Acquiring a Broadcast License
Most of the countries worldwide have a system of granting license for broadcasting, given the scarcity of broadcast frequencies as compared to the resources competing for these licenses.
Unlicensed broadcast (also known as pirate radio stations) is construed a criminal offense in many of the countries as it interferes the other vital signals like those used for flight monitoring. Pirate radio stations often broadcast contents that are against the government policies or contents for which no royalty is paid. Either ways this is illegal and offenders may be subject to penalty or imprisonment or both.
License is one of the biggest hindrance in entering into this lucrative business. A major portion of time and effort in setting up a radio station is spent in obtaining license. The time required to obtain a license may range anywhere from 1 months to 15 months in some cases.
The cost of acquiring license varies from country to country and there is a wide variation even within states. The licenses are mostly granted through the auction process and the license is granted to the highest bidder.
Given the general scarcity of frequency of transmission, the cost of obtaining the license is perhaps the most expensive part of setting up a radio station. For Instance, in the U.S.A the average bid range for a medium sized markets ranges around 1 million USD.
However, the good thing about licenses is that it is a major entrance barrier for new competition. So, if you have obtained a license you are protected from competition to a large extent as is applicable to other businesses. And obtaining a license is not that difficult if you take some time to understand the processes and comply to the rules clearly.
And if funds is an issue, there are several ways of starting on a moderate expense and then scaling it up over a longer period of time. We have drafted a sample blueprint to help beginners reduce the cost of setting up a radio station drastically.
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