Advertisers want to renegotiate rates

Advertisers want to renegotiate rates
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First Published: Tue, Mar 27 2007. 12 00 AM IST
Updated: Tue, Mar 27 2007. 12 00 AM IST
Stung by India’s first-round exit in a cricket tournament where they were at least expected to reach the last four, advertisers want Sony Entertainment Television (SET), the company that has the television rights to all ICC World Cup matches, to renegotiate their contracts.
According to sources close to the development who did not wish to be identified, PepsiCo India is looking at a potential loss of Rs18-20 crore (the total spend on its Blue Billion campaign), and is in talks with SET seeking a solution that is fair to both parties. “Pepsi is not pulling out on its investment with SET MAX (the Sony channel that telecasts world cup matches),” said M.K. Machaiah, senior business director, Mindshare, the agency that handles media buying for PepsiCo. “But they are in talks to see what is best for the sponsor and the channel,” he added.
The Indian Broadcasting Foundation and the Advertising Agencies Association of India (AAAI) believe any demand by advertisers at this stage is unjust. “Had India done well, no advertiser would have been asked to pay extra for that,” they said in a joint media statement.
Advertisers are looking at a potential loss of Rs100-150 crore that has been sunk into a long-term contract with the channel for an event that most Indians will likely not watch any more. “This situation has never risen before because I don’t think any Indian advertiser has put in so much money into an event,” said Dara Acidwalla, secretary-general, AAAI.
Madison Communication is also trying to arrive at a settlement with SET MAX. “Our clients are concerned and we are looking at how we can best renegotiate the deals to keep both sides happy,” said Punitha Arumugham, the agency’s CEO.
Sony, though is playing hardball. “We have signed contracts,” said Rohit Gupta, executive vice-president, SET MAX. “We have not sold contracts on the basis of the Indian team winning,” he added.
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First Published: Tue, Mar 27 2007. 12 00 AM IST
More Topics: Marketing and Media | Advertising |