Goafest 2010: Reduce ad inventory to rationalise rates

GOA: In a scenario where the top 20 Indian broadcasters suffer a combined loss of $39 million, a possible way out is to reduce ad inventory to rationalise rates.

"TV broadcasters need to unify and consolidate to reduce ad inventory from the current average of 23 minutes per hour to help rationalise ad rates," said UTV Software Communications CEO Ronnie Screwvala, while speaking at the fifth edition of Goafest 2010.
Elaborating further, Screwvala noted that an increasing number of channels, segmentation and fragmentation are pushing ad rates southward.

Star India CEO Uday Shankar also echoed the thought that broadcasters are hurting and the time had come to address several issues. "Though television ad revenues had gone up by 16 per cent in 2009 and some of the broadcasters such as the Zee group did report profits, the top 20 broadcasters incurred losses to the extent of around $39 million in the year," he said.
The main causes are high cost of content (up by 40 per cent year-on-year in the case of GECs), personnel (up by 40-45 per cent) and carriage fees (up by 43 per cent).

Though the mobile and the television industry started around the same time, the former is now a $25 billion industry with around 500 million connections and 400 million users as opposed to the television sector which had a reach of about 520 million and revenues of just $2320 million, rued Shankar.

Both Screwvala and Shankar urged for a suitable measurement matrix that would go beyond households to other aspects such as innovation.

The panel discussion on "Time to grow the advertising pie" was moderated by Lintas Media Group chairman and CEO Lyn deSouza. 
Lodestar Universal CEO Sashi Sinha noted that CPT (cost per thousand) was one matrix that could be used across all media platforms. He also noted that there was scope for entry of more television channels, print magazines and multi-niche players in India.

The Times of India Group executive president (response) Bhaskar Das said that the print sector needed to innovate further to drive in ad revenues which stayed almost flat last year.

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