New Delhi, July 7: The government Thursday approved a proposal to auction FM radio licenses, which could net the exchequer over Rs.1,733 crore($391 million), and also hiked the foreign investment limit in the sector to 26 percent from the current 21 percent to help expand such services to smaller cities.
 "The FM Phase-III policy extends FM radio services to about 227 new cities, in addition to the present 86 cities with a total of 839 new FM radio channels," Information and Broadcasting Minister Ambika Soni told reporters after the cabinet approved the guidelines for expanding FM radio services.
 "Through the auction of license of the FM Phase III expansion, the government is expecting Rs 1,733 crore of income," Soni added.
 The auction would be conducted on similar lines as was for 3G and BWA spectrum in 2010.
 As per the new policy, all cities with a population of 100,000 and above would get private FM radio channels.
 "Also, the FDI (foreign direct investment) and FII (foreign institutional investment) limit in a private FM radio broadcasting company has been increased from 20 percent to 26 percent," said Soni.

Highlights of new policy

*Radio operators will now be permitted to carry news bulletins of All India Radio

* They will be allowed to broadcast information regarding availability of employment opportunities, public announcements pertaining to civic amenities like electricity, water supply, natural calamities, health alerts among other things

* Private operators can now own more than one channel but not more than 40 percent of the total channels in a city and subject to a minimum of three different operators in the city

* The limit on the ownership of channels, at the national level, allocated to an entity has been retained at 15 percent

* Channels allotted in Jammu & Kashmir, North Eastern States and island territories will be, however, allowed above the 15 percent national limit to incentivise the bidding for channels in such areas

* Only three channels will be permitted in D category cities as against the current four channels to improve advertisement revenues of each player

* Lock-in period of promoter shareholding reduced to 3 years from the current five years.

Lastupdate on : Thu, 7 Jul 2011 21:30:00 Makkah time
Lastupdate on : Thu, 7 Jul 2011 18:30:00 GMT
Lastupdate on : Fri, 8 Jul 2011 00:00:00 IST