10+2 Ad Cap: With another hearing date, b’casters mull over the way forward

The 10+2 ad cap issue continues to haunt broadcasters. With the Delhi High Court postponing the next date for hearing in the case to July 15, 2014, a solution eludes the contentious issue once again.

While GECs have already implemented the TRAI mandated ad cap, news broadcasters have got respite from implementing the ad restriction. Broadcasters have been highlighting how they have been bleeding in terms of revenues unless subscription revenues come into place.

As is known, the ad cap case has been continuing since August last year and with the new hearing date in the case, no early seems to be in the offing.

The question regarding the way ahead for the broadcasting industry has been on everyone’s minds. Will this matter remain sub judice for a long time to come? Will news broadcasters continue to stay away from implementing the mandate ad cap? Where does this leave the GECs, who have adopted the ad cap since the initial days of the TRAI diktat?

All these questions will remain unanswered till some concrete steps and a firm decision as to whether or not the ad cap is mandatory are taken by the High Court.

Speaking on the way ahead, some CEOs of leading news channels on condition of anonymity, stressed that it would be unfair to expect news channels to implement such an ad cap since they are already paying a huge amount of money as carriage fees, and advertising revenue is the only source of income for the channels.

One of the leading broadcasters remarked, “The idea behind bringing the ad cap basically is to try and create a favourable environment for the government.  TRAI is an independent body and works on its own terms.”

When asked what if a new government comes in power post May 16 and dissolves the policy, he said, “There are very less chances of such an initiative as it is a Parliamentary issue and needs to be raised in Parliament. Secondly, every government wants to control the broadcasters.”

As is known, this ad cap is an Act of Parliament, which was mentioned in the Cable TV Networks rules of 1994.

Some broadcasters have questioned the limiting of ads and have called for a revision as they say that when the ad cap was introduced there was less advertisement on TV compared to today.

The CEO of another leading channel said, “It is ultimately a game of digitisation. Once the digitisation process is completed and subscription revenues kick in, it will be easier to implement the ad cap. However, if the economic climate is not conducive, it will be impossible to implement it.”

Innovative advertisement is the way ahead
The news broadcasting industry has seen a lot of innovation in advertising in the last couple of years – these include ticker ads, sponsorships during weather reports, and PCR sponsorship, among others.

Different tie-ups and associations during single large events or prime time have taken the front seat.

It may be recalled that previously broadcasters had found their own equation for ad breaks in a clock hour of programming and had come up with 18+3. However, this fell through as it was never implemented.