There seems to be complete confusion in the broadcasting industry on the implementation of the 10+2-minute cap on advertisements that kicks in tomorrow (October 1).
According to a directive from the Telecom Regulatory Authority of India (TRAI), broadcasters are supposed to start restricting commercials to 10 minutes and in-house promotions to two minutes every clock hour from October 1. But several broadcasters are not clear whether the cap needs to be implemented from Tuesday itself.
The confusion stems from the Telecom Disputes Settlement and Appellate Tribunal’s (TDSAT) statement in August that no coercive action will be taken against news broadcasters. The News Broadcasters Association saw this as a reprieve, as the tribunal had also said that they will not be required to submit weekly reports to TRAI till the next hearing on November 11.
As a result, while some bigger general entertainment channels are set to move to the 12-minute ad cap rule from Tuesday, others, especially some news and music channels, said they will not implement the directive now.
However, a senior broadcasting sector executive said irrespective of the tribunal’s order, channels will have to start complying with the rule. Ashish Bhasin, Chairman, India and CEO, South East Asia at Aegis Group, said: “There is a considerable amount of ambiguity in the industry. While one set of broadcasters, especially news channels, believes they have got a reprieve from TDSAT, others believe they will have to go ahead and implement the directive. I hope there is more clarity in the next one week.”
Star India, for instance, is set to implement the ad cap directive from Tuesday, said its Chief Operating Officer, Sanjay Gupta. But all general entertainment channels are not on the same page, another channel official said, adding that his group will not follow the directive till the tribunal’s next hearing.
The confusion comes at a time when the festive season is set to kick off this month and advertisers are gearing up to roll out campaigns.
Any hike in rates for television advertising at this time could prove to be a dampener. Some big broadcasters have already indicated that they will be increasing ad rates to make up for lost revenues due to the cap.
But, any hike in rates will not go down well with advertisers. Anisha Motwani, Director & Chief Marketing Officer, Max Life Insurance, said: “Instead of passing on the increase in ad rates to make up for revenues, broadcasters should look at internal cost efficiencies.”