Radio One 94.3FM, the joint venture between Mid-day Multimedia and BBC worldwide, has announced its financial results for the Third quarter ended Dec 31st where in revenue has grown 72% From April to Dec last year.
The company’s PBT operations (before license fee) for April to Dec 31st is positive and has grown by 108% over the corresponding period last year. In the third quarter Radio one grew 49% from Q3 last year where in the Industry has fallen by 6% in the 6 cities as compared to Q3 last year as mentioned by the company.
‘Inspite of a great H1 and a subsequent slow down in Q3 in the industry this year, we have maintained our performance from Q2 to Q3 essentially due to focus on ‘targeted listenership’, ‘efficiency pricing’ and ‘stringent cost control’. Our new stations (Ahmedabad, Pune and Kolkata) operate efficiently with an average of less than 14 people each and our all India costs are lower than the industry average by 39%. Our All India head count in 7 cities is 144 people against the industry average of 235-250 people across 7 metro cities. Our Marketing and Advertising costs are not even 20% of the industry average” said Vineet Singh Hukmani, CEO Radio One 94.3FM.
‘Performance of radio companies would have improved drastically but recession is driving rates of all media down (lead by print) as everyone is chasing outlays and not rates. Even stations that are ranked high in RAM have gone into survival mode and have cut their rates drastically thereby allowing a ‘irreversible commoditization of the industry’. This commoditization further nullifies their past and present expenditure on brand building. The cost of music continues to be very high which further restricts PBT growth. The I&B ministry has to wake up to the genuine requests made by the AROI for support on these fronts especially on extension of license fee period from 10 to 15 years. No player would be looking at getting into phase 3 if these phase 2 problems prevail. 2009 is the year that the I&B ministry will make or break the radio industry’ he added on being asked what the future of radio looks like in 2009.
Radio one is positioned as a metro specialist and operates in 7 cities namely Mumbai, Delhi, Bangalore, Chennai, Pune, Ahmedabad and recently launched Kolkata in Dec 2008 to complete its metro footprint.