FM radio channels are pulling out all the stops to stay relevant. In the wake of the pandemic, India’s radio sector shrunk by half to reach Rs 1,430 crore in CY2020 from Rs 3,110 crore in CY2019, according to a FICCI-EY report. With the use of digital radio technology and the return of on-ground events, FM players are optimistic about the sector’s revival, though they are still to reach 2019 levels. Advertisers are also coming back to the medium as is seen from the 14% growth in ad volumes between January and May 2022 compared with last year, as per a TAM AdEx report.
Earlier this year, Entertainment Network India Ltd (ENIL), which owns the Mirchi brand, launched a new audio over-the-top (OTT) app, Mirchi Plus, offering original audio stories, podcasts, entertainment news, etc. Video OTT players reportedly have mon-thly average users (MAUs) of about 600 million, while audio OTT platforms are reported to have about 300 million MAUs. Prashant Panday, MD & CEO of ENIL, doesn’t see any reason why an audio entertainment OTT cannot build a similar reach, given the current ecosystem. “The total cumulative MAUs of the whole audio entertainment OTT business is under 20-25 million. So there is huge room for us to grow this market,” says Panday. ENIL reported a revenue of Rs 95.3 crore in Q1 of FY23 compared to Rs 38.8 crore in the same quarter last year.
Radio City, the FM radio channel from Jagran Prakashan, is adding to its repertoire of regional entertainment to stay relevant. Integrating radio and digital will make way for new advertising opportunities on Radio City, and Ashit Kukian, CEO of Radio City, is optimistic about the company’s revenues coming back to pre-pandemic levels. Music Broadcast Ltd, Radio City’s parent company, reported a 116% growth in revenue at Rs 44.1 crore in Q1 FY23 against Rs 20.5 crore last year.
According to a report from India Cellular and Electronics Association and EY, the adoption of digital radio technology will help the sector double its revenues within five years to Rs 12,300 crore. “Systemic issues around measurement, reach, operating models, competing products, and Covid-19 impacted the segment resulting in failing revenues and shrinking opportunities. Digital radio can help grow the radio segment in India over five years, if implemented keeping in mind the requirements of stakeholders and with the correct policy support,” says Ashish Pherwani, partner, EY LLP (India).
Reliance Broadcast Network’s BIG FM recently unveiled a range of offerings under BIG World for advertisers. Abraham Thomas, CEO at Reliance Broadcast Network, explains that the new offerings are in response to advertisers who are demanding solutions that go beyond pure radio. “As a network, we earn most of our revenues from radio alone, but in the next couple of years, we expect these new solutions to rake in 25-30% of our revenues,” he says.
Stiff competition from OTT audio platforms notwithstanding, Thomas argues that with a strong presence in regional markets, easy and free access, expertise in creating interactive experiences and RJs who are powerful influencers, radio players like BIG FM are well-positioned to thrive in this digital age.
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