Broadcaster NDTV Ltd has decided to discontinue its ads-for-equities business, after striking deals with four companies, including Emaar MGF and the Delhi Stock Exchange. The firm holds a portfolio of Rs35-40 crore, according to a person with knowledge of the development, who asked not to be named. NDTV CEO K.V.L. Narayan Rao declined comment.
“The business was causing some discomfort within the company and the board, and hence it was discontinued,” our source said.
The firm will continue to do barter deals, a practice that has become common among media companies, under which ad inventory is traded for products and services such as real estate, cars, airline tickets, etc.
Several media companies, including HT Media Ltd, Jagran Prakashan Ltd and Bennett, Coleman & Co. Ltd did ads-for-equities deals in the market boom days and holds significant equity portfolios in public and privately held companies. The practice has been a lightning rod for criticism due to the inherent conflict of interest when a media outlet is covering a company in which the publisher/broadcaster has a financial interest in. Media firms have usually defended the practice, saying there is a chinese wall between the editorial and business sides and positive editorial coverage is not promised when such deals are struck.