AP Parigi, MD of ENIL, said that the availability of news would improve FM radio subscriptions. The TRAI recommendations may come into effect in 3-4 months, he told CNBC-TV18.

Excerpts from CNBC-TV18’s exclusive interview with AP Parigi:

Q: What are your initial thoughts on what has come out on news format radio and non-news format, in terms of FDI hiking? Could the government have done more? Is this the first step and do you expect more to come in due course? Is this exactly what you were expecting or do you expect more to come in due course?

A: I would say better late than never in terms of the government’s reform policy. We have been trying to have a dialogue with the government, on a sustained basis, on the need for multiple frequency ownership by the same company and the same city.

This is going to be a multiplier in terms of growth of the FM industry. It will also lay the foundation for diversity of content, which is an overdue demand coming from the listenership community. It augurs very well for the industry.

Q: How would this change subscription and pricing as a whole when you go ahead?

A: We are in the adolescent stage in terms of pricing and return on investment. The companies that have taken necessary steps to invest in capital investment established a national footprint.

If this regulation is accepted by the I&B Ministry and goes through, there are companies which will support the reform process in getting FM radio to millions of Indians, including diversity of content.

As far as the small station, single station owner or medium-sized radio companies are concerned, we still have a challenge. The dialogue is on with the Ministry of Human Resource Development.

In terms of viability of a small or medium set-up, in terms of royalty that we pay music companies, we have begun a dialogue and have approached TRAI for their support and the Supreme Court for amendment to the copyrights.

News is an integral part of radio. It has taken us quite a deal of time to explain to the government that news means radio and radio means news.

Q: This is still at the recommendation stage. TRAI is going to be putting these recommendations to the I&B Ministry. How much time would it take from here for these recommendations to come into effect?

A: To be fair to the government, Phase I of the FM reform policy took time. In phase-II and III, the intention of the government is to hasten the process. So, to give an estimate in terms of number of calendar days a month would be second-guessing the government.

But if we translate the intention, we should do it in less than 90-100 days. We should have the next batch of reforms if the I&B Ministry takes it up with the associations.

Q: What are your thoughts on promoters who will actually be allowed to dilute stake beyond 51% three years from now? Would this actually lead to some sort of thinking from the managements hereon to raise funds by way of equity dilution?

A: At this moment, I am not very concerned about raising money as much as bringing a framework of regulation. When you have multiple licenses and want a balanced consolidation and growth to happen, tradability or transferability has a lot of do with the 51% holding.

It will support and be a multiforce multiplier as far as the radio industry is concerned.