FM bidding separates smarter players from rest

NEW DELHI: The recent bidding war for FM radio frequencies has created many winners and losers, but some winners may have won only pyrrhic victories, having bid too much for their stations.

An analysis by DNA Money  shows that while the Sun TV group of Tamil Nadu bagged the maximum number of FM radio frequencies, the Anil Ambani group-backed Adlabs appears to have bid the smartest.

Out of the 57 stations that it won, Adlabs bid the lowest for 27 of them.

Among the successful players in the A and A-plus category cities, it bid the lowest in Hyderabad and Kanpur. Across other circles, it bid the lowest in 10 eastern cities; nine in the north; four in the west; and two in the south.

At the end of the bidding process for FM Round II, Adlabs has bagged 57 radio stations for an entry fee of Rs 171.06 crore.

The company will, however, have to surrender around 12 stations, as no single entity can hold more than 15 % of the total frequencies allotted. The total number of allotted frequencies is 299, including the 21 operational radio stations. The bidding process took place in five rounds - for A and A-plus cities; north (B, C and D categories); west (B, C and D); east (B, C and D); and south (B, C and D).

The leading player, Sun, which participated through two entities - South Asia FM and Kal Radio - also bid smart in many cities. Of the 67 new frequencies that it has obtained in FM-II, Sun bid the lowest for stations across 10 cities. Among the successful bidders, it paid the least for five stations in the west, three in the east, and one each in the south and the north.

For the 67 stations that Sun has won, it paid an entry fee of Rs 190.84 crore. Among other smart bidders was Music Broadcast Pvt Ltd (MBPL), which runs Radio City. Among successful bidders, MBPL’s bid was the minimum across six cities. It bid the lowest in four cities in the west and two in A and A-plus category cities. For 16 new stations, MBPL paid Rs 50.93 crore.

Entertainment Network India Ltd (ENIL), which runs Radio Mirchi, bid the lowest in four cities - two in the south, and one each in the north and A and A-plus cities. In Patna (East), ENIL was the only successful bidder at Rs 5.13 crore. For the 25 new radio stations that it has bagged, ENIL has paid around Rs 130 crore. Others to bid the lowest across cities include Radio Mid-Day (in three A and A plus cities); Radio Today (two A and A-plus); Synergy Media (one A and A-plus and one in the north); and HT Music (one A and A-plus).

All 91 cities that were opened up for FM-II received bids. Despite general apprehensions, even cities like Srinagar, Jammu, Guwahati, Shillong, Itanagar and Aizawl received bids.   In the north, the most expensive city was Chandigarh at Rs 15.61 crore, followed by Amritsar at Rs 3 crore. In the south, the highest bid went to Kochi at Rs 10.11 crore. In the west, Indore was the most expensive city with the highest bid at Rs 5.21 crore.