Mumbai: Reliance Industries Ltd ( RIL ) and Walt Disney are mulling to propose to the Competition Commission of India ( CCI ) a two-year freeze on advertising rate cards in their latest effort to win the competition watchdog's approval for the Star India and Viacom18 merger, said people familiar with the matter. RIL and Disney, which are seeking to complete the merger by October, have been scouting for ways to assuage the regulator's concerns about the potential impact of the merger on the Indian media and entertainment (M&E) industry. "The proposal being discussed internally is to provide a two-year price freeze on ad rate cards to all advertisers and agencies," one of the persons said.
A second person added that "both sides are confident that the merger deal will cross the CCI hurdle." "Price freeze on ad rate cards has the potential to allay CCI's concerns of the merger's impact on competition," the person said. Media agency officials believe RIL and Disney's proposal is interesting as it might help the Star-Viacom18 combine secure CCI approval, and that possible ad revenue loss due to the ad rate freeze will be low.
However, some officials argue that the merged entity will face negligible loss from the proposed rate freeze, especially for properties like the Indian Premier League (IPL), which have been badly impacted due to softness in advertising in the last two years. "Both Star Sports and JioCinema wouldn't mind keeping the ad rates unchanged considering they have bare.
