Barely 20 months after it was announced, the ad sales alliance between news broadcaster NDTV Ltd and Star India has come to an end. On April 1, 2011, NDTV had signed deal with STAR India, wherein STAR India was to manage the advertising sales of NDTV’s news channels – NDTV 24X7, NDTV India and NDTV Profit.
In addition to the frontline sales, STAR India was also responsible for commercial back-office management such as traffic, scheduling, billing and collections.
According to industry sources, the deal had a minimum revenue guarantee of Rs 250-260 crore that STAR has offered. There was also a slab-wise revenue sharing formula. There was, however, no timeframe specified in the contract and it is learnt that if the minimum target would not have been achieved, the deal was to be called off.
Now as per new arrangement, the current STAR sales team that was working on the NDTV channels will be transferred to NDTV.
NDTV said in a statement that the two companies have taken a strategic decision to transition the sales and marketing function back to NDTV. "The relationship (with STAR) will continue at a strategic level. However, as always planned, NDTV will take its sales and marketing destiny into its own hands and the transition process has already begun. This will ensure close integration with a number of fresh initiatives that NDTV is launching," it said.
Prannoy Roy, Executive Co-Chairperson, NDTV, said "Working together with Star has been a great experience. We have developed a close professional relationship and plan to retain close ties at a strategic level".
Uday Shankar, CEO of STAR India added, "Star and NDTV and Uday Shankar and Prannoy Roy's relationship is a deep one. It was always meant to be a short term agreement to enable NDTV to effect a transition. Now that the team is ready and NDTV wishes to take charge of its own destiny we amicably agreed to exit."
Earlier, Kevin Vaz, President – ad sales at STAR India, was given the additional responsibility of the three NDTV channels. Prior to STAR India, Raj Nayak-promoted AIDEM Ventures was managing the ad sales of NDTV.
Prior to AIDEM, Nayak was with NDTV Group, heading the ad sales division – NDTV Media Ltd. Later, Nayak altered his arrangement with NDTV to form AIDEM Ventures in March 2010 and for one year, NDTV continued with Aidem for its ad sales requisites.
STAR India also had a 26:74 joint venture with ABP Pvt Ltd- Media Content and Communications Services (MCCS), which runs three news channels — ABP News, ABP Ananda and ABP Majha. Earlier this year, STAR and ABP parted ways and ABP bought out STAR's stake in the JV.
Both the oganisations will work towards ensuring the process is seamless.