Self-declaration mandate hits publishers and media houses as brands pause new ads

Significant impact on revenue awaits if the situation remains the same, say industry leaders. 

The Supreme Court of India issued a directive on May 7, 2024 mandating all advertisers and advertising agencies to submit a self-declaration certificate before publishing or broadcasting any advertisement from June 18, 2024 onwards.

The mandate has caused significant upheaval across the media and advertising industry. Endless questions and doubts have arisen, ranging from who is responsible for filing the declarations to the extent of the mandate's applicability for ads.

There might be a slight hope as the Ministry of Information and Broadcasting (MIB) is considering reducing the number of sectors requiring self-declaration certificates (SDCs) for advertisements. However, media houses and publications are already feeling its impact.

According to leaders in the media industry, advertisers have hit pause on newer ads, affecting their business.

Impact on revenue 

Avinash Pandey, CEO of ABP Network, says certain advertisers in sectors such as BFSI and pharmaceuticals are postponing the release of new ads due to a need for clearer guidance.

Mona Jain, chief revenue officer at Zee Media, states that many campaigns scheduled for July have been delayed due to the SDC mandate. "My projection for June got delayed to July and is now delayed to the next month. So, obviously, there has been an impact on revenue," she explains.

The revenue head of a prominent news media publication, who did not wish to be named, states that international advertising and sponsored content have been most impacted. "International brands are very particular about legalities. We ourselves are decoding the situation, so it's natural for them to also be cautious," he explains.

However, Amit Tripathi, chief revenue officer, TV9 Network adds that there is no slowdown as people can still advertise campaigns that started before June 18, 2024 and many new advertisements are getting SDC.

Publishers’ concerns

As per leaders, programmatic ads remain the number one concern. The media house revenue head further says that while their programmatic ads vertical has not been immediately been impacted, that may be because the creatives are older than June 18, 2024.

“When it comes to programmatic ads, we also don’t know who the advertiser is. It’s all based on personalisation. An average publisher makes almost 50-70% of revenue from programmatic ads. We make almost 30% from programmatic ads. However, if the situation continues as it is, advertisers will be scared, and a law-abiding advertiser may also pull out because, in most instances, platforms like Facebook and Google create those ads on the go. Millions of creatives are released everyday, how is one expected to declare them all," he states.

Pandey of ABP Group states that at the broadcaster level, there are a few procedural concerns that still exist and require clarification.

"Discrepancies have been noted between the self-declarations submitted by advertisers or ad agencies and those uploaded on the portal, such as mismatches in duration or caption. While broadcasters are not responsible for verifying the accuracy of these submissions, their acceptance should not be seen as non-compliance on the part of the broadcaster."

"It's unclear whether separate self-certification is needed for L Band or if certification for the main advertisement covers all formats, FCT or Non-FCT (Free Commercial Time). These issues underscore the complexity and challenges arising from the SDC mandate implementation, necessitating further clarification and streamlined processes for all stakeholders involved," he adds.

How are companies navigating the situation?

According to Pandey, ABP Network is actively preparing for the new regulatory framework as a media house. He says, effective June 18, 2024, it is fully compliant with the self-certification requirements for new promotions on both its linear and digital platforms.

In addition, it has advocated through industry associations to expand the scope to include self-advertising and promotional content for movies, among others, says Pandey.

Pandey notes that various associations such as International News Media Association (INMA) and Internet and Mobile Association of India (IAMAI) have filed for impleadment in the Supreme Court seeking clarification on these regulations. Indian Broadcasting & Digital Foundation (IBDF) also has a plan prepared for intervention and may act as necessary by 9 July 2024, pending the progress of legal proceedings.

“Meanwhile, we have initiated correspondence with Google and our other programmatic partners to ensure compliance. While responses may not be immediate, we are committed to securing self-declarations for all new promotions from our direct digital partners. The regulatory landscape is evolving rapidly, presenting new challenges and perspectives every day. We remain dedicated to adapting and learning in this dynamic environment,” he adds.

Jain of Zee Media states that much of its revenue comes from smaller retailers in smaller towns. “These people need to be equipped with the mandate's requirements, and we are also trying to figure out how we can help them. People are accepting it, sampling it, and understanding it. As of now, there are mostly older ads running. The impact is on linear as well as digital,” she explains.

"The Supreme Court's next hearing is on July 9, 2024. We hope this will provide clarity on the grey areas and address any other concerns advertisers might have," adds Tripathi of TV9 Network.