Less cluttered TV shows as TRAI cracks whip

TV watching will soon become far less cluttered thanks to the Telecom Regulatory Authority of India's (TRAI) diktat setting a 12-minute-per-hour limit on advertising in TV shows. If you watch news channels, especially Hindi and regional news channels, you will find you are currently being exposed to close to 30 to 35 minutes of advertising every hour at certain times of the day. Even the ad breaks between the popular soaps on various entertainment channels are a good 8 to 10 minutes long. The tightening of the ad inventory could result in fall of ad revenue in the short term for the TV companies, but in the long term will lead to a lot more discipline, as well as rationalization in advertising rates.
 
The rule that a TV channel is allowed a maximum ad inventory of 288 minutes a day - or 12 minutes per hour for 24 hours - was laid down by the Cable Television (Regulations) Act of 1994. But broadcasters have played around with the stipulated inventory. They allotted most of the ad inventory to the prime time period (between 8 pm and 11 pm), while time-bands in the afternoon and late night when fewer people watch TV had relatively few ads. Advertisers had to pay a huge premium for their ads to be seen at prime time. The 12-minute ad limit will lead to less crowding of inventory during prime time and ad breaks will be equally divided across programmes all through the day.
 
 "This move will definitely bring in much needed rationalization in ad pricing, especially during prime time," says N.P. Sathyamurthy, President and Head, DDB Mudra Max.  Today, a 10-second ad spot on a popular general entertainment channel can cost anything between Rs 1 to Rs 2 lakh. Won't tightening of inventory result in higher premiums? Sathyamurthy says that if broadcasters hike their rates, they could run the risk of losing advertisers, who might prefer to explore newer platforms such as digital. "Some advertisers are already spending more than they should on TV," he says.
 
Though the TRAI had been planning to introduce this rule for some time, it faced opposition from the broadcasters, as most of them are entirely dependent on advertising for survival. However, with cable digitisation underway and subscription revenue soon to contribute significantly to their kitty, the loss for broadcasters may not be as much as they fear. In any case, they have little choice but to abide by the TRAI rule.