FM radio to generate revenue of Rs 1400 crore in 2012-203: Study
December 21, 2012
Source: MM Network
India's private FM radio segment is expected to generate revenue of around Rs 1,400 crore in 2012-13, with 245 private FM stations operating in 86 cities, a latest study by CII and Ernst & Young said.
As per the study, "Poised for Growth: FM radio in India", the sector has been growing at a Compounded Annual Growth Rate (CAGR) of 14 per cent annually. "Furthermore, the sector is expected to grow to Rs 2,300 crore, at a CAGR of 18 per cent, within three years of Phase III being rolled out," the report said.
According to Indian Readership Survey (IRS) 2012 Q2 data, radio has an estimated audience of 158 million people (out of which FM radio accounts for 106mn), as compared to 563 mn in the TV segment and 352 mn in the print sector. Advertising revenues comprise more than 85–90 per cent of the total revenue generated by FM radio companies.
The key challenges faced by the radio industry as per the report include limited inventory and slow recovery of advertisement effective rates (ERs). "Therefore, the need of the hour for radio industry is to collaborate and implement a measurement system that supports the growth of the industry," it said.
The study further highlights that phase III of FM radio licensing promises further growth opportunities for the Indian FM radio industry, since it covers 294 cities and 839 licenses.