MIB issues IM for e-auction of FM Radio channels

The Ministry of Information and Broadcasting on Thursday with the Government of India has issued the Information Memorandum (IM) for e-auction of 135 channels of Private FM Radio in 69 existing cities of the first batch in Phase II.

This Information Memorandum (the “Memorandum”) provides information for those parties wishing to bid for FM channels to provide private FM Radio Broadcasting services in the country. It also provides information for the existing Private FM broadcasters wishing to migrate their FM services from Phase-II to the Phase-III regime.

The Ministry of Information & Broadcasting, Govt. of India notified a new policy of expansion of FM Radio Broadcasting through private agencies (Phase III) on 25.07.2011 and an Addendum on Migration from Phase II to Phase III issued on 21.01.2015 (hereafter called ‘Policy’), with the objectives of attracting private agencies to supplement and complement the efforts of All India Radio by operationalizing radio stations that provide programmes with local content and relevance, improving the quality of fidelity in reception and generation, encouraging local talent and generating employment.

The auction shall be undertaken city-wise and channel wise and the reserve price for each city to be taken up in this batch was also set out. Every prequalified bidder may bid for channel(s) in each city within the prescribed limit on ownership of channels for that city.
It also mentions that the recipients of the memorandum intending to participate in the auctions should note that Ministry would separately issue a Notice Inviting Applications (NIA) for participation in the auction which would be conclusive and would take preference.

The objective behind the Auctions include obtaining a market determined price of FM Radio channels through a transparent, fair & Impartial process; stimulating competition in the sector as well as promoting rollout of FM broadcast services to increase FM broadcast coverage.

The government of India is keen that potential new entrants to the Indian Broadcasting sector, as well as existing operators, should be encouraged to take part in the auctions.

The Government aims at obtaining a market determined price of the FM Radio channels through a transparent, fair and impartial process. It also wants to stimulate competition in the sector and lastly, it want to promote the rollout of FM broadcast services to increase FM broadcast coverage.

The Government reserves the right to cancel or postpone the auctions, in part or in full at any stage, without assigning any reasons, in order to safeguard the above objectives. The Government has the sole discretion to determine the relative priority of the objectives and whether the objectives are adequately safeguarded by the auctions.

The FM Channels Auctions will be a Simultaneous Multi Round Ascending (SMRA) e-auction, run over the Internet. Details of auction process will be published in the Ministry’s website separately. Bidders will be able to access the Electronic Auction System (“EAS”) to be used for participation in the Auctions using standard web browsing software.

Prior to the relevant Auction, pre-qualified Bidders will have to procure the Digital Signing Certificate (DSC) Class III issued from an authorized Certification Authority. The DSC of Class III should contain the Signing and Encryption certificate. The Bidders are responsible for ensuring that none of these authentication tokens are released to any unauthorized parties.

Qualified bidders will be provided with a detailed manual explaining how to use the EAS (the “EAS manual”). The authentication tokens will be procured by the bidders in advance of conducting a mock auction, which will be held at a time specified by the Government. The system requirements for bidders are contained in Auction Rules.

Prashant Panday, Director and CEO, ENIL said, “This is an old policy that got endlessly delayed unnecessarily and is now finally seeing the light of the day. It’s great it’s finally happening!”

Harrish M Bhatia, CEO, MY FM, said, “This is the second good news in the last one week, it is great news for the industry. I am happy that PM of India is focusing on radio as a mass medium and is committed to its growth and development.”

Vineet Singh Hukmani, MD, Radio One, said, “FM radio migration and auction commences phase III and this will take radio to 8% of the advertising pie from the current 4.5%. It’s great for clients as this is the only localized economical medium and dovetails wonderfully with digital spend. Clients are all looking forward to this as it is the medium with the highest ROI.” By Archit Ambekar | Twitter: @aambarchit


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