IAMAI’s new digital order runs into speed breaker

It’s been barely a month since IAMAI (Internet and Mobile Association of India) announced an accreditation and credit policy for the online industry, and it has already run into trouble.

For one, AAAI (Advertising Agencies Association of India) wants special privileges for its members, and has gone to the extent of barring its members from signing up for accreditation. That’s serious stuff, considering AAAI represents 80 per cent of advertising revenues in India.

Talks are on between the two associations, one of them a behemoth of traditional advertising and the other, the harbinger of emerging media. The talks are expected to conclude in two weeks’ time.

Former AAAI president and chairman of the Madison Group, Sam Balsara, has been actively involved. He has already been in one round of talks with IAMAI members. He told agencyfaqs!, “We hope to reach an association-to-association agreement with IAMAI so that our members may get preferential treatment, especially in terms of the credit policy.”

Another bone of contention is that the policy is seen by digital agencies to be too publisher friendly. IAMAI’s policy deals with the relationship between agencies and publishers, as well as agencies and their clients. It leaves out direct deals between publishers and clients.

The fact is that online publishers such as Indiatimes, Yahoo!, Rediff and Sify have played a key role in formulating the policy. Digital agencies came into the picture only in the second stage, when most of the clauses had been decided. Naturally, the agencies feel that many issues have been left unaddressed.

Ratish Nair, CEO of Interactive Avenues, warns, “If the agency is unable to pay because it has not received its dues from the client, the policy gives the publisher an option of dealing directly with the client, which has serious implications for the agency’s business.”

Quasar is another interactive agency that has voiced its fears. Manish Vij, co-founder and business head of Quasar Media, says, “Agencies should be given at least three months’ credit period.” Vij suggests that if an agency defaults with one client, all its accounts should not be closed. Interactive Avenues and Quasar are two of the eight digital agencies that are members of IAMAI.

Online publishers have a different point of view. According to Upen Rai, director, sales, Indiatimes, “We do not want to eliminate the agencies, but, after all, they are the mediating party between the publishers and the clients. Publishers should have the freedom to choose who they want to do business with.” He adds that it’s in the interest of the agencies to cooperate.

Another issue is the clause that states all billing amounts will be based on the publishers’ server report. Obviously, for agencies employing third-party servers, this is a problem as there are no guidelines.

IAMAI obviously does not want to be seen aligning itself with any group. Asked about the agency-related concerns, Dr Ray said, “These issues will be dealt with as we go along.”

Not everybody thinks that the world is changing, though. V Ramani, a founding member of IAMAI and president of Connecturf, says, “I don’t think we need to whip up a controversy. Whatever issues are being brought up are part of the evolution of any policy,” he said.

Perhaps. But it also shows how high the stakes are for the fledgling industry.

© 2007 agencyfaqs!