WorldSpace India's expansion plans hit regulatory hurdle

Satellite radio service provider WorldSpace India’s plan to expand its business locally and open additional revenue stream in the country — through setting up a studio for creating digital content and a call centre — seems to have hit regulatory hurdles.

WorldSpace India’s proposal to the Foreign Investment Promotion Board (FIPB) has been deferred till the Department of Information Technology (DIT) submits its views. Both the Ministry of Information and Broadcasting (I&B) and the Department of Telecommunication (DoT) have informed FIPB that the matter is beyond their working area.

It should be noted that the licensing and regulation of satellite radio comes under the purview of the I&B ministry, while the allocation of spectrum for radio services is the responsibility of DoT.

Hurdles to the proposal from WorldSpace India also gained importance because its parent company, WorldSpace Inc, has filed for bankruptcy protection in the United States and are looking at its India operations to expand business.

WorldSpace India has sought the FIPB nod for setting up a wholly owned subsidiary that will include setting up of a studio for carrying outsourcing, commissioning and production of digital audio and multimedia software programmes for both domestic and international market. When contacted, a senior executive of WorldSpace India refused to comment.

According to the proposal, WorldSpace India wants to open a call centre.

It is also looking to import digital satellite receivers, data adaptors, PC add-on cards and accessories and sell the same to the distributors and dealors either as customs bonded warehouse sale or on a cash and carry basis. However, WorldSpace India does not seek any fresh inflow of foreign investments for its proposals.

While I&B said that the web-based services are not regulated by them so they can not comment, the DoT has informed the FIPB that WorldSpace India’s proposal and the scope of work mentioned in their applications does not fall in the ISP category therefore comments should be sought from DIT.