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TRAI’s Digital Radio Push Faces Static: Broadcasters warn of high costs, low receiver penetration
While TRAI’s new digital radio policy aims to modernise India’s FM landscape, industry experts say unclear migration costs, lack of digital receivers, and absence of incentives could stall adoption. Calls grow for a 5-7 year free transition period to ensure viability.
When the Telecom Regulatory Authority of India (TRAI) unveiled its long-awaited recommendations for a Digital Radio Broadcast Policy on October 2, the announcement was meant to signal the beginning of a new era for Indian radio. The policy outlines a roadmap for the introduction of digital radio services in key cities, starting with a simulcast model that would allow one analog channel and three digital channels to operate on the same frequency.
In theory, this should revolutionise the sector- improving audio quality, enabling more channels, and expanding coverage in remote regions. But in practice, industry veterans and legal experts say the roadmap lacks the economic clarity and consumer readiness needed for a meaningful rollout.
“Broadly, it is too generic an unveiling by TRAI,” says Vineet Singh Hukmani, founder and former MD of Radio One 94.3. “Without knowing the cost of migration to digital radio, existing players will not be enthused- especially since there is no guarantee of digital receiver penetration in the market.”
In September 2024, the recommendations come after TRAI released a consultation paper on formulating a digital radio broadcast policy for private radio broadcasters.
At present, analogue terrestrial radio broadcast in India is carried out in Medium Wave (MW) (526-1606 KHz), Short Wave (SW) (6-22 MHz), and VHF-Il (88-108 MHz) spectrum bands. VHF-Il band is popularly known as FM band due to deployment of Frequency Modulation (FM) technology in this band.
All India Radio (AIR) - the public service broadcaster - provides radio broadcasting services in MW, SW and FM bands. Private sector radio broadcasters are licensed to transmit programs in FM frequency band (88-108 MHz) only. Digital Radio broadcasting will provide a number of advantages over analogue radio broadcasting. The major advantage of Digital Radio broadcasting is capability of broadcasting three to four channels on a single frequency carrier, while ensuring excellent quality of audio for all the channels, whereas in the analogue mode only one channel broadcasting is possible on a frequency carrier. In a competitive environment, digital radio broadcasting can provide exciting new opportunities to radio broadcasters as well as a host of value-added-services to the listeners.
A costly migration with uncertain rewards
Unlike television’s digital switchover, which succeeded with affordable set-top boxes, digital radios are virtually non-existent in India’s consumer market. If broadcasters begin transmitting in digital mode now, they may be broadcasting to an empty audience.
For FM operators- many of whom are already operating at narrow margins- the shift to digital entails massive investment in new transmission towers, equipment, and training. The lack of clarity on cost-sharing or support mechanisms makes this proposition even more daunting.
“Radio players, unlike telecom operators, have never recovered their investments from past spectrum auctions,” Hukmani explains.
“They will surely be wary of another auction model in uncertain times when their current investments are yet to bear fruit, and digital streaming platforms have started to dent advertising revenues.”
He warns that digital radio, at least in its present form, risks becoming a “no man’s land” offering- caught between traditional FM and rapidly expanding digital streaming platforms like Spotify and YouTube Music.
“Make migration free for 5–7 years”
To make digital radio adoption realistic, radio players propose that TRAI and the government introduce a free migration period for existing players lasting five to seven years.
“The migration to digital radio must be made free for a period of 5–7 years for existing players to assess actual consumer acceptance,” he says.
“TRAI should also work with telecom operators and mobile manufacturers to ensure digital radio functionality is available on mobile phones,” said a senior radio industry executive.
The absence of digital receivers is one of the biggest roadblocks.
Unlike in developed markets, where in-car and home receivers are common, India’s digital radio ecosystem is practically non-existent. Without hardware penetration, even the most advanced broadcast infrastructure will fail to reach listeners.
Legal view: “A forward-looking step, but economically incomplete”
Dinesh Jotwani, Co-Managing Partner at Jotwani Associates, believes TRAI’s digital radio policy is an important step toward modernising India’s broadcast sector. However, he cautions that the recommendations fall short on addressing the financial realities of private FM broadcasters.
“The TRAI recommendations represent a forward-looking attempt to bring Indian radio in line with global broadcasting standards,” he says. “At present, the FM sector has been technologically stagnant, while television and OTT have raced ahead. But without a concrete financial roadmap, broadcasters may see this as an added burden rather than a growth opportunity.”
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Jotwani notes that private radio players already operate under high licence fees and shrinking ad revenues. To ensure equitable participation, he suggests a series of fiscal and infrastructural support measures:
- Tax incentives or subsidies for digital transmission equipment.
- Reduced licence fees during the transition phase.
- Shared infrastructure models to help smaller broadcasters lower costs.
- Consumer incentives such as government-backed subsidies or awareness drives for digital receiver adoption.
Without these, he warns, the transition may be dominated by large networks, leaving smaller regional broadcasters unable to compete.
A regulatory vision without a financial backbone
TRAI’s vision includes several progressive elements:
- Adopting a single digital radio technology standard in the VHF Band II.
- Allowing private broadcasters to simulcast digital and analog channels.
- Enabling Radio Broadcasting Infrastructure Providers to lease digital infrastructure to operators.
- Encouraging Prasar Bharati to share its land, towers, and transmission infrastructure with private players at concessional rates.
These steps could, in principle, improve efficiency and open up the airwaves to more diverse programming. But as broadcasters point out, efficiency gains mean little if the economics don’t add up.
Digital music streaming, already eating into FM’s advertising revenue, poses a formidable challenge. With advertisers shifting toward online platforms that offer data-driven targeting, traditional radio’s linear model looks increasingly vulnerable.
Industry observers argue that India’s transition to digital radio must be gradual, inclusive, and financially supported. A five- to seven-year grace period, they say, will allow broadcasters to recover costs, train personnel, and assess audience acceptance before fully committing to digital.
Global precedents offer useful lessons. Countries like the UK and Norway combined regulatory support with public awareness campaigns, consumer subsidies, and phased rollouts. This ensured that when digital transmission began, there was a base of receivers and a willing audience ready to tune in.
“The FM sector is already facing existential challenges from streaming platforms,” says Hukmani. “If digital radio is to thrive, not just survive, TRAI and the government must make the transition financially and technologically viable for all players—not just the top few.”
If India attempts a sudden shift without parallel investments in ecosystem readiness- such as low-cost receivers, auto integration, and mobile compatibility- the migration could fail before it starts, warn experts.
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