Kantar hearing put off till July

Kantar, which owns a 50% stake in TAM Media Research had challenged the government decision to cap cross holding norms for rating agencies

The Delhi High Court on Thursday adjourned the hearing on a dispute between Kantar Media and the Centre till July, ensuring the company is not penalised for not complying with the new cross-holding norms for TV rating agencies.

The Centre in January decided to regulate the rating system and asked rating agencies to register with the information and broadcasting ministry by February 16. According to the new guidelines, no single entity can hold paid-up equity in excess of 10 per cent simultaneously in a rating agency and broadcaster, advertiser or advertising agency.

Kantar owns half of TAM Media Research,  the country's only TV ratings agency.

Kantar Media, then challenged the government's decision to regulate TV rating agencies since the regulation was to come into effect from February 15.

Kantar is part of the WPP group, which posted revenues inexcess of $10 billion in 2012 and TAM Media Research is the country's largest television ratings agency. Kantar had earlier informed the court of a possible blackout in the absence of a rating agency in the country, while mentioning that political reasons could also be behind the hasty implementation of the new guidelines when it presented its case in February.

"This is a major relief for the industry. In the absence of a television rating system, advertisers and broadcasters would have been affected badly. Broadcast Audience Research Council (BARC) is still setting up their rating agency and we believe something is better than nothing", Rohit Gupta, Chief Sales Officer at Multi Screen Media (MSM).

MSM has the broadcast rights for the Indian premier league, one of the costliest properties on India Television. The high court had stayed the contentious provision in the guidelines to cap cross-holding between rating agencies and broadcasters, advertisers and advertising agencies at 10% in February and decided to hear the matter in March.

Meanwhile, TAM will now comply with all other norms in the new act which include registering with the authorities and raising the number of panel homes that are used forthe survey to 20000. Television rating points, or TRPs, are often used as a parameter by advertisers before selecting a channel or programme to air ads.

With the ratings often being criticised for their small sample size and lack of transparency, the ministry asked agencies to increase the minimum panel size to 20,000 panel homes. Plus,agencies should raise the panel home size by 10,000 ever year until the size reaches 50,000 panel homes.

"From an industry perspective, with the IPL and elections around the corner, it is important to have a rating agency since the advertisers and media buyers have been feeling an uncertainty about spending. Given that BARC is still a long way down the road, TAM is crucial", Jehil Thakker, Head of Media & Entertainment at KPMG.

TAM India is a 50:50 joint venture between AC Nielsen and Kantar Media Research.The latter is part of the Martin Sorrell-led WPP Group, which operates a number of media agencies and advertising houses across the globe. GroupM, the largest media agency group in India (with billings to the tune of Rs1,000-1,200 crore in 2012) is a part of the WPP Group as are leading creative agencies such as O&M, JWT and Bates.

In an interview with Business Standard last year, Kantar chairman and Chief Executive Eric Salama had revealed his company would be interested in theratings business in India only as a joint venture with Nielsen, which is the current arrangement.