TRAI approves 74 per cent FDI in satellite radio

New Delhi: Telecom Regulatory Authority of India (TRAI) has sent its revised set of recommendations on satellite radio, recommending a foreign direct investment (FDI) cap of 74 per cent, along with a 4 per cent revenue sharing for all players who want to offer services on this platform.

Reports in the media indicate that sources in the information and broadcasting ministry are inclined towards accepting the regulator's latest recommendations on the satellite radio policy.

A satellite radio service typically distributes single or multi channel radio programmes using a satellite based system that provides encrypted digital radio broadcasts direct to subscribers' satellite radio receivers.

Presently, in India, World Space is the only satellite radio company that offers such a service. Once the policy is implemented, WorldSpace will have to find a local partner who will hold 26 per cent of its Indian operations, and will have to share 4 per cent of its gross revenues with the government.

The draft policy guidelines differentiate between the provision of satellite radio service (carriage of radio channels) and provision of content (the radio channels themselves). This mandates two different types of licences that are being proposed in the draft policy.

The first type will provide the satellite radio service for carriage and broadcasting of channels, while the second will entitle the permission holder to get registration for satellite radio channels, which he then provide to satellite radio service operator for broadcasting. A radio service provider can also own licences for the channels. The TRAI has recommended an auction of licences if the number of eligible applicants exceeds the number of licences on offer.

The regulator has also accepted restrictions on news and advertisements in satellite radio service as proposed by the government, along with the ministry's proposal to allow terrestrial repeaters for satellite radio service in order to provide high quality widespread coverage.

Licences would be granted for 10 years initially, with provision for extending them for another 10 years. Licensees will have to roll out services within a year of being granted permission.