Be cautious in slow market: Rana Barua

21 Nov,2011

By Robin Thomas


The government has enhanced the foreign investment limit in FM radio to 26 percent from the earlier 20 percent. E-auction for FM phase III is reported to have received a nod from the Union Cabinet. Multiple frequencies if allowed will bring different genres of FM station in the same city, the overall media spends and advertising revenue in radio will see humongous growth. FM stations will soon be allowed to air news although not independent of the government owned AIR (All India Radio), nonetheless it seems good times are ahead for the Indian radio industry.


While the FM phase III rollout has moved a little closer to reality, there is always something to learn from past experiences, even for the Indian radio industry. MxMIndia tries to find out one of the critical learning for the radio industry in FM phase III from the earlier phase I and II. In conversation with MxMIndia, Mr Rana Barua, COO Red FM observed, “One of the critical learning that a lot of us had in phase I and II is not to overestimate the potential of the market. The biggest challenge that lies for all of us is knowing that uncertainty has become such a huge thing today, therefore I think a cautious approach is going to be extremely critical.”


“We should be completely taking cognizance of the fact that there is definitely a slowdown, the clients, advertisers and everybody else is extremely careful about the money they are investing in any form of medium. Taking things for granted and creating business plans for the next two three years seems like a passé now. It is more like making a business model and reviewing it every month” he added.


Mr Barua also shed some light on how Red FM is gearing up for FM phase III. He spoke about Red FMs cautious approach and its keen interest in participating in FM phase III. “We are still weighing the pros and cons but, yes we will be seriously involved in phase III. We are very clear that we would like to be in most of the markets which will have some kind of ROI but, we will weigh the pros and cons, we will see the costs and we will be extremely cautious about the approach. We are looking at towns where we are not available and which are important for the advertiser. So we are definitely looking at this as one of our strategies” explained Mr Barua.

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