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Media Owners oppose SDMC by not participating in Tender rollouts

03, March, 2016

Bhawana Anand, New Delhi

To fight against the unbearable conditions of SDMC, the media owner community decided not to participate in their tender process. But how this clash would affect the Delhi OOH Industry is what we tried to find out by talking to few market representatives

Municipal Corporation of Delhi and Delhi based Media Owner fraternity has always shared a bitter relation over several issues like rates, taxes, permission and etc. However, this time the situation has gone little more out of control. South Delhi Municipal Corporation (SDMC), which handles South and West area, rolled out tenders for both locations to allot Unipole property, but in a way to oppose them, none of the media owner participated in any one of the tender rollout.

Objectionable Terms & Conditions

The media owner collectively decided not to participate because of the harsh terms and conditions, especially the short duration of property allotment and high reserve price, presented by SDMC for their Unipole tender. As explained by Mukesh Gupta, CMD, Graphis Ads, "The Corporation has been releasing tenders on its own terms and condition, which are totally unacceptable for any of the Delhi based media owner. The Municipal Corporation isn't trying to evaluate the poor conditions of the outdoor market, which is pretty severe currently because of no big campaigns and no profit margins. But still the Municipal wants to increase 10% of Reserve Price every year which is a big burden on us. Media owners likes to participate for tenders which has profitable and easy to handle properties".

"As well as Selvel Media is concerned, we deliberately don't like to participate in Delhi Municipal tenders, considering shorter durations, advance payment for 6 months of tender and high Reserve Price.  The market is so volatile that there are no assured returns on investments therefore I personally don't see a point of investing in Delhi", said Tanmay Das Gupta, General Manager, Selvel Media.

The media owners' aggression has another reason as well i.e. not permitting Wall Wraps in Delhi. "The authority thinks that wall wraps are hazardous for the city as any vehicle can bang into it and cause an accident, but why don't they understand that this can happen with other format too such as Unipole. There reason for not permitting wall wraps is absolutely baseless and to make this point, the investors are avoiding the tender process. Also, we didn't participate in Unipole tender because of the short duration of the tender, which doesn't serve good to anybody. There is no point in losing on the revenue and forget profit but in 6 months we can't even breakeven with the investments", articulated, Deepti Kumar, Manager- Operations, Icons Outdoor.  

Is it a protest?

When disapproval is quite a fad these days, so is it a kind of protest from Media Owners? "Yes, it is a protest from the media owners community. They have to consider the interest of media owners who are giving them huge amounts as licenses fees and taxes. Moreover we should have budgets to shell out for such heavy tenders but we don't have that.", articulated Mukesh. 

But what made the media owners take this bold step? "Absolutely we are protesting because lately the corporation has become too harsh. If we go back in time, the authority wasn't that rigid, but now there is no scope left for any adjustments", said Sarvesh Baliyan, Director, Shine Arts.

Whose loss is it?

It would be unfair to say that only the Media Owners are the ones bearing the burden due to this battle. Even the Corporation is losing out big moolahs due to this battle. "SDMC is losing out approx. 2 crores per month as a revenue from this tender. It is so unfortunate that a authority can earn such handsome amount for the development of the city but they are so stubborn with their terms and conditions", explained Mukesh.

Not only this, Mukesh feels that unsold property is affecting the look & feel of the city. "We have a big initiative 'Swach Bharat Abhiyaan' underway in the country and OOH can play a vital role in making the city clean, beautiful and presentable, but non-tendered media is left dirty and useless", added Mukesh.

For media owners, it is equally a big loss. "South Delhi is such an important location from advertising viewpoint. If the situation continues to be same, then it is going to affect the Delhi Outdoor business. The advertising budgets are already going to Tier I & II cities and to other formats", said Tanmay.

Opportunity or tragedy?

Delhi as an OOH market is already short of display formats and out of handful of available media, can media owners actually afford to lose out Unipole format or are they going to hunt for another kind of media? Answering to this, Sarvesh said, "Yes we will have to look for another media if this won't settle down soon. We have DMRC outside and inside media which offers longer duration tenders and Mall Media which is quite up-market, so we will invest in them".

Adding more on this, Mukesh said, "Due to this, the budgets will shift another formats like BQS and to different markets of Delhi".

"This will lead media owners to invest in other formats like Public Utilities, Metro Pillars like other companies such as JCDecaux and Times OOH are doing", added Tanmay. 


So what do Media Owners demand? "We want to initiate dialogue with the authority and want them to listen to our viewpoint as well. Since it is a two-way business we should bring issues on the table", opined Deepti.

Agreeing to this, Mukesh added, "The corporation should work in collaboration with DOAA and Media Owners.  We are not saying they should agree to our terms & conditions, but at least come on common-grounds of agreement which works in their favour and ours too."

Survesh, who met the authority just before talking to Allaboutoutdoor shared, "We have just met the authority and explained our points. And they have asked us to file the report of the same to take it forward".

Delhi Outdoor Advertising Association Dialogue- Umesh Singh, Vice President, DOAA

How do you think avoiding tender will help the media owners?

Ans.   Well they should understand that it is we the media owners who generate revenue from their barren land, so we should be heard and should be treated respectfully to amicably solve the issues of outdoor advertising and should understand the difficulties faced by the media owner on ground.

What is DOAA doing to sort this issue?

We have tried to contact the commissioner to discuss & resolve the issues, but he is too busy to talk on this issue and the department is hell bent on framing rules and regulation on their own sweet will, and it is the reason that there is a severe dip in revenue and tenders are failing to attract the bidders.

Are you planning to take this matter to the High Court?

Not now, will wait and give more opportunity to SDMC to talk over the matter. We believe in a dialogue to solve the matters instead of putting it to the court to take the time to decide.

What sort of loss is MCD going through and what problems are faced by the media owners because of this?

SDMC is facing a great loss, from 55 cr. Revenue last to last year they have dropped down to merely 30 cr. this year. With expenses gone 3 times on court matters. Whereas media owners are facing loss because of law-less, short sighted policies of SDMC officers. An uncertainty in market is prevailing, forcing clients to deviate their budget from outdoor to TV and social media.

Till when are media owners planning to avoid the tender process?

Till the time SDMC and Media Owners sit across the table and reach a mutually accepted solution on the rules, regulations and policies of OOH. It will give the due recognition and importance to the Media owners.

Tags :  DOAA Municipal Corporation of Delhi MCD South Delhi Municipal Corporation of Delhi SDMC Mukesh Gupta Tanmay Das Gupta Selvel Media Graphis Ads Deepti Kumar Icons Outdoor Sarvesh Baliyan Umesh Singh Shine Arts


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