Shanghai TV changes to blanket rate plan

<p>SHANGHAI: Newly-formed media cartel Shanghai Media & Entertainment </p><p>Group (SMEG) has been accused of playing hard ball with advertisers as </p><p>it moves to tighten credit terms and reduce discounts for 2002. </p><p><BR><BR> </p><p>Media agencies, who have been asked to sign contracts containing the new </p><p>terms by November 25, said they were surprised that SMEG would introduce </p><p>a blanket rate policy in a weak market. "They are being far less </p><p>flexible, which leaves negotiation to specific terms," said a media </p><p>agency director. </p><p><BR><BR> </p><p>Agency sources said the new policy would result in media inflation of 10 </p><p>to 20 per cent, depending on the package an agency had previously </p><p>secured for its client. SMEG has proposed granting discounts only on </p><p>volume - after an advertiser's booking has reached a minimum level, </p><p>possibly from Rmb20 million upwards. It has also proposed chopping </p><p>credit terms from 60 to 30 days next year. </p><p><BR><BR> </p><p>However, not all agencies have been critical of the new policy. Derek </p><p>Kwok, general manager of Zenith, said the blanket policy would level the </p><p>playing field. "(Previously), if the advertiser is a friend of the media </p><p>owner, it would be given advantages." A SMEG spokesman said the company </p><p>unified the rate card as it valued smaller advertisers and believed the </p><p>policy would help it to attract more of them. </p><p><BR><BR> </p>