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  • FEBRUARY 29, 2000

TV 18 takes stake in FM unit; to hive off Internet business

Television 18 (TV 18) is set to take a 50% stake in Vertex Broadcasting Corporation (Dabur owns the balance 50%), which has bid for 30 out of 40 FM radio stations in the country. The company has also decided to spin off its Internet business into a separate entity.

TV 18 does the programming for CNBC Asia and has recently increased the programming for over 12 hours. The company went public at a price of Rs 180 around in December 1999 and its issue was oversubscribed over 55 times. It recently got listed at a price of Rs 1800.

This will be the first broadcasting venture for TV 18. It had plans to get into television broadcasting as and when satellite uplinking is allowed from the country. But if the bid of Vertex Broadcasting for radio broadcasting succeeds this could turn out to be the vehicle for television broadcasting too. And the popularity of the FM could help establish TV 18 as a brand among the audience and help brand recall in the future.

This could also help the company to broad–base its viewership by broadcasting in Hindi and other regional languages.

The company had set apart Rs 30 million from its public issue to set up an Internet portal since the management as a part of its strategy had planned an interactive media model which includes the Net. Initially, the Internet venture will open a new revenue stream at a little extra cost since TV 18 already produces the television content.

However, the marketing costs of the internet venture would have pulled down the company’s finances. Hence the setting up of the Internet venture through a separate company.

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