Feature – TRAI’s Advertising Regulations and the Impact on Sports Broadcasters.

Introduction
On 14 May 2012, the Telecom Regulatory Authority of India (“TRAI”) issued “Standards of Quality of Service (Duration of Advertisements in Television Channels) Regulations, 2012” (“Regulations”). These Regulations will come into effect upon due notification in the Official Gazette of India.

TRAI has portrayed these Regulations as a battle for reclaiming the comfort of the viewers of TV channels in India against an overdose of advertising and the move has been welcomed by consumer groups. Commercial producers and creative agencies, and industry groups (especially the Indian Broadcasting Foundation (IBF) and the News Broadcasters Association (NBA)), have come out strongly against the Regulations alleging unnecessary interference, over- reaching and even unconstitutionality.

The Regulations not only modulate the nature of advertisements but also their duration on a clock-hour basis. Advertisements during live sporting actions are dealt with separately under the Regulations. The guidelines are purportedly in furtherance of the objectives of the Cable Television Networks (Regulation) Act, 1995. Before the extant provisions, the format and duration of advertisements on TV channels were already regulated under sub-clause (10) and (11) of clause 7 of the Cable Television Networks Rules, 1994. 

Background

The increasing duration and distracting formats of advertisements were brought to the notice of TRAI through numerous consumer complaints and opinions expressed in various fora. The complaints covered a wide amplitude of problems with respect to duration, repetition, increased audio levels in ads, and misplaced break timings that hamper viewing continuity, among other things. the adverse effect that the irregular airing of advertisements had on the viewing experience of consumers. In light of the above, TRAI sought to review the existing set of regulations. Moreover, although the Advertising Standards Council of India (“ASCI”) regulates ad-content, it does not deal with regulatory issues with respect to duration, format and timings of such commercials. Since TRAI has been entrusted with the discharge of certain functions, inter alia, to regulate the telecommunications services and to protect the interests of service providers and consumers of the telecom sector, it proceeded with reviewing the existing regulations.

Regulations in question

Some of the key provisions of the Regulations are as follows:

1. Broadcasters may not carry advertisements exceeding 12 minutes in a clock-hour. Any shortfall of advertising in one clock-hour may not be carried over to the next clock- hour. This limitation is inapplicable to the broadcast of live sporting events.
    
2. The time gap between the end of one advertisement session and the commencement of the next advertisement session is not to be less than fifteen minutes. The time gap must be at least thirty minutes in the case of the broadcast of a film or movie. This limitation is inapplicable to the broadcast of live sporting events.
    
3. In the case of sporting events being telecast live, advertisements may only be aired during the ‘breaks in the sporting action’.
    
4. Only full screen advertisements are permitted and part screen and drop down advertisements shall not be broadcast.
    
5. The audio level of advertisements shall not be higher than the audio level of the programmes being broadcast in that channel.
    

The Ten Cricket Dispute

Sports channel Ten Cricket, one of the official broadcasters of the India-South Africa series during December 2010-January 2011, came under the scanner of the Ministry of Information and Broadcasting due to the advertisements that popped up in the middle of the screen even while the match play was on. Several complaints were received in this regard, which finally resulted in the Ministry serving a show-cause notice to the channel for the violation of the advertising code. The pop-up ads were said to be in violation of Rule 7 (10) of the Advertising Code prescribed under the Cable Television Network Rules, 1994, which provides that "all advertisements should be clearly distinguishable from the programme and should not in any manner interfere with the programme viz, use of lower part of screen to carry captions, static or moving alongside the programme."

Advertisements during live Sporting Action

Part D of the Regulations deal specifically with advertisements during live sporting action. The limitation of 12 minutes per clock hour is not applicable to live sporting events nor is the minimum gap of 15 minutes between the ad breaks. However, these relaxations are not applicable to deferred broadcasts of sporting events and highlight shows and packages. With respect to live broadcast of sporting event, ads can be aired only during the breaks in sporting action. Though the regulation is not specific about what constitutes ‘a break in sporting event’, by convention it can be presumed as the half-time in case of football and hockey, game/set change in case of lawn tennis and in case of cricket lunch/drinks break or an over-break, a fall-of-wicket or the incidence of a player injury (or similar event) but not (otherwise) a break between deliveries. Importantly, the nature of the advertisements should be in such a way that the program must be fully visible and must be distinguishable from the advertisements. In other words, the advertisements must be full screen and squeezebacks (L-shaped ads that reduce the size of the match play screen) will not be permitted. Commercial on- screen logos, bugs, tickers and bands are also prohibited by the regulation requiring all ads to be fullscreen only.

The Linkage with Advertisement Revenue

The Regulations have not been received favourably by broadcasters and, especially so, sports broadcasters given the high production costs and rights fees they are saddled with. Advertisements are, no doubt, an important source of revenue and any sort of restriction on duration and frequency will certainly have an impact on the sports broadcast business model. Broadcasters are of the view that self-regulation is most appropriate, claiming that broadcasters themselves (by virtue of their responsiveness to the highly competitive entertainment market) are best-placed to balance commercial interests and viewer comfort.

Conclusion 

Globally, a few other nations have regulated the duration and nature of advertisements. In Australia, the ‘Revised Commercial Television Code of Practice’ stipulates that in an hour, on an average, no more than 13 minutes of advertisements may be scheduled between 6.00pm and midnight outside election periods and 14 minutes during the election period. Where the amount of non-programme matter scheduled during any hour of a broadcast of a live sporting event is less than the average permitted, it provides for scheduling of the advertisements during breaks from live action (including pre-match, post-match and half-time coverage) or elsewhere in the same time zone on that day.

In case of the United Kingdom, Ofcom, the independent regulator and competition authority for the UK communications industries amended the Code on Scheduling of Television Advertising (COSTA) after the completion of digital switchover in 2012. COSTA lays down guidelines requiring advertisements to be clearly distinguishable from the editorial content. Moreover, where advertisements are inserted between programmes, it puts the onus on broadcasters to ensure the integrity of the programme and have regard to the nature and duration of the programme.

In India, TRAI has attempted to deal with the issue of the appropriate nature and duration of television advertising. The Regulations are not new but an elaboration of a clause in the Advertising Code. It is TRAI’s contention that it is responsible for quality of service provided to the consumer and thus regulating disruptions to the viewing of TV programs through advertisements falls within the ambit of its powers. The broadcasters and their representatives believe otherwise and it appears that the government may be in a position to relent, stating its willingness to receive representations from the industry. The battle lines have been drawn and the it is probable that that last word has not yet been written on this issue.