NDTV has decided to increase its ad rates after a gap of 18 months. The new rates are effective from the beginning of the new fiscal year and have been across channels, though each channel sees a different percentage increase – NDTV 24x7 and NDTV Profit witnessing a higher jump vis-à-vis NDTV India.
In the present state-of-affairs, NDTV channels are on the higher side when it comes to ad rates in any case – NDTV English channels being the highest among the English news channels. Speaking on the reasons why the Network had decided to increase the ad rates, Raj Nayak, CEO, NDTV Media said, “We have not increased our rates for last 18 months and much has transpired since then.”
He further elaborated, “The GDP has grown by 8 per cent, interest rates have gone up, home loan rates have gone up, salaries have gone up – inflation is an omnipresent factor in everything. More importantly, the C&S penetration has gone up – where it was approximately 43 million, it now is at 61 million households. It is only logical that rates go up too.”
What happens to advertisers who have already signed deals? To this Nayak replied, “All deals that are signed before April 1, 2006 will get the benefit of the current rates.”
Throwing more light on the kind of increase that would be seen in the ad rates, he said, “We are looking at a minimum of 20 per cent increase across the board. While C&S penetration has jumped 42 per cent in the same period, this is hardly a jump I would say, but given competitive pressures, a 20 per cent jump seems just about right.”
He explained that NDTV 24x7 and NDTV Profit would see a higher percentage increase than NDTV India. On a broader note Nayak said, “I guess they are applicable across the industry. Every sector, everyone gets into a rate revision, so I see no reason why it should be an issue when a TV channel increases it rates.”
How does he see the market responding to these ad rates changes? “The industry realises that costs are bound to go up and they appreciate that despite tremendous demands on our costs we did not increase our rates in the last 18 months. As long as we deliver value to our customers, we do not see a slight rate revision to be an issue,” Nayak maintained.
Perhaps the increase in ad rates makes sense for NDTV at present, too, given the fact that it is the ad sales custodian for MSN.