IIPM

IIPM, GURGAON

Our strategy is to grow the category. We’re already the largest radio operator in terms of revenues and, hopefully, we will become larger than AIR by the end of this year. So, we will be the single largest radio operator. Our market share in the private space will be 45-50%. But that’s just a part of the pride. The real pride will be if we could grow the category and make it a Rs.1,500-2,000 crore category. That’s going to be the single long-term objective for us.

How will you grow radio as a category?

We are working to improve the regulatory framework to ensure that multiple frequency is allowed to broadcasters and there’s release of more frequencies. Also, the Phase III is important – if the government changes the policies and encourages the launch of radio in 50-70 more towns, it will grow the category. The other thing is that if the quality of research is improved and it can become widespread, then the media buying and planning community, and the advertising one will use more radio, which will eventually drive growth. These are some of the efforts that we are making at the moment.

How will you improve the regulatory scenario in the country?

We look at working with AROI and FICCI to ensure improvements in the regulatory framework. There are 4-5 areas that have been identified by broadcasters. There’s the issue of news and current affairs not being allowed on radio. Multiple frequencies need to be allowed to players in any market. And we shouldn’t forget tradability, which implies that if a broadcaster wants to exit a business, he should be allowed to sell his shares to any buyers. There should be release of more frequency in each market. Finally, networking should be allowed, i.e. one should be able to operate a smaller station out of a big one. For example, if I have a station in Pune, and I wish to operate a new one in Sangli from the Pune one, I should be permitted to do it. This saves costs.

In 2007, why has Radio Mirchi not expanded aggressively?

We think that the viability of new stations is under doubt mainly because of several factors. That is why I mentioned that we would like to work with FICCI to clear up these factors. If that happens, we will be keen participants and look at expanding our network in another 30-40 cities.

Do you think radio can become a mainstream medium for advertisers?

Absolutely yes. When I say mainstream, I don’t mean more mainstream than TV and print, but it can easily become the third in our country. When the one lakh car comes, and if millions buy it, more people will listen to radio. When they reach home, they have 30-60 minutes to watch TV, but during the time they spend in cars (and that’s hours in many cases), they listen to radio. The commutes are going to become longer, there will be more cars on the roads, and so more time will be spent on radio. I believe that this year the industry will be around Rs.700 crore; in another 5 years, it can easily go upto Rs.2,500-3,000 crore

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Source : IIPM Editorial, 2008

An Initiative of IIPM, Malay Chaudhuri and Arindam chaudhuri (Renowned Management Guru and Economist).

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