A wake-up call for Indian advertising

Last week, sleuths of the Competition Commission of India (CCI) "raided" all of India's top media agencies. Charges? Cartelisation and collusion.

- SANDEEP GOYAL

Last week, sleuths of the Competition Commission of India (CCI) "raided" all of India's top media agencies. Charges? Cartelisation and collusion. Since then reams have been written in the media about what allegedly triggered the antitrust watchdog's action. But no one has really delved into why this collusion ever happened (if it did), and when this sordid saga began — because this murky episode is likely to leave Indian advertising bruised and scarred for a long, long time, and understanding its genesis is important.

The advertising business in India was a comfortable 15 per cent commission business for decades and decades, patterned on global precedents and practices. Since the business was fun and the money was good, graduates from top business schools happily joined the advertising industry. My own boss at Rediffusion, Diwan Arun Nanda, was the gold medallist of the first batch of IIM Ahmedabad in 1966. Mr Nanda's partner at Rediffusion, Ajit Balakrishnan, was from one of the first few batches of IIM Calcutta.