New OOH guidelines for govt ads evoke mixed reactions from industry
The guidelines will come into effect from the date of notification by BOC (Bureau of Outreach and Communication) and will supersede all earlier internal guidelines of BOC
Last week, The MIB (Ministry of Information and Broadcasting) has framed Policy Guidelines for Rate Fixation and Advertisement Release in Outdoor Media and Personal Media for Government Advertisements.
The new framework by MIB comes at the onset of the election season in the nation and at a time when OOH will see a further amplification. As the outdoor media publicity space is evolving and spreading in addition to traditional outdoor media (like wall painting, hoardings, etc.), new technologies and new space for outdoor publicity have come up. Therefore, it has become the need of the hour for the Ministry to determine modalities for engaging with such media platforms for assured reach. Further, the guidelines would act as the common point of reference for stakeholders in Outdoor Publicity media for the execution of Outdoor Publicity projects of the Government of India.
The objectives highlighted in the guidelines by MIB are as follows:
1. To enable the Government for better outreach and mass communication by producing effective and people-centric creative content, at optimal rates, in a competitive, transparent, and time-bound manner.
2. To provide the stakeholders a clear understanding of parameters and process of selection, job award, rate fixation, and other related aspects for transparent and efficient execution of Outdoor Publicity.
The eligibility criteria for agencies applying for rates under Category A and Category C of Outdoor and Personal media will be required to meet the following criteria:
1. The agency should either possess the advertising rights for the desired media from the authorities as defined for Category A or, should be eligible, in the opinion of BOC, under Category C. BOC will determine the documents/ proofs be submitted by agencies in support of their claims.
2. The agency should apply for the media, which has been installed and is operational. BOC will NOT consider the media which is in the stage of conception/ construction.
3. The agency should not be temporarily suspended by BOC at the time of rate application and must not have been permanently de-impaneled or blacklisted by BOC. Any agency seeking BOC rates should not be involved in a criminal act for which the proprietor or Director or promoter of the agency has been convicted by a court of law. Any agency seeking BOC rates for their media should comply with all laws of the land.
4. In respect of Category C media, BOC will ensure that only such media is considered which qualifies as a proprietary item under Rule 166 of GFR. The viability of any media which is eligible under this category will be reviewed by BOC after six (6) months to take a view as to whether media should continue on the BOC panel or not.
In terms of Rate Fixation, in one of the clauses they have put forth that in case the License Fee is the only major criteria based on which the rights for media have been obtained by the agency/firm (i.e., the agency is not required to construct the media or the associated structure), the BOC rate would be twice the License Fee, at the maximum.
A prominent OOH Owner who didn’t want to come on record sharing his perspective over this clause of the policy guidelines stated, “They have shared that they will give double the license fee where there is no other expense to be incurred except the license fee. If the billboard and the structure are provided by the municipal corporation, then we will only have to pay the rent. They will pay double the license which is a good prospect.”
Another clause mentioned was that BOC will approve the rate in the range of 60-75% of the average commercial rate depending on factors such as city and State/ UT where media is located, visibility of media, the extent to which other media is available with BOC for same city/ location, BOC rate for other media in the vicinity, etc., provided the commercial work orders are credible.
For this, an OOH owner sharing his concerns remarked, “This clause won’t work. 60% of our commercial rate does not equal twice the amount of profit. This clause is a serious issue. I would presume that if the range is 60-75% then our license fee will be only 30% for board, structure, and license. It doesn’t seem profitable in the current market environment. There is also a lack of clarity on who will establish the commercial trade and how it will be established. There should be a set benchmark for it.”
Also, in one of the clauses, they have shared that only the companies that have the ownership of the media can advertise on the structure. OOH companies say that as the market gets sophisticated ownership patterns are often joined and marketing rights are taken over by someone else. Within the same OOH company, the one who owns the media might not be the entity that is responsible for OOH marketing. There are consolidated and conglomerate agencies and ownerships that tend to advertise on the media site that is purchased.
OOH owners also pointed out that they are silent about when they are going to give the PO (Purchase Order) and when they are going to give the payment to the OOH Advertisers. There have already been delayed responses to payments in the past and OOH players are concerned about what happens to the GST release.
Another OOH owner from Mumbai sharing his perspective said, “In general clarity always helps, the rules by MIB seem to provide a clear direction. The concern is whether implantation will follow the spirit of the order when it comes to government advertisements on billboards.”
The guidelines will come into effect from the date of notification by BOC (Bureau of Outreach and Communication) and will supersede all earlier internal guidelines of BOC. These guidelines will apply to all the existing media/locations already on BOC panels as well as the ones which are taken on the BOC panel in the future.
Read the entire policy guidelines here:
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