Ad rates hiked at Sun TV and sister Tamil channels

By Sangeeta Tanwar , afaqs!, New Delhi | In Media Publishing | December 01, 2009
In the coming months, Sun Network will announce hikes in ad rates for its other general entertainment channels, including Gemini, Udaya and Surya

The leading broadcaster in the south, the Sun TV Network has announced hikes in advertisement rates for its flagship Tamil channel, Sun TV. The increased ad rates will come into force from January next year.

Speaking to afaqs!, Ajay Vidyasagar, chief operating officer, Sun Network, says, "The last hike in ad rates was in February 2008. Our shows have, over the years, delivered and performed well. Thus, the increase in ad rates was overdue."

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The hike in ad rates ranges from 3 percent to 33 per cent. Besides Sun TV, the revised rates are also applicable for Sun Network's other Tamil channels - KTV, Sun Music, Sun News, Chutti and Adhitya.

Vidyasagar shares, "The ad rate hike is an annual exercise at our end. Each channel has its separate business and we have started by revising ad rates for our Tamil channels. We will soon follow with hikes for our properties in other languages as well."

Besides Tamil, Sun Network also has channels in Telugu, Kannada and Malayalam. In some time, it will announce new rates for its other general entertainment channels, namely Gemini, Udaya and Surya.

Besides revision of ad rates for advertisers, there has also been a hike in the slot fees (broadcast fees) paid by content producers to the broadcaster. Without revealing the ad rates for a 10-second slot on Sun TV and other Tamil channels, Vidyasagar informs that the organisation will make public its revised rate-cards for advertisers in a few days.

Reacting to Sun Network's move to increase advertising rates, media observers share that coming from a distant leader and dominant player in the south, the announcement is purely a function of demand and supply.

"Sun is a strong network with presence across genres in multiple languages. It's the number one player and leads by large margin over others in Tamil Nadu. It makes more sense to first test waters in its stronghold by increasing ad rates for Tamil language channels. Since it faces formidable competition in other languages, the idea is to experiment in Tamil and then make a similar move for its other channels," says Amit Ray, president, Lintas Media Group.

In fact, Sun Network is the only broadcaster which raises ad rates twice a year. However, owing to the economic slowdown, this year, this is the first of its two customary revisions.

Naresh Kumar Alambara, general manager and office head, Starcom Worldwide, Chennai, informs, "Sun TV's planned hike across programmes comes after a hiatus of more than two years; although at different times, it has marginally increased the rates of some of the key performing slots. Given that there have been no major spikes in its programme rating in the recent past, justifying rate increases of this nature across segments seems a bit difficult."

In the same breath, Alambara points out that Sun TV's shares and rating across weekday primetime has not dipped; and even with the proposed higher rates, the CPRP value it offers is among the best across most GECs (national or regional).

He adds, "The southern TV market has got extremely competitive in recent times. While Sun Network still maintains its leadership across markets; it is not dominating as it used to be, especially in Andhra Pradesh, Kerala and Karnataka. Newer players, such as Zee Telugu and Maa TV, and rejuvenated older competition, such as Asianet and Vijay TV, are giving a tough fight to Sun Network on eyeballs and ad revenue."

Sun Network has a palette of programming representative of commissioned and non-commissioned shows, 10-second ad-slots and sponsored shows as well. As per industry estimates, the average rate on Sun TV for the primetime slot is around Rs 27,000; peaking at Rs 28,750 for a few of its top performing serials. .

Commenting on the increase in broadcast fees for producers, Ray suggests that the increase in fee for producers would probably be in the same range as the increase in ad rates for advertisers. The broadcast fee increase could be 5 to 6 per cent different from the ad rate increase, which ranges from 9 per cent to 33 per cent.

Divya Radhakrishnan, president, TME says that things are looking up for the TV industry as a whole. According to her, the total FCT (free commercial time) on TV has seen an increase of as much as 30 per cent across genres. At the same time, she does not see any strategy in Sun's move to hike ad rates only for its Tamil channels; as in due course, it will roll out similar hikes for its other channels as well. "Sun Network is not market savvy and still operates more like Doordarshan," says Radhakrishnan.

Media planners and buyers believe that counter-programming with non-fiction and a slew of reality-talent shows have given audiences a much broader viewing choice (compared to soaps and serials) than ever before. The challenge now would be for each of the key players to settle into an optimum mix of the programming choices, and thereby justify the price that they command.

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