BBC WORLDWIDE, the broadcaster’s commercial arm, acquired FM radio licences covering seven of India’s biggest cities yesterday in the unit’s first move into overseas markets.

BBC and its local partner, Mid-Day Multimedia, won licences to operate FM radio services in Bombay, Delhi, Bangalore, Madras, Calcutta, Ahmedabad and Pune.

The successful bids came just days after the BBC announced that it had bought a 20 per cent stake in Radio Mid-Day West, a subsidiary of Mid-Day Multimedia, the Bombay-listed media group.

India’s Ministry of Information and Broadcasting began the auction of licences covering the country’s 13 largest cities yesterday. As many as 84 companies have been cleared to participate in bidding for a total of 338 new radio licences in 91 cities.

The BBC had hoped to scoop nine licences in the first round of bidding. However, Monisha Shah, BBC Worldwide’s director of emerging territories, said that she was delighted with the results: “Given the significant size and audience reach of these licences, our radio venture has now created the substantial national presence we were aiming for.”

Ms Shah added that the venture would refine its bidding strategy before the next round in the auction. The auction ends next month.

Tariq Ansari, managing director of Mid-Day Multimedia, said that Radio Mid-Day West aimed to use the content, expertise and technology of BBC Worldwide to emerge as one of the leading private radio stations in the second-most populous country after China. FM radio is a fledgeling industry in India and has enormous growth potential. According to analysts, advertisers spent about $40 million with commercial broadcasters in India in 2003 — less than 2 per cent of total advertisement spend.

However, radio revenues are expected to more than triple to $150 million by 2008. The Indian radio network covers 97 per cent of the country’s population of more than a billion through 24 languages and 146 dialects.

Besides BBC Worldwide, a host of leading Indian media houses and international companies, including Britain’s Virgin Radio and the Malaysian pay-TV company Astro All Asia, are vying for licences as part of the Government’s newly unveiled liberalised investment guidelines.

Virgin Radio has tied up with HT Music, part of the HT Media group that publishes the Hindustan Times, India’s second-biggest selling daily, to enter the market.

The British company has not disclosed financial details of the partnership.

However, in a statement yesterday Virgin Radio said that Virgin Radio Asia, a subsidiary, confirmed that it would provide radio expertise, knowhow and advice to Hindustan Times Group, which has successfully bid for FM radio licences in Bombay, Delhi, Bangalore and Calcutta.

The company has entered into similar radio ventures in Thailand and with Oui FM in Paris.

Under the Indian Government’s liberalised norms for ownership rules in the media industry, foreign investors can hold a maximum 20 per cent stake in an FM radio station.

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