Radio operators’ lobby seeks bailout package from govt
nNEW DELHI: The Association of Radio Operators for India (AROI), an industry body of private FM channels, is seeking a bailout package from the government in view of the severe impact of coronavirus outbreak on the industry.
In a letter to the Union minister of information and broadcasting, Prakash Javadekar, the AROI said that the industry was going through a tough phase with advertising revenues shrinking over the past year, coupled with a steep fall in government ads, and hoped the government will consider its requests for certain concessions it had sought in December 2019.
It added that the industry was pushed further into a crisis with the Covid-19 outbreak, as various services sectors and brands were cutting back on advertising spends.
“This is resulting in an unprecedented financial crisis, with many stations contemplating cutting costs to survive, including cutting down on staff. The industry employs over 20,000 persons and in the current situation, it will be very difficult for the industry to sustain this workforce,” AROI president Anurradha Prasad wrote in the letter addressed to Javadekar.
Given that radio is an important media platform, and an essential service for providing information and entertainment to the citizens of India, AROI asked for a three-pronged bailout package till the economy stabilises.
It sough a one-year moratorium on all licence fees and charges by the government and Prasar Bharti, and restoration of government advertising on radio, besides clearing the long-pending payments from the Directorate of Advertising and Visual Publicity.
The government has drastically reduced its advertising on radio, which earlier accounted for almost 10% of the FM industry’s revenues.
Harshad Jain, chief executive, radio and entertainment, HT Media Ltd and Next Mediaworks Ltd, said most companies’ P&L was under tremendous pressure, especially since they had invested heavily in acquiring licences in Phase III of the radio auctions. “The annual licence fee is 4% of gross revenues, apart from Prasar Bharti rentals, which are also exorbitant. Radio stations do so much pro bono work on behalf of the government and, so, in desperate times, a waiver would be helpful,” Prashant Panday, chief executive officer, Radio Mirchi, said.
“It is important that the government helps restore normalcy in this sector, considering radio remains the last-mile to send the right message to Bharat, or the common man, even today,” said Nisha Narayanan, chief operating officer and director, RED FM and Magic FM.