Billboards not fetching BBMP, ad agencies any green bills

Industry has registered 50 pc drop in revenue over past six months

Billboards not fetching BBMP, ad agencies any green bills

On a year-on-year basis, the Bruhat Bangalore Mahangara Palike (BBMP) too has seen a drop of almost 20 per cent in its revenues from the hoardings.

The city currently houses nearly 3,000 hoardings in mostly commercial areas.  BBMP permission is mandatory for putting up a hoarding. A three year contract is signed with advertising agencies which will pay the advertising tax to the Palike. Each square centimetre of the outdoor hoarding will earn the BBMP anywhere from Rs 56 (non-illuminated) to Rs 87 (illuminated) as tax from the advertising agency. The agency can charge from Rs. 2 lakh for a 25 x 12 square feet to a higher rate depending upon the size, height and the zone where it will be displayed.

While advertising agencies accuse the BBMP of “exploiting” them with high tax rates, most feel that the recession has been quite harsh on these companies handling outdoor hoardings. “The recession effects have definitely been felt in the past six months by the advertising world. Some of the big advertisement hoarding companies have been shutting shop,” said Bharathi with Aspire Advertisements.

Two-year-old Aspire Advertisements handles nearly 25 hoardings in the city. Currently they have seven hoardings vacant. “This is the first time in my my two years that the hoardings have been vacant,” said Bharathi. The revenue receipts have fallen by almost 50 percent for the company over the year.

It is the same story for most agencies in the city. Another company in the city said that their agency has also witnessed downturn in revenue by as much as 40 per cent. “I guess in times of recession it is every company’s prerogative to cut expenditures,” said a advertising professional.

With revenues falling and high taxes by the BBMP, the agencies are definitely in a spot of bother as their vacant hoardings seem to be increasing. Jaffer, another personnel in outdoor advertising hoped that the new bye-law brought out by the Palike had some sort of relaxation in the taxation rates.

Not our priority

But the BBMP commissioner, Subramanya said it was not his priority to think about the financial trouble the ad world was facing. “My priority is to visually beautify and maintain the city. This will be a deterrent for the hoardings to mushroom in places illegally,” he said.

As the advertising world looks out for clues of revival in the global financial scenario, all eyes are set on the State Government for their ratification of the new bye-law mooted by BBMP on how the billboards are to be distributed in the city and if any, but a hope of relaxation on taxes. 

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