Ashish Sinha / New Delhi June 22, 2007
Satellite radio service may get costlier for consumers once WorldSpace, the
only satellite radio company in the country, is asked to pay licence fee as
well as share up to 20 per cent of its annual revenue with the government.
These proposals, among others, are part of an overall satellite radio policy
draft, currently being considered by the Ministry of Information and
In the absence of any policy on satellite radio, WorldSpace does not pay
licence fees or shares revenue with the government.
According to sources, the draft satellite radio policy includes imposition
of a one-time entry fee for satellite operators, up to 20 per cent
revenue-sharing arrangement with the government, a 26 per cent cap on
foreign direct investments for broadcasting news and current affairs.
This move is seen by industry observers as a step from the government to
boost the expansion of the private FM radio network. The broadcast of news
and current affairs is still not allowed on private FM radio.
Even the radio forum of industry body Ficci has asked for the I&B ministry
to promote private FM radio over satellite radio.
In its recommendations, Ficci Radio Forum has asked the I&B Minister
Priyaranjan Dasmunshi for imposing a 4 per cent revenue sharing arrangement
on subscriptions and 20 per cent share in its advertising revenue, annually.
While an FM radio station works only in the range of 70-100 kilometres, a
satellite radio service can be received on special radio sets direct via
WorldSpace radio has about 60,000 subscribers from its 10-city operation.
Consumers can obtain the service by paying for the satellite radio sets
(costs between Rs 1,800 and Rs 3,000) and subscription fees (Rs 1,700 per
In contrast, FM radio sets come as low as Rs 50-100. The FM radio companies
have to pay a licence fee and share 4 per cent of their annual revenue with
the government. For the second phase expansion of private FM radio, the
government collected Rs 907 crore in licence fee for 266 frequencies.
The government is also considering disallowing WorldSpace the use of
A repeater network transforms a satellite radio service to a primarily
terrestrial service fed from satellites, thereby competing with FM radio