Thursday, 10 April 2014

TRAI policy of 12 minute ad cap becomes furor for news broadcasters.

Rejoice came for TV broadcasters as Delhi High Court on 13th March 2014 in its interim order continued the stay on Telecom Regulatory Authority of India (TRAI) ad cap regulation which limits their airing of advertisements to 12 minute per hour. Hearing the petition filed by News Broadcasting Authority (NBA) against the sector regulator’s 12-minute ad cap regulation, the Delhi High Court warned Telecom Regulatory Authority of India (TRAI) from taking any coercive action against petitioners.  Despite being protected by the interim relief, the petitioners have to submit a weekly report on the consumption of commercial airtime in a clock hour. 
Telecom Regulatory Authority of India (TRAI) decision to cap broadcasters' advertising time at 12 minutes an hour did not go down well with many news and regional channels, which went to court, claiming this would make them financially unviable and violate their fundamental rights under article 19 (1)(a) and (g) of the Constitution. Earlier News Broadcasters Association and some entertainment channels had approached TDSAT challenging the implementation of the 12 minute ad cap contending that TRAI does not have jurisdiction to regulate commercial airtime on television channels. But TDSAT has dismissed petitions filed by News Broadcasters Association and entertainment channels, following an order by Supreme Court which said the Tribunal has no jurisdiction to hear any appeal challenging any regulations framed by the sectoral regulator.  The Supreme Court on December 6, 2013 had passed this order in the case of telecom operators Vs TRAI.
After TDSAT dismissed the petition, NBA moved to Delhi High Court against TRAI’s 12 minute ad cap regulation. The Delhi High Court on 17th December 2013 in its interim order had given broadcasters some relief barring TRAI from taking any coercive action against the news broadcaster for not following the 12-minute mandated ad cap till the case is settled. A senior member of News Broadcasting Association (NBA), which had filed the petition while speaking with media, said that the TRAI order was not practical. “We have been saying this since the beginning that implementing the ad cap is not possible until we get the benefits of digitisation,” the member said. Digitisation ensures that cable operators don’t under-report subscriber numbers, which determine ad revenues that channels can earn. Broadcasters also contend that It is difficult for them to carry 12 minutes of advertisements because mostly they have retail advertisers who cannot afford high ad rates. 

Ad Cap Regulation
In March 2012, the Telecom Regulatory Authority of India (TRAI) came up with a detailed consultation paper on “Issues related to advertisements in TV Channels.” Two months later, it notified the Standards of Quality of Service (Duration of Advertisements in Television Channels) Regulations, 2012 (15 of 2012) in consumer interest that mandated all TV channels not to have more than 10 minutes of commercial advertising and two minutes of own promotion in each clock hour. However, news broadcasters and some music channels had challenged the regulation. TRAI then reconsidered the matter and, on March 22, 2013, notified a revised regulation called Standards of Quality of Service (Duration of Advertisements in Television Channels) (Amendment) Regulations, 2013. This amended regulation retained a key provision of the principal regulation, i.e., “no broadcaster shall, in its broadcast of a programme, carry advertisements exceeding twelve minutes in a clock hour.” 
The broadcasting fraternity, led by the News Broadcasters Association (NBA) and the Indian Broadcasting Foundation (IBF), has vehemently opposed TRAI’s move. 
Narayan Rao president of News Broadcasting Association (NBA) said that, it is an extremely draconian step. It ignores the ground reality. News channels don’t have any alternate source of revenue. Markets are depressed and the carriage cost is still high,” 
However many of the General Entertainment Channels (GECs) have started implementing this ad cap policy, but news broadcasters have not done the same. 
The broadcasters’ main grounds of opposition are:
1) TRAI has no power to notify such regulations; 
2) TRAI’s regulation is against the fundamental rights guaranteed under Article 19(1) (a) and (g) of the Constitution; 
3) Advertising revenue is the lifeblood of the media and TRAI’s regulations were issued at a time when news channels are facing a most unfriendly business environment, non-receipt of advertisements from the Directorate of Advertising and Visual Publicity (DAVP) and the low level of digitisation in the country; 
4) The regulations, if implemented, will force many news organisations to shut down. With the General Election looming ahead, it would appear that this is an attempt to muzzle the media by taking away its ability to operate independently. 
However when Cable Quest approached Cable Operator Federation of India (COFI) president Roop Sharma about the contention of the broadcasters, she countered all the arguments one by one. 
1) She said that Union government in the year 2006 had already notified a law under Cable TV Rule 1994. Under this Rule 7 (11) that defines advertisement duration in TV channels, the 12 minute cap is mentioned. TRAI is only implementing this Rule now.
2) On the Fundamental rights violation she said that, the regulation was made in Consumer interest after considering norms in the international market. She further stated that all broadcasters have been violating the law since then and for some reasons the Ministry decided to overlook these violations for many years. TRAI did not do anything against the law. Moreover, as contested by the Ministry in many cases in the Courts against DAS regulations, an action taken to protect the larger public interest can not violate any one’s Fundamental Right. 
3) The 12 minute ad cap Rule was framed much before the digitization amendment was brought in 2011. No broadcaster had challenged the cable TV Rule then. Also the Rule was amended considering international practices and no law can be allowed to be violated under the excuse of stake holders not making enough money. Any broadcaster who feels so, can close his business and restart when the market is good.
4) News broadcasters knew the law when the channels were launched. Why did they take it for granted that they will be allowed to violate the law?
TRAI’s position on Ad cap
On the other hand TRAI states that the duration of advertisements carried during programmes on TV channels is closely related to the quality of viewing experience of consumers. The quality of viewing experience is akin to the “quality of service” provided by the service providers to consumers, which can very well be regulated by TRAI. This clearly shows that TRAI has the necessary powers to regulate the duration of advertisements on TV channels. TRAI further states that the cap on advertisement duration to 12 minutes per hour is already a part of an existing Advertisement Code, i.e., Rule 7(11) of the Cable Network Regulation Rules, 1994. It reads: “no programme shall carry advertisements exceeding 12 minutes per hour, which may include up to 10 minutes per hour of commercial advertisements, and up to 2 minutes per hour of a channel’s self-promotional programmes.” TRAI’s revised regulation doesn’t disturb this existing statutory position and only adds that “hour” means “clock hour” and proposes to enforce the said rule.
A study conducted by the Centre for Media Studies (CMS) on the duration of advertisements in six major news channels over the last four years found that on an average, around 35 per cent of the prime time (7 p.m. to 11p.m.) of news broadcasters is just advertisements, against the per hour limit of 20 per cent prescribed in the existing rules. The maximum yearly average was found to be as high as 47.4 per cent.
Global Codes
Lastly, almost all countries with a free media have codes in place to regulate the duration and scheduling of television advertisements. For example, the Audiovisual Media Services (AVMS) Directive of the European Union which sets the limit of advertising for all channels to be 12 minutes per hour, establishes the need to “protect the interests of consumers as television viewers, particularly by ensuring they are not exposed to excessive amounts of advertising which is also detrimental to the viewing experience.” But these international best practices are conveniently ignored by the broadcasters in their arguments. Media houses going to the extent of painting this viewer-friendly regulation by TRAI as the government’s attempt “to muzzle the media” in view of the upcoming election is a deliberate effort to obfuscate the debate.
TRAI has in fact dropped many other key provisions that were a part of the original regulation such as prohibition of part-screen advertisements during programmes and the audio level of advertisements not to be higher than the audio level of programmes. 
If broadcasters feel they have a genuine case that the present statutory cap on advertisement duration is impacting their interests adversely, they can pressurise the government (not TRAI) to amend the extant Rule 7(11) of Cable Network Regulation Rules, 1995 so as to increase the present cap of 12 minutes further, say, to 15 minutes. Instead, the broadcasting fraternity’s blanket opposition to the TRAI regulation, based purely on business considerations, is unwarranted. It not only shows its disregard for the relevant legal provisions presently in force but also its disrespect for the due rights of millions of TV viewers in the country.
It is also very strange that TRAI is not fighting all out for the consumer interest for which the Cable TV Rule was made. Experts feel that even the Ministry could have intervened to protect the public interest and ensured that all provisions of the law were protected against vested interests of a few broadcasters. TRAI should not have even removed the provisions regarding audio levels of ads on TV channels and multiple formats of ads on the screen. Broadcasters have many ways to earn revenue including the following:-
a)Full screen adsb)Scrolling ads
c)Logo adsd)Vertical banner ads
e)In content adsf)Sponsored programmes,
g)Paid news.h)Subscription revenue as many news channels are also ‘Pay’ channels.
One also wonders why TRAI has not brought out these facts. Also the Courts must consider the case from consumer point of view and not purely a case of legality of the Regulator to frame any regulation concerning the advertisements in TV channels. It is not a question of fundamental right of the broadcasters to earn revenue but is a question whether government will allow broadcasters to run their business without any regulatory framework giving them full hand to earn according to their wish exploiting the masses. 


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