Bhubaneswar: The Bhubaneswar Municipal Corporation (BMC) is reportedly set to lose around Rs 10 crore in terms of ad space revenue as agencies have expressed their inability to pay the rental owing to Covid-19 pandemic.
The civic authority, which owns the rights to put up advertisements on government land, earns a major share of its annual revenue from advertisement licence fee for placing advertisements on hoardings and billboards on private land too. However, with little or no revenue since March, requests of cancelling rent have poured in from the parties.
“We are looking ahead of about Rs 8-10 crore rebate for agencies. Normally, we earn Rs 16-18 crore through renting ad space. This constitutes about 15 per cent of the BMC revenue. However, looking at the losses incurred during pandemic, we are still in talks for the future course of action,” said BMC Deputy Commissioner Srimanta Mishra.
The state capital has about 760 hoardings rented to about 20 agencies. Out of these, about 600 are owned by BMC itself. With a minimum charge of Rs 180 per sq ft, the civic authority is also said to charge the highest rates in comparison with other cities in the state.
“The lockdowns forced people to stay indoors. There was no presence of passengers at bus stands, railway stations and airports. As a result, most corporate houses and small business organisations had slashed funds for advertising campaigns. Consequently, there was almost 95 per cent drop in hoarding displays across the state,” said Sujit Sahoo, president of Outdoor Advertising Agencies Association of Odisha (OAAAO).
Sujit also stated that only 100 outdoor advertising properties out of the total 16,500 across Odisha were booked during the lockdown. Although revenue has started trickling in with gradual lifting of restrictions, the agencies have requested the BMC to waive advertising fee at least for the lockdown as salaries to employees and other rents are still pending.
Meanwhile, sources have said that if the concessions are to be placed, the civic authority will be looking ahead for one of the biggest losses in its annual revenue. The BMC, which had auctioned Rs 19 crore advertisement rights to two parties in February this year, will still lag in earning profits from advertisement owing to pandemic.
