The Indian radio sector is going through exciting times. The sector is witnessing a great momentum in FM Phase-III expansion. The ministry of information and broadcasting has issued the notice inviting applications (NIA) for e-auction of 266 FM radio channels in 92 cities in the second batch of private FM Phase-III. The second batch consists of 227 channels in 69 new cities besides 39 channels in 23 existing cities. Out of 69 new cities taken up for auction in the second batch, 20 cities with 80 channels are having population of 3-10 lakh, 38 cities with 114 channels are having population of 1-3 lakh, whereas 11 cities in border areas of Jammu & Kashmir and North-Eastern states with population up to one lakh having 33 channels have also been included.

The issuance of NIA for the second batch will further the process of expansion of FM radio broadcasting services through private agencies (Phase-III) that began with the notification of FM Phase-III policy guidelines in July 2011, and moved forward with the e-auction of the first batch of FM Phase-III. E-auction of the first batch closed on September 9, 2015. The e-auction resulted in 97 channels in 56 cities becoming provisional winning channels with cumulative provisional winning price of Rs. 1156.8 crore. It also paved the way for migration (renewal) of 181 Phase-II licenses to Phase-III.

The first batch comprised vacant channels in existing cities only, i.e., the cities where private FM operators were already present; hence the operationalization of channels in new cities taken up in the second batch will lead to actual geographical expansion of private FM radio.

Amongst the 266 channels on offer, special incentives are being provided to 36 channels in 14 cities in J&K and North-Eastern states. By this, the FM Phase-III policy exudes the government's thrust for concerted development of the North-Eastern states and J&K. It provides much-needed support to the FM radio broadcasting services in cities of North-Eastern part of India as in the cities of J&K and island territories, with provision of annual fee of the channels in these areas at half the rates for first three years, besides provision of Prasar Bharati Infrastructure at half the lease rentals.

The tentative timeline for the commencement of e-auction is September 2016.