It appears that struggling satellite radio firm Worldspace Inc is eying the web based music streaming in India: the companys application to launch its online radio services in India has been deferred by the India’s Foreign Investment Promotion Board (FIPB). Worldspace has an On Demand radio portal, and perhaps plans to launch something similar to this widget.

But Why Online?

There are not many legal online radio providers in India and there may be good reasons why. Worldspace had tied up with Microsoft India in 2007 to launch an online radio service, but MSN Radio has since shut down. Worldspace had charged $9.99 for the service back then. If it plans to adopt the same model now, we doubt if surfers would be interested. Would you? There is one other music station which appears to have a similar pricing – , though there are several free online radio stations like , Radio Paradise and Radioverve.

The delay must come as a letdown to the bankrupt company which needs the opportunity to get back on its feet after its premium satellite radio service found few takers. It suffered a loss of approximately $2.5 billion in 2007 and is just hauling itself out of Chapter 11 bankruptcy protection. Read more about what went wrong here.

The Mobile Issue

This is not the only regulatory barrier that Worldspace has faced in the country. It is yet to convince regulators for launching its Hybrid radio service for automobiles. It is also awaiting a decision by TRAI on whether radio broadcasts on DTH should be brought under the interconnection regulations that cover TV channels. Worldspace currently offers radio on Airtel’s DTH service Digital TV.

Online Radio versus Music Downloads & FM On Mobiles

We agree that there is a definite difference in experiences when you listen to the radio and when you put on a playlist. The element of surprise, of hearing a song that you havent heard for long and have forgotten, etc. But the experience online may not be the same – for one, connectivity in India is still poor. Unless the service ensures that the music streaming is light enough to play through our pipes without jitter, it will not feel like radio but this may require sacrificing quality.

And it will not be a volume game – there are just 6 million Internet connections. Compare this with the 400 million mobiles and the choice of Shuffle clones with FM integrated available in the gray market. Against a vastly more popular medium like mobiles (some have FM integrated in them), how will Worldspace’s online radio fare?

Competing strongly with such a service are portals like the one by BSNL and Hungama, from where surfers can download music and videos using prepaid vouchers.

The company broadcasts to 130 countries and has 68 channels. In India, it has a centre in Bangalore and broadcasts some 34 channels. Its competitors are primarily FM radio channels such as Big FM by Reliance Entertainment and Radio Mirchi, which are free to air and advertising supported. There are over 200 such radio channels operational in India, so pricey satellite radio has not been successful.

Worldspace has been granted three years by the Information and Broadcasting ministry to shift to the new licensing regime that would require it to divest 26 per cent equity in favour of Indian equity investors, Television Point reports.

Its founder Noah Samara is also in the limelight for being the key witness in an undergoing trial for a suspected bribery case in USA.


WorldSpace Bankrupt And On The Block: What Happened & What They Were Waiting For