas of Jammu & Kashmir (J&K) and the North East (NE) region. There are 33 FM Radio channels in these 11 cities, which are proposed to be put up for auction.

TRAI issued a consultation paper on “Reserve Price for auction of FM Radio channels in new cities” on 6 February. All the comments received were posted on the TRAI website. Subsequently, an Open House Discussion was conducted by TRAI with all the stakeholders on 9 March at New Delhi.