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How the World’s Top Ad Agencies Colluded to Fix Prices in India

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Internal communications revealed that major global advertising firms secretly coordinated to rig ad prices in India’s vast market, undermining competition and client choice.

In October 2023, Omnicom Media’s India CEO, Kartik Sharma, expressed frustration in a WhatsApp group after a rival agency attempted to poach a client by offering lower rates—violating an industry-wide agreement on pricing.

The WhatsApp group, formed in August 2023 and including top executives from WPP’s GroupM, Omnicom Media, IPG Mediabrands, Publicis, Havas Media, Japan’s Dentsu, and India’s Madison World, discussed coordinating pricing strategies and responses to clients. According to evidence reviewed by Reuters and obtained from India’s Competition Commission (CCI), the agencies agreed not to undercut each other, colluded with broadcasters to penalize non-compliant firms, and coordinated financial terms for at least four major Indian clients.

The cartel was facilitated by two industry bodies—the Advertising Agencies Association of India (AAAI) and the Indian Broadcasting & Digital Foundation (IBDF)—both led by senior executives from WPP Media India and Reliance-Disney respectively. The AAAI circulated guidelines requiring agencies to charge minimum commissions on digital and traditional ads and agreed with broadcasters not to offer unilateral discounts.

The CCI dossier revealed discussions about client pitches involving firms like Swiggy, Cipla, Meesho, and Kshema Insurance. For example, the AAAI arranged a Zoom call to unify the industry’s stance on rebates for Swiggy’s ad campaign. A Dentsu executive noted on WhatsApp that the agencies would retain 30% commission and pass back 70% to clients as rebates.

In August 2023, AAAI’s president urged broadcasters like Walt Disney to withhold business from agencies breaking the cartel agreements. Tensions rose when Omnicom Media learned that ITW Consulting had bypassed these pacts with a direct deal on Disney’s Hotstar streaming platform during the Cricket World Cup.

Despite these revelations, the foreign headquarters of the involved agencies have not confirmed awareness of the collusion. Dentsu India disclosed its involvement under the CCI’s leniency program aimed at reforming industry practices from within. Other agencies declined comment, and the regulator has yet to conclude its probe.

This investigation adds to ongoing scrutiny of ad agency practices globally, with similar probes underway in the U.S. following suspicions of anti-competitive behavior.

Samsung Challenges India’s Antitrust Probe, Citing Illegal Seizures

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Samsung Electronics has accused India’s Competition Commission (CCI) of unlawfully detaining its employees and seizing confidential data during a raid linked to an antitrust investigation involving Amazon and Flipkart, according to a legal filing. The case stems from a CCI probe that found Samsung and other smartphone companies colluded with the e-commerce giants to launch products exclusively online, breaching antitrust laws.

In an October 11 filing submitted to the High Court in Chandigarh, Samsung requested the quashing of CCI’s findings against it. The company argued that material seized during a 2022 raid at an Amazon vendor was obtained illegally. Samsung stated that three of its employees were detained during the raid, their phones confiscated, and confidential data copied without proper authority.

“The entire search exercise…is patently illegal, and any material collected thereunder should not be relied upon and should be promptly returned,” Samsung wrote in its 32-page petition. The filing also called for the CCI to be prohibited from using or relying on the unlawfully obtained data.

While Samsung secured an injunction from the High Court, temporarily halting the proceedings, the court has yet to decide on returning the seized data or barring the CCI from using it. The watchdog has faced similar injunctions from 22 other companies across India, prompting the CCI to seek a Supreme Court intervention to consolidate the challenges. The regulator claims the firms are attempting to derail its investigation.

The CCI probe centers on allegations that Amazon and Flipkart violated competition laws by favoring specific sellers on their platforms, disadvantaging competitors and brick-and-mortar retailers. Samsung, despite cooperating with the investigation as a third party, has been accused of enabling exclusivity in business practices by launching phones exclusively on Amazon and Flipkart. The watchdog labeled such practices as antithetical to free and fair competition.

Samsung, one of India’s leading smartphone makers with a 14% market share, denies any wrongdoing. The inclusion of smartphone manufacturers in the probe is expected to escalate legal and compliance risks for companies like Samsung.

The case underscores the growing tension between global tech firms and Indian regulators. Online sales have grown significantly in India, with 50% of phones sold online in 2022, compared to just 14.5% in 2013, according to Datum Intelligence. This shift has increased scrutiny on e-commerce platforms and their partnerships with tech firms.