The Telecom Regulatory Authority of
India (TRAI) here today issued its recommendations on ‘Migration of FM Radio
Broadcasters from Phase-II to Phase-III’. Phase-I of
FM Radio broadcasting was launched in 1999 and under which 21 private FM radio
channels became operational. Phase-II of FM Radio broadcasting was launched in
July 2005 and 221 more channels were added. As of now, total 242 channels (21
migrated from Phase-I and 221 from Phase-II) are operational. In Phase-III, an
additional 839 channels across 294 cities would be made available for auction.
The salient
features of the recommendations are:
I. TRAI
reiterates early implementation of its recommendations on minimum channel
spacing of 400 KHz for FM Radio broadcast issued on 19th April
2012, which will in effect increase the number FM channels in each city for
auction.
II. The
period of Permission to operate the existing FM channels on migration from
Phase-II to Phase-III will be fifteen (15) years. The Phase-II permission
period was ten (10) years.
III. Cutoff
date for migration is to be decided by MIB after the completion of auction
process for Phase-III of FM Radio. However, the cutoff date for migration
should not be later than 31st March 2015.
IV. For calculating
the migration fees, the cities have been categorized into 3 Groups X, Y &
Z. This classification is based on the numbers of FM channels available in each
city for the Phase-III auction. Group X consists of 17 cities where no channels
are available for auction in Phase-III. Group Y consists of 26 cities where
channels available for auction are 1/3rd or less of the total
channels in that city. Finally, Group Z includes 42 cities where more than 1/3rd
of the total channels in that city are available for auction.
V. Regarding how to
calculate the migration fee, the recommendations vary for the three groups.
(i)
For
Group X, since no auction is possible for the cities herein, the migration fee
is proposed to be derived from the percentage increase in the Phase-III auction
prices obtained in Group Z cities. It is recommended that the migration fee for
the operators in the 17 cities in Group X should be higher of -
· Phase-II average bid
of the city multiplied by a factor of 1.5; or
· Phase-II highest bid
of the city increased by the average increase in auction prices in Group Z
cities (vis-à-vis their reserve prices) in the same category in Phase-III.
(ii)
Group
Y cities are those where auction will be held, but for a few channels. Since
this is deemed to be a scarce market situation, the recommendation is that the
migration fee for the existing channel operators should be higher of-
· Phase-II average bid
of the Y city multiplied by a factor of 1.5; or
· Phase-II highest bid
of the city increased by the average increase in auction prices in Group Z
cities (vis-à-vis their reserve prices) in the same category in Phase-III.
…but, the lower of
·
The
above; and
·
Actual
Phase-III auction price obtained in the city.
(iii)
Group Z
cities, have sufficient FM frequencies available for auction and as such the
actual auction price obtained in Phase-III will be the migration fee.
VI. In
all of these cases, the residual value of the Phase-II permission, calculated
on a pro rata basis, is to be deducted from the Phase-III migration fee.
VII. The methodology
to be adopted for determining the reserve price for fresh cities in Phase-III
should be reconsidered as the current methodology might jeopardise the auction.
VIII. The cities in each group are:
(i)
Group
X - Kolkata, Indore, Baroda, Bhopal, Jabalpur, Coimbatore, Visakhapatnam,
Ranchi, Raipur, Gwalior, Jalandhar, Trivandrum, Kannur, Trichur, Gangtok,
Panaji and Shimla.
(ii)
Group
Y - Mumbai, Delhi, Chennai, Ahmedabad, Surat, Pune, Nagpur, Jaipur, Bangalore,
Jamshedpur, Rajkot, Amritsar, Varanasi, Kochi, Madurai, Bhubaneswar, Siliguri,
Guwahati, Jodhpur, Patiala, Udaipur, Kota, Puducherry, Mangalore, Hissar and
Karnal.
(iii)
Group
Z - Lucknow, Kanpur, Hyderabad, Asansol, Patna, Agra, Allahabad, Vijayawada,
Rourkela, Muzaffarpur, Kolhapur, Nasik, Aurangabad, Sholapur, Sangli,
Ahmednagar, Jalagaon, Dhule, Bilaspur, Akola, Nanded, Chandigarh, Ajmer,
Bareilly, Jammu, Srinagar, Bikaner, Aligarh, Gorakhpur, Jhansi, Kozhikode,
Tiruchi, Tirupati, Mysore, Tuticorin, Tirunelveli, Gulbarga, Rajahmundry,
Warangal, Shillong, Agartala and Itanagar.
The Ministry of Information
and Broadcasting (MIB) had sent a reference dated 9th April, 2013,
to the Authority, seeking recommendations of TRAI on Migration of FM Radio
Broadcasters from Phase-II to Phase-III. The clarifications sought by TRAI were
provided by MIB by 22nd November, 2013.
TRAI issued a consultation paper
on ‘Migration of FM Radio Broadcasters from Phase-II to Phase-III’ on 3rd
December 2013 seeking comments from the stakeholders. Open House Discussion was
held at New Delhi on 3rd January 2013. Taking into account the
comments received during the consultation process and analysis of the issues, the
Authority has finalised its recommendations.
The full text of
recommendations is available on TRAI’s website www.trai.gov.in.
------------------------
KKP