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Industry Review: Presented By: Group A - 2

The document discusses the history and development of the FM radio industry in India. It describes how the government privatized FM radio in phases starting in 1999-2000. This led to growth of private radio operators like Radio Mirchi. It then discusses key aspects of Radio Mirchi's business model like its focus on local languages, youth audiences, and tie-ups with the music industry. The document concludes by noting trends in the Kerala market and issues around music royalties that need resolution for long-term viability.

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Anand John
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50 views20 pages

Industry Review: Presented By: Group A - 2

The document discusses the history and development of the FM radio industry in India. It describes how the government privatized FM radio in phases starting in 1999-2000. This led to growth of private radio operators like Radio Mirchi. It then discusses key aspects of Radio Mirchi's business model like its focus on local languages, youth audiences, and tie-ups with the music industry. The document concludes by noting trends in the Kerala market and issues around music royalties that need resolution for long-term viability.

Uploaded by

Anand John
Copyright
© Attribution Non-Commercial (BY-NC)
We take content rights seriously. If you suspect this is your content, claim it here.
Available Formats
Download as PPTX, PDF, TXT or read online on Scribd
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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

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