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TRAI’s ad regulation will make it difficult to recover costs: Joy Chakraborthy

16-May-2012
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TRAI’s ad regulation will make it difficult to recover costs: Joy Chakraborthy

TRAI’s (Telecom Regulatory Authority of India) decision to release regulation on television advertising has come at a very inopportune time. We have all been looking forward to and gearing towards digitisation. In the current scenario, over 90 per cent of the revenue for broadcasters, especially news channels, come from advertising, as most of these channels are not pay. Digitisation would help in changing the balance and bringing subscription revenues to the mix. But even before we could take that forward, TRAI has put a cap on ad time in an hour for television.

This is a very upsetting development for news and niche channels. It would impact our business drastically. There still are many clauses that need to be clarified. For instance, on a news channel, when you cannot play ads at the time of airing breaking news or any important development during elections and budget and so on, how will the ‘clock hour’ clause work. News is akin to live telecast – it is not favourable for viewers if we break the telecast of an important speech and play an ad. And if we cannot carry forward that commercial time, then what do we do?

And TRAI is also not allowing to monetise content time by directing to stop drop down or part screen advertising. Given the manner in which costs have been increasing and there is pressure from the environment, how does one survive?

TRAI had brought some clarity on the carriage fee issue on May 14 when it said that there would be no placement fee and all channels of a particular genre would be placed together in an EPG (Electronic Programme Guide) format. This is very good news for the industry. While it would have its challenges too, it still opens new windows of opportunity for broadcasters. Once digitisation would be in place, one would have appreciated the cap on advertising time but making it effective immediately will create huge problems for the industry. The regulation in its current format will make it difficult to even recover costs. It has come way ahead of time.

As told to Noor Fathima Warsia

Joy Chakraborthy is the Chief Executive Officer of TV Today that runs channels such as Aaj Tak, Headlines Today, Dilli Aaj Tak and Tez, and Radio Today

Follow Joy Chakraborthy @JoyChakraborthy

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