Industry leaders maintain that while the global transition toward on-demand audio is inevitable, regulatory policies have failed to provide private FM broadcasters with a level playing field. Nisha Narayanan, Director and Chief Operating Officer of Red FM, said the key issue is whether the industry is being given a fair regulatory framework that enables broadcasters to compete, innovate, and generate sustainable revenue while adapting to the digital era.
The industry has presented four major demands to the government. Broadcasters have sought permission for private FM stations to air news and current affairs, a privilege currently reserved for All India Radio. They have also demanded a reduction in the Goods and Services Tax on radio services from 18 percent to 5 percent, activation of FM receivers already installed in smartphones through software updates, and the implementation of a revenue-sharing licensing model under which operators would pay a fixed percentage of their actual earnings instead of licence fees linked to historical auction prices.
For millions of Indians, FM radio continues to serve as a reliable source of entertainment and information during daily commutes, in homes, vehicles, and smaller towns where access to digital platforms remains limited. Unlike internet-based audio services, FM radio operates without a data connection and continues to function during power failures and network disruptions, making it a critical medium during emergencies.
The government, however, believes the challenges confronting FM radio extend beyond regulatory issues. Union Minister for Information and Broadcasting Ashwini Vaishnaw stated that the sector is undergoing a significant technological transformation similar to the decline of landline telephones following the expansion of mobile communication and the ongoing transition from conventional vehicles to electric vehicles. According to the minister, every major technological shift inevitably reshapes industry structures.
Addressing the industry's demand to permit private FM stations to broadcast news, Vaishnaw confirmed that the government is examining the proposal. He said the issue involves multiple policy implications and historical considerations, adding that a decision is expected after careful deliberation.
Industry representatives argue that the crisis extends beyond competition from digital platforms. According to the Association of Radio Operators for India, radio has become the only segment of India's media and entertainment industry currently experiencing negative growth. While the country's overall media and entertainment industry expanded by 9 percent to approximately Rs 2.78 lakh crore in 2025, radio revenue declined by 7 percent to around Rs 2,300 crore. The industry's share of advertising expenditure has also fallen sharply over the past decade.
Industry estimates indicate that radio's advertising market share has declined from more than 3.4 percent in 2015 to nearly 1.1 percent in 2025. Private FM broadcasters generated approximately Rs 1,819 crore in revenue during 2025, remaining below pre-pandemic levels despite a significant increase in the number of operational stations.
Narayanan stated that the industry's financial difficulties cannot be separated from the economic disruption caused by the COVID-19 pandemic and the uneven recovery that followed. She said the industry had not anticipated the combined impact of multiple severe challenges occurring simultaneously. According to her, industry revenues dropped by nearly 50 percent from pre-pandemic levels and have yet to recover completely. At Red FM, government advertising volumes have declined by more than 30 percent, while revenue from government advertising remains 27 percent below pre-pandemic levels.
Radio City Chief Executive Officer Abe Thomas said both aggressive industry expansion and policy shortcomings contributed to the present situation. He explained that broadcasters invested heavily expecting rapid growth in local advertising, but demand expanded more slowly than anticipated, while the slow economic recovery after the pandemic further intensified financial pressure.
Thomas added that policy restrictions, including the prohibition on private FM news broadcasting, fragmented implementation of regulations, and delays in policy reforms, have significantly limited revenue generation compared with international markets. According to him, neither market conditions nor policy failures alone explain the industry's decline; rather, the combination of both factors has created the present crisis.
One of the industry's most persistent concerns remains the prohibition on independent news broadcasts by private FM stations. Thomas described the restriction as one of the sector's greatest missed opportunities, arguing that news programming encourages habitual listening, strengthens community engagement, and creates new advertising and revenue opportunities.
Industry representatives note that countries including the United States, the United Kingdom, Australia, and the Philippines have successfully integrated news, talk programmes, sports coverage, and local programming into FM radio formats, allowing broadcasters to remain relevant despite the rapid growth of streaming platforms. They argue that hyperlocal news, civic information, community discussions, and city-specific programming could distinguish FM radio from music streaming services. However, the draft Telecommunications (Television, Radio and Associated Services) Rules, 2026, released for public consultation on June 12, retain the existing restriction on private FM news broadcasting.
Broadcasters also identify the current licensing structure as a major obstacle to long-term sustainability. Industry representatives argue that licence extension fees based on historical auction prices place an excessive financial burden on operators. They are seeking automatic renewal of existing licences instead of requiring fresh auctions.
Narayanan warned that the current batch of FM licences is due for renewal in 2030, yet there is still no clarity regarding the renewal framework, pricing structure, or recommendations from the telecommunications regulator. She said the uncertainty makes it extremely difficult for broadcasters to make long-term investments in technology, talent, and content.
Another longstanding industry demand concerns activating FM radio receivers already installed in many smartphones. Broadcasters say the required hardware exists in numerous devices but remains disabled through software, forcing listeners to access radio through internet-based streaming instead of free terrestrial broadcasts. Narayanan said enabling these receivers would require only a software update rather than additional hardware, describing the move as a simple policy measure rather than market intervention.
She also stressed that radio continues to play a vital public service role in a country where internet access remains uneven. According to her, more than 40 crore people listen daily to All India Radio, private FM stations, and community radio, with radio providing last-mile connectivity without requiring internet access, paid subscriptions, or continuous electricity.
Thomas echoed that view, stating that FM radio remains one of the country's most resilient communication platforms during natural disasters and network outages, making it an essential public-interest service across India's diverse geographical landscape.
Although streaming services, podcasts, and digital audio platforms such as Spotify continue to reshape listening habits, Thomas said FM radio retains significant strengths through hyperlocal relevance, immediate communication, mass audience reach, and public trust, particularly during commuting hours, emergencies, and regional events.
Broadcasters further argue that private FM operators face a substantial financial disadvantage compared with digital platforms. Industry estimates suggest that nearly 40 percent of gross revenue is absorbed by Goods and Services Tax, licence fees, and spectrum-related charges. The sector reportedly paid nearly Rs 999 crore to the government during the financial year 2025-26, while maintaining that the 18 percent Goods and Services Tax places radio at a competitive disadvantage compared with other media segments taxed at 5 percent.
Despite growing concerns, industry leaders remain cautiously optimistic about the future. Thomas said the concept of a traditional radio company is rapidly becoming outdated because audiences increasingly consume content across FM broadcasting, podcasts, streaming services, and social audio without distinguishing between platforms. He believes future growth will depend on building integrated media ecosystems that combine broadcasting, digital content, branded entertainment, live experiences, and regional storytelling.
Industry executives, however, caution that without decisive policy reforms over the next two to three years, many smaller operators may be forced to leave the market, local radio stations could permanently cease broadcasting, and the industry may become increasingly concentrated in urban areas, reducing the diversity of voices that FM radio has historically provided across India.
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