DELHI: India’s telecoms regulator has U-turned on how private radio broadcasters should pay to shift to digital, ditching a convoluted averaging mechanism in favour of simpler reserve prices.
The Telecom Regulatory Authority of India (TRA) issued a corrigendum on 27 October revising recommendations it sent to the ministry of information and broadcasting just three weeks earlier. The original policy, dated 3 October, had proposed that when cities failed to attract bids for new digital frequencies, migration fees for existing broadcasters should be calculated by averaging prices from similar-sized cities—but only if at least two cities in that category had received successful bids.
The authority has now binned that approach. Upon review, regulators spotted that the averaging formula “could lead to certain aberrations in the migration amount vis-à-vis reserve price” in cities drawing no bids. Since reserve prices emerge from a formal valuation model and represent the minimum auction amount anyway, they make a more sensible baseline.
The ministry had sought the regulator’s advice in April 2024 on framing a digital broadcast policy for private radio operators. Under the revised scheme, existing broadcasters wanting to simulcast in digital mode will pay an amount equal to the reserve price for new frequencies, minus the proportionate one-time entry fee already paid for their remaining licence period.
The climbdown suggests India’s radio digitisation may prove trickier than expected—particularly if multiple cities fail to attract fresh bidders, leaving regulators scrambling for fair pricing formulas that don’t distort the market