While the Indian regulators had just imposed the 10+2 ad-cap on the Pay channel, the Russian regulator has gone ahead in banning the advertisement completely on Pay TV models to avoid the dual revenue model and help the Free to Air channel (FTA) to survive solely on the advertisement revenue.
Turner Broadcasting-owned US news channel CNN recently revealed it will cease broadcasting in the country at the end of this year after Russia introduced a bill in July to ban advertising on pay TV channels.
Many foreign broadcasters are facing the prospect of having to drastically overhaul their business models following the changes, which will effectively see all advertising on pay TV and cable channels banned from 2015.
The changes are intended to help Russian free-to-air channels compete with pay networks, which have dual revenues streams – advertising and subscriber fees – while FTA networks rely on advertising.
The Russian government has also introduced plans to extend a law restricting foreign ownership of channels, posing a threat to ventures from global players such as MTG and Viacom.
Those changes will stop international companies holding more than a 20% stake in Russian mass media businesses, and will apply to all existing and future operations. The current law limits foreign ownership at 50% for channels that broadcast to at least half of Russia’s population.
Numerous international broadcasters operate in Russia, including Viasat Broadcasting, Viacom, NBCUniversal, Disney, Fox International Channels, Turner Broadcasting, Sony Pictures TV, A+E Networks and Discovery Networks International.