TV strike: Grace period over, advertisers seek rebate

By Sapna Nair , afaqs!, Mumbai | In Media Publishing | November 24, 2008
The grace period of 10 days was over on November 20

November & #BANNER1 & # 20 could have well been a day of relief for television broadcasters, but it got them into more trouble. The 'now there now not there' strike of the Federation of Western India Cine Employees (FWICE) not just left the broadcasters disillusioned about when fresh content would be revived, it also left them answerable to the advertisers who had supported them till then.

While the strike was going on, the Advertising Agencies Association of India (AAAI) and the Indian Society of Advertisers (ISA) had urged media agencies and advertisers to support the broadcasters for a period of eight-10 days. The 10 days ended on November 20, the day FWICE called off the strike, only to go back on strike once again. This means that advertisers are now entitled to ask for rebates, discounts or some other way of compensation as long as the strike lasts.

Joy Chakraborty, chief revenue officer, Zee Entertainment Enterprises Ltd (ZEEL), confirms that Zee has begun talks with all its advertisers. "We have spoken to advertisers and media agencies. The advisory issued by the AAAI and ISA stated that after the 10 day period, we must engage in bilateral discussions with them and find a way out. We are in the process of negotiation," he says.

Some of Zee's clients have asked for discounted rates, while others have asked for cancellations until the channel gets back with fresh content. "We have offered discounts and value additions to some of our clients. Most have stayed with us because general entertainment as a genre cannot be ignored. Despite the repeats, we still command the highest GRPs (gross rating points)," says Chakraborty.

However, Sudha Natrajan, chief operating officer and joint president, Lintas Media Group, believes that the GRPs of general entertainment channels (GECs) have been falling. "We have been monitoring aMap data extensively and even the latest TAM data reveals that the share of GECs has fallen," she says. Lintas Media Group will soon begin negotiations with the GECs, but Natrajan says that none of their advertisers have cancelled deals.

Punitha Arumugam, group chief executive officer, Madison Media, says that talks have started with all GECs. "The solution that some advertisers may want to employ is moving their monies to other genres or to work out packages while continuing to be active on the GECs," she explains.

Rohit Gupta, president, network sales, Sony Entertainment Television, says that it's too early to arrive at a conclusion. "Whether we will offer rebates or not depends on the nature of the deals. I wouldn't want to comment on this right now," he says.