NEW DELHI: Finally setting the ball rolling, the Government today gave its clearance for the first auction of FM Radio Phase III and migration (renewal) of Private FM Radio licenses from Phase-II to Phase-Ill in 69 existing cities for 135 channels.

The roll out of the first batch of FM Radio Phase III auction will provide more channels to listeners with richer content in 69 existing cities.

The Union Cabinet chaired by Prime Minister Narendra Modi said this will be on an ascending e-auction basis. Approval was also given to migration (renewal) of private FM Radio licenses from Phase-II to Phase-Ill on payment of migration fee according to recommendations of the Telecom Regulatory Authority of India (TRAI).

As of now, with the implementation of two phases of Private FM Radio, Phase I (1999-2000) and Phase II (2005-06), there are 243 private FM channels in operation in 86 cities of the country, spanning 26 States and 3 Union Territories.

The auction process will add an estimated revenue of over Rs 550 crore to the National Exchequer on successful auctions of all proposed channels. Additionally, it will beget the amount realised through the migration process which is dependent on the TRAI recommended formula, where migration fee is linked with the discovery of market prices through the FM Radio Phase III auction.

Radio City CEO Apurva Purohit said, "We are extremely pleased that the final sanction for the clearance of Phase III auctions has been granted by the cabinet. This paves way for the smooth conduction of the auctions and heralds a new era in the FM landscape. Cabinet giving the go ahead means that the Phase III roll-out which has been delayed for more than two years can finally happen this fiscal. It is the much awaited fillip and we are all happy with the movement forward."

Red FM COO Nisha Narayanan, “We are glad to note that the cabinet has approved partial auctions of FM radio hammers in Phase III and also approved migration to third phase based on the migration fee formula recommended by TRAI. This approval is critical for the industry since some of the licenses were getting over on 31 March, 2015. We are extremely happy excited with this development and we look forward to the early culmination of the e auction process."

The Phase III will mean e-auction for 839 FM channels in 294 cities which is expected to commence before the end of the present fiscal, but will continue over the next three years.

The decision relating to Phase III was taken by the Cabinet on 7 July 2011. The Empowered Committee in March, last year, decided to charge a fee for migration to existing operators who wanted to move to Phase III.

The Government has already appointed an e-auctioneer and also an external monitor to ensure probity.

Additional channels may become available due to the reduced channel spacing to 400 KHz – as recommended earlier this year by TRAI- after feasibility studies are completed in consultation with competent technical authorities. At present, the inter-channel (frequency) for FM is 800 KHz.