In a hearing on Wednesday, the Delhi High Court directed the government to respond to Kantar's petition of last week challenging the new guidelines, notified on January 16.
These prevent a single entity from having paid-up equity in excess of 10 per cent simultaneously in a rating agency and broadcaster, advertiser or advertising agency. TAM has got 30 days to undo its cross-holdings in line with the guidelines. It says this is not possible, implying it will go out of business if the guidelines come into effect.
The government will make its argument on February 11, the next court date. After this, a decision will be taken on whether or not to grant Kantar a stay order.
Advertisers and media agencies have been keeping a close watch on developments, since absence of a stay will mean a media-dark environment for six-seven months. It will take till then for an alternative ratings system to be launched; one has been promised by the Broadcasters Audience Research Council (BARC), a body backed by the Indian Society of Advertisers (ISA), Indian Broadcasting Federation (IBF) and the Advertising Agencies Association of India (AAAI). BARC is expected to launch a new ratings system in October. However, most advertisers have said a period without ratings in the interim is untenable.
"We cannot be in a situation without data,” said a top official at Hindustan Unilever, the country’s largest advertiser. “We will have to find a way to extend the current system till the alternative comes into effect.”
Anita Sharma, assistant vice-president, marketing communications, Honda Cars India, says: "I hope there is some understanding that is struck (on extending the deadline for the guidelines). Managing media plans based on the previous year's data is not foolproof at all. The audience is dynamic. Especially with the upcoming Auto Expo 2014, we have a slew of launches to plan for."
Articulating the concerns of advertisers and media agencies, Arvind Sharma, president, AAAI, had said, "Absence of TRP data will not help (media) agencies and advertisers because there will be no basis to buying advertising time. This will be detrimental to the TV advertising business."
According to estimates, the advertising money riding on news, Hindi general entertainment and sports channels this year will be 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.