BARC India's former CEO, COO arrested; will the TV measurement body manage to withstand the storm?

In April 2015, the Indian television industry underwent a 'ratings dark' period. On April 29, 2015, Broadcast Audience Research Council (BARC) India rolled out the ratings for week 16 and the industry's measurement system saw a ray of light once again.

It was the end of Nielsen and Kantar's TAM, and the birth of BARC India, to be run by the Indian Broadcasting Foundation (IBF), Advertising Agencies Association of India (AAAI) and Indian Society of Advertisers (ISA) as its stakeholders.

Now, half a decade on, a dark cloud of uncertainty is looming large over the measurement system. Partho Dasgupta, former CEO of BARC India, has been arrested. Former COO Romil Ramgarhia is also behind bars, and so is Vikas Khanchandani, CEO of Republic TV.

The three are among 15 people who have been arrested so far. The Mumbai Police is investigating what it calls 'The TRP Scam' in India. According to Milind Bharambe, Mumbai joint commissioner of police (crime), Dasgupta was "driving the manipulation of data", which continued from 2016 to 2019.

Bharambe said that BARC India had commissioned a third-party auditor to check the integrity of the data. The auditor audited data for a period of 44 weeks, starting 'mid-2017'. The report, according to Bharambe, found that "Times Now was thrown in number two position, despite securing top ratings. At the same time, Republic TV was made number one, all by manipulating data."

Bharambe also stated that the report was submitted in July 2020. "BARC India's current dispensation has been very cooperative. It has supported us by facilitating all sorts of data." 

He went on to say that Dasgupta was the "mastermind" of this data manipulation. According to the auditor's report, three methodologies were used to manipulate data so that it favours selected beneficiaries.

"Outlier method, changes in the meta rule method and channel audience control were the three methods used by BARC India to manipulate data attained through 44,000 bar-o-metres installed in households," said Bharambe. He explained the outlier method and how meta rule was changed so that it benefits certain channels. 

Explaining things further, Bharambe said that if in a house, one channel is tuned in for 12 hours, the meta rule is such that it must choose that data to be 'outlier' and, therefore, not consider it.

"However, meta rules were changed at a head office level, which benefited one English news channel," stated Bharambe, without naming the channel. When asked why Dasgupta was doing so, Bharambe replied, "We are still investigating the matter and will connect the dots soon."

He also said that the discrepancies recorded by the auditor started in 2016 and continued till 2019. Why did the auditor select 44 weeks, starting mid-2017, then? Bharambe did not give a clear answer and said the data is so huge that analysing it bit by bit takes time…

However, it is worth mentioning here that Republic TV was launched in May 2017, and the 44 weeks analysed in detail by the auditor borders around the launch of this one particular channel. 

Bharambe said that the discrepancies were more visible among news and Telugu channels. "We have evidence of some manipulation in the general entertainment genre and are investigating the same."

Now if the report was submitted by the auditor in July 2020, why didn't the stakeholders - IBF, AAAI and ISA - take immediate action against the management? In fact, industry bodies like The Advertising Club went on to re-elect Partho Dasgupta as the president. Why would the industry re-elect the alleged "mastermind" of a TRP scam in September 2020, after the auditor's report was submitted in July? When asked what actions were taken against Dasgupta and his colleagues in the head office, Bharambe replied, "Many of them had resigned is what we got to know."

It is true that Ramgarhia, Dasgupta and many other senior officials in BARC India's management resigned earlier this year. However, there was no mention of any discrepancies. If the manipulation in TV measurement is going on since 2016, that means tens of thousands of crores were spent based on manipulated data. Rs 18,400 crore was spent in FY16, Rs 20,300 crore in FY17, Rs 22,400 crore in FY18, and Rs 25,100 crore of advertising money on television in FY19. 

Many critics of the Uddhav Thackeray government (in Maharashtra) alleged that this wrath on BARC India is to demean and cut the wings of Arnab Goswami's Republic TV. However, this is not the only storm that BARC India has to withstand.

With its credibility at an all-time low, BARC India has a set of recommendations from the Telecom Regulatory Authority of India (TRAI) at its table. In April 2020, TRAI issued a recommendation: 'Review of Television Audience Measurement and Rating System in India'.

"Several concerns relating to neutrality and reliability of the existing rating system have been raised by stakeholders, which necessitated a need to review (the) existing Television Audience Measurement and Rating System in India," stated a TRAI statement.  

TRAI recommended that structural reforms are required in the governance structure of BARC to "mitigate the potential risk of conflict of interest, improve credibility, bring transparency, and instill confidence of all stakeholders in the TRP measurement system."

BARC India's revenue stands at around Rs 300 crore, out of which about Rs 265 crore comes from the broadcasters. Of the remaining Rs 35 crore, AAAI contributes a part, and the lion’s share is earned through other sources, like reports, consultation, etc.

TRAI's recommendations has irked many broadcasters, who are set to lose their seats in the governing body despite paying for it. BARC India currently has 10 directors on its board. Six of them are broadcasters, two are media planners representing the agencies, and two advertisers.

TRAI has suggested a new composition as per which BARC India board should have at least 50 per cent independent members, including one member as a measurement technology expert, one statistician of national repute from top institution(s) of the country, and two representatives from the government/regulator.

It adds that the restructured board should provide for equal representation of the three constituent industry associations, namely, AAAI, ISA and IBF, with equal voting rights, irrespective of their proportion of equity holding.

This, therefore, means that the current six-two-two ratio can no longer sustain. Out of the 50 per cent independent members, TRAI has already pronounced four. So, the new board could include two broadcasters, two (individuals) from the agencies and two advertisers, making the 50 per cent, while six independent members constituting the remaining 50 per cent. This will unseat the broadcasters from the controlling chair in BARC's board.

So, with Mumbai Police basically validating what TRAI has alleged, will BARC India manage to withstand the storm?

Disclaimer: Please note that the date of this article should be 28-12-2020, but due to some technical error it is showing 29-12-2020.