INDUSTRY REVIEW

PRESENTED BY
:
GROUP A - 2
INDUSTRY
FIRST WAVE OF FM PRIVATIZATION

 Association of Radio Operators of India – AROI.

 July 1999 govt decided to privatize FM Radio
sector.
 Govt offered licenses for 10 year, charging

15% license fee with annual hike.

 In 2000 govt started Phase 1 bidding process for
108 FM radio licenses in 41 cities.
 RadioMirchi bid on 64 stations & won 12 licences.
 RadioMirchi started first from Indore.

 In July 2005 Phase 2 Ministry of I&B auctioned

338 frequencies in 91 cities. Out of these about
250 frequencies have been taken up by private
operators.
SUCCESS STORY
 Common man’s medium.
 Changed Perception of Radio.

 Free to air.

 Not dependent on power.

 Created a colourful image in audience.

 Segmentation of listeners & program

was customized.
 Local language programs.
SUCCESS STORY

 Advertisements.

 Tie up with companies.

 Launching innovative promotion campaigns.

 Made sales team to maintain relation with local

advertisers.
 Price of Ads based on time.

 Additional income from SMS.

YOUTH ORIENTED

 Popular in youths.
 Updated every week new releases.

 Listeners chatted with film stars.

 Program format of local language.

 Feedback from listeners (build consumer

involvement).
 CSR (NGOs).

 Information regarding traffic, health, safety.

MUSIC PROMOTION
 When people hear a song on radio, they feel like
buying the music.
 Radiopromotes old, forgotten music –
generating new revenues for the music industry.
 Radiopopularizes music. Gives music industry
new revenue sources – ringtones, monotones.
 Radiopromotes artists by special interviews,
album promotions etc.
CURRENT ISSUES
 Lack of clarity on music royalties.
 Music is the only content for the radio Broadcaster,
since they cannot presently do News & Current
Affairs.
 Affects viability of radio business, especially in
smaller markets.
 Small towns will not have any FM radio stations.

Market leader Small operator

Radio Revenues Rs 50 lacs Rs 20 lacs
Costs:
Music Royalties expected Rs 223 lacs Rs 223lacs
Other Operating Costs Rs 30 lacs Rs 25 lacs
Loss Rs 203 lacs Rs 228 lacs
IMPLICATIONS ON COST
STRUCTURE

A & B Category Cities

Ot Ma
her rke
Re tin
s
nta g
21
ls M 10 Pa
%
10 usi % yro
%c ll
Ro
yal 34
Metros ty %
25
Ot %
Ma
her
Re rke
Mus
nta tin
22 Pa
sic
ls g
%
Ro yro 33
7%
yal ll %
ty 31
7% %
FM TRENDS IN KERALA
 Kozhikode, Thrissur, Thiruvananthapuram, and
Kochi.
 Malayala Manorama, Mathurbhoomi, Sun
Network, and Asianet.
 Affordable for Kerala audience.

 FM Craze.
FM RENAISSANCE & SOCIAL
CHANGE

 Target– Youth.
 NGO – Community Radio.

 More Investment.

 NRI Investment.

 Less cost on advertising.

RADIO MIRCHI
RADIO MIRCHI - INTRODUCTION

 Nationwide network of private FM radio stations

 Presence in 33 cities and 4 metros

 Owned by the Entertainment Network India Ltd

(ENIL)
 ENIL is the subsidiary of Times Group

 Tagline – ‘It’s hot!’

RADIO MIRCHI - EVOLUTION
 Started as Times FM.
 Began operations in 1993 in Indore.

 It operated till 1998, after that government decided

not to renew contracts.
 In 2000, government auctioned FM frequencies
across India.
 Times Group won the largest number of frequencies.

 It started under the brand name ‘Radio Mirchi’.

 In 2006, bagged 25 more frequencies adding the

total to 33.
RADIO MIRCHI – ADDING SPICE
 Local language programs.
 Updates about new releases.

 Chat with film stars.

 Investment in high quality equipments.

 Smart RJs.

 Voice Clarity.
RADIO MIRCHI - MARKETING
 Advertisements in visual and print media.
 Price of ads based on time.

 Additional income from SMS.

 Innovative promotion campaigns.

 Good content and marketing.

 Information regarding traffic, health, safety etc.

LOCATIONS

 Delhi – 52%
 Mumbai – 44%
 Indore – 40%
 Jaipur – 35%
 Bhopal – 30%
 Chennai – 20%
 Kolkata – 17%
 Bangalore – 10% (AROI 2009)
CONCLUSION
 Emerging Trend in Kerala.
 Huge potential.

 Target audience – Youth.

 More Youth oriented programs.

 Music royalty issue has to be settled.

 Revenue sharing model.

Thank You