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The possibility of a ratings blackout seems imminent with the country's sole ratings agency TAM expressing its inability to undo its cross-holdings in a month.
The TV rating guidelines, notified by the government on January 16, prevent any single entity from having paid-up equity in excess of 10% simultaneously in both a rating agency and a broadcaster, advertiser or advertising agency.
TAM's 50% shareholder Kantar, which belongs to the WPP Group, has approached the Delhi High Court challenging the guidelines, which it says will render it out of business.
But with the Ministry of Information & Broadcasting keen on sticking to the deadline and also indicating that it will contest TAM's claims in court, a ratings blackout seems inevitable in the event the court verdict is not in Kantar's favour.
This will mean a prolonged blackout period stretching for about nine months since a new ratings system from the Broadcasters Audience Research Council (BARC) is expected only by October this year.
Advertisers such as Coca-Cola, Panasonic and Honda say they will turn to their media agencies for support during the blackout phase.
"Most media agencies do a lot of in-house research and have proprietary tools to help gauge how a show or property is doing," says Suresh Kumar Bandi, deputy divisional managing director, Panasonic India. "We will turn to them and rely on their expertise," he says.
Anita Sharma, assistant vice-president, ,marketing communications, Honda Cars India, says, "We will work closely with our agencies, in case there is no data available, we will have to look at what other sources are available."
Coke executives also said they would rely on the proprietary research of its media agency Lodestar to tide over the period. PepsiCo, the other big cola major, which is sponsoring the India Premier League (IPL), declined comment on the issue.
Executives at Hindustan Unilever, the country's largest advertiser, say that it would be difficult for them to do without ratings.
"We cannot be in a situation without data. We will have to find a way to extend the current system till the alternative comes into effect," a top official said.
Devendra Garg, senior executive director, consumer care business, Dabur India, says, “Absence of TV ratings for an indefinite period will be a difficult scenario. In the absence of such ratings, we will have to depend on our own brand track studies and informal research. That said, we expect that either TAM will be allowed to function in the interim or BARC is implemented faster.”
Advertisers such as McDonald's, Karbonn Mobiles and Danone Waters, the joint venture between Danone and the Mumbai-based Narang Group, which launched the drink B'lue last year, say they will turn to historical data when taking their investment decisions during the blackout phase.
Shashin Devsare, executive director, Karbonn Mobiles, says, "The ratings-dark period is one concern that the entire industry has. During this period, brands and media buying organizations will have to rely on past data and go with their gut instinct when investing advertising money on channels."
"There is no other option," says Tarun Arora, chief executive, India business, Danone Waters. "Historical data should give us some direction in the event there is a media-dark period. We can't do without ratings since it gives us a basis when parking our advertising money," he says.
In many ways, the blackout that advertisers are staring at is unprecedented since there has never been this long an absence of TV ratings. In October 2012, when TAM temporarily suspended providing ratings due to digitisation, it was only for a period of nine weeks.
More importantly, the first half of this year is crucial thanks to the addition of the general elections to an already hectic calendar including the second season of the Aamir-Khan-anchored Satyamev Jayate on Star Plus and the seventh edition of IPL on SET Max.
According to media industry estimates, the advertising money riding on news, Hindi general entertainment and sports this year will be in the region of Rs 8,000-9,000 crore. Of this, nearly half will be spent in the first half of the year, making it difficult for companies to take proper investment calls without ratings.
Sharma of Honda says, "I hope there is some sort of understanding that is struck (with regard to extending the TV rating guidelines). We do need a place to tabulate the data. Managing media plans based on previous year's data is not foolproof at all. The audience is dynamic. Especially with the upcoming auto-expo, we have a slew of launches to plan for."
