labels: entertainment, marketing - general, marketing media
Advertisers strike back; broadcasters reduce commercials breaks on TVnews
16 October 2007
New Delhi: Through the Indian Broadcasting Foundation (IBF) had tried to broker a truce yesterday with its Plan B offering of a one-month surcharge-waiver that it had announced on Sunday, the Plan B seems to have had a minimal impact on the advertiser - broadcaster - media buyer war.

Starting Tuesday, programmes across most TV channels will see ad-breaks decline to around 10-20 per cent.

Heavyweight advertisers such as Hindustan Unilever Limited (HUL) and Procter & Gamble (P&G) have reportedly refused to accept the IBF''s implementation of a 25 per cent surcharge on advertisements.

Now, TV executives across various channels are slogging to extend the programme duration to fill airtime that would have otherwise to led to the broadcasters'' cash tills ringing to the tune of "commercial breaks".

As a stop-gap, broadcasters are airing promos, public service advertising, along with own brand inventories would occupy the regular ad slots, as will government ads ie those issues by the Directorate of Advertising and Visual Publicity (DAVP), and media ads.

According to Paritosh Joshi, president for ad sales and distribution at Star India, this situation is unlikely to continue for a very long time, as clients would soon realise the gravity of the situation. "Can you imagine TV without ads?", he responds.

Yes, sir. TV viewers would love the thought, as over the next few days they''d get unadulterated programming, without innumerable advertising breaks. What the advertisers and broadcasters should think about, is what would happen if viewers like the concept of watching programming sans advertising.

According to industry estimated, the ad-free television viewing experience will last a week at the most.

According to IBF sources, there were only a modest number of advertisers who signed up for its'' plan B of the one-month surcharge-free ad rates.

The row between the broadcasters and the advertisers started when IBF cited a hike in input cost as justification to levy a 25 per cent surcharge on all advertising rates being offered by the broadcasters, effective 16 October. Homes with cable and satellite (C&S) TV have increased from 42 million to 70 million during the past three years. In the same time, increased competition in the channel space has seen ad rates sink by 20-30 per cent.

According to reports, most mass entertainment channels have accepted IBF''s advisory to hike the ad rates through the 25 per cent surcharge. Some news, and niche and regional channels have preferred to complete existing deals with advertising clients at per existing contracts, prior to shifting to the hiked rates.
also see : What's the spat over TV ad surcharge?

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Advertisers strike back; broadcasters reduce commercials breaks on TV