Radio in India is still getting over the slowdown caused by Covid. The industry has been significantly impacted by the pandemic both in terms of operations and content. Though the revenue in the sector is increasing, it hasn't yet reached its 2019 levels. 

According to EY-FICCI M&E Report 2024, the revenue of the radio segment was Rs 31 billion in 2019, which dropped to Rs 14 billion in 2020. But with gradual recovery, the revenue level reached Rs 23 billion in 2023. But numerically speaking, the recovery is still just 73 per cent of the 2019 revenue. This leads us to the big question: How will radio survive the pressures created by the cut-throat post-pandemic environment?

Gaurav Dwivedi, CEO, Prasar Bharti, believes there is enough scope for radio to survive and grow. “From the spoken word to the written word to the silent films… radio, movies or OTT, digital media, streaming media, every single one of them still survives. Every single one,” said Dwivedi at the recently held FICCI-Frames.

“The space for radio always remains. It has remained, and I think it will persist, otherwise we won't have the very large number of content producers and self content creators putting out their content not only in video but also in audio forms,” he added.

Nisha Naraynan, CEO of Red FM, also believes radio is not really going anywhere for it connects the Bharat. “It reaches the heartland of the country and to all sections of the society. It reaches to tier 3 and tier 4 towns as well,” she said. 

The EY M&E report has also highlighted the growth prospects for radio, backing it with positive numbers. Ad volumes on radio increased by 19 percent in 2023 as compared to the previous year. Today, India has 1,313 operational radio stations, which is an increase of 90 stations over the previous year. Hence, the growth may have been muted but was never stagnant. 

The problems

The main problem for the radio segment lies in the fact that with an enormous increase in volumes, which was higher in smaller towns at lower yields, ad rates remained soft, falling 8 percent on an average. 

Other than this, a lot of radio stations haven't even reached break-even and are running into huge losses, say industry watchers. 

In an earlier conversation with e4m, Abe Thomas of Big FM had underlined that the radio industry has been specifically grappling with increased competition from new media. Additionally, unlike digital platforms, traditional radio faces limitations in audience measurement capabilities, making it a longstanding challenge for stations. Content innovation is the only way out, he said.

Narayanan also believes the digital ecosystem is measurable, and unfortunately, the measurement system in radio is currently not as everyone would desire because the IRS is still the currency that the industry follows. 

Rahul Namjoshi of My FM has also expressed disappointment over the fact that the industry is fragmented and doesn’t want to come together for rate correction. During the Covid period, the operation slowed down and how. Now it’s time to move towards charging the right price, but currently, under-cutting is what is hampering the growth of the category.

In addition, there is no clear path forward for the implementation of digital radio in a manner that protects the interests of all stakeholders, he rued.

What needs to be done?

Radio is an extremely impactful medium but it is plagued by the lack of a measurement system. While radio stations conduct individual research, there is no research for the overall industry, says Narayan. 

Radio needs to have a level-playing field with other mediums. While broadcasting news is being allowed, extension of licences should be allowed to make the radio industry business-friendly, say the experts.

Since, innovation is key, and no matter where technology heads, content will continue to be the king, radio stations will have to keep coming up with innovative ideas to keep audiences engaged with the medium. 

 Future seems bright

The EY M&E Report expects radio revenues to continue recovering and reach Rs 27 billion by 2026, though ad rates will continue to remain subdued. The increase in DAVP rates for government ads will only help considering this is an election year.

There are distinct chances for radio in India to grow, provided the right opportunities are tapped, as per the report. Considering the hyperlocal nature of the radio product, radio companies are well positioned to build communities to drive D2C relationships, which can be leveraged by brands. 

Growth can also be driven by SME and retail advertiser segments, where spends can be easily attributed to sales. Radio companies can leverage launch of new brands in FMCG, consumer durables and electronics categories. 

“Digital radio is something which is under consideration, and if it comes into play again, I think the measurement system will improve,” Narayanan said.

Other experts also believe the upcoming year looks promising since they are embarking on the digital journey. They believe the combination of Radio+Digital will reap huge benefits. 

The industry as a whole is looking forward to the government's recommendations on news broadcasting, and reduction of licensing fee, which were long pending, and if implemented, will be a boon for the radio category.