Bits & bytes
With 245 private radio stations operating across 86 cities and growing at a CAGR of 14% on an annual basis, the radio business in India is expected to generate Rs 14 billion in revenues in 2012-13, according to the latest study titled, ‘Poised for Growth: FM radio in India’, conducted by Ernst & Young (E&Y) in collaboration with the Confederation of Indian Industry (CII).
The report further stated that the sector is expected to grow to Rs 23 billion at a CAGR of 18% in the next three years. According to the study, the sector currently accounts for around 4% the country’s total advertising spend.
Some of the problems faced by the radio industry include limited inventory, inability to demonstrate return on investment and slow recovery of ad effective rates. At present, more than 50% of FM radio is consumed by people at home, followed by people listening in transit (on mobile phones and in-car listening) and out-of-home listening at restaurants, offices and shops. Also about 25% of total radio listenership is now on mobile phones, stated the report. The E&Y and CII report further says that phase III of FM radio licensing promises further growth opportunities for the Indian FM radio industry, since it is expected to cover 294 cities and 839 licenses.
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