The Time Press
Opinion

Fight for IPL media rights set to escalate this year


Last week, Bob Chapek, chief executive officer (CEO), The Walt Disney Co., said his company was “certainly going to try to extend” its media rights on the Indian Premier League (IPL). However, he added that if Disney were “not to go ahead and win the auction,” it would still be able to achieve its global subscription target of 230-260 million users for Disney+ by 2024. (The streaming service is branded Disney+Hotstar in India and some other Asian markets).

Chapek’s comment indicated that Disney will fight tooth and nail to seize the IPL media rights. It also set the tone for an unprecedented fight in the upcoming IPL auction, with the possibility that others bidding more may win. Disney-Star held the complete media rights for the IPL for the last five years, purchased at 16,347.50 crore.

The sports broadcasting sector is currently rife with rumoured estimates of 35,000 crore that the IPL auction will fetch. Even networks are expecting the bids to spiral.

In an interview to Mint last month, K. Madhavan, president, The Walt Disney Co. India and Star India, hinted that the company will not go overboard in paying for the premium cricket property. “We will look at the business plan, we will consult. Beyond that, if it exceeds my business plan, my projections, we will see,” Madhavan said when asked if he would pay 35,000 crore for the IPL.

The addition of two new teams—Gujarat Titans and Lucknow Super Giants—will any way escalate the base price as the total number of matches to be played go up from the current 60 to close to 90.

“If you are starting from 22,000- 25,000 crore as the base price, it will not take more than a few minutes to touch 35,000 crore in the e-auction. The price could up to 40,000 crore,” said former Sony CEO Kunal Dasgupta, the first to buy IPL media rights 15 years ago. Dasgupta is the founder of Triple Com Media, a metaverse studio.

To maximize revenue, the Board of Control for Cricket in India (BCCI) is expected to unbundle the media rights this time; meaning, sell digital and TV rights separately since it’s a hot property.

Despite the prohibitive costs, the battle for IPL rights will be fierce. Disney-Star, Sony Pictures Networks India and Reliance Industries Ltd-led Viacom18 are expected to throw in their hats in the ring. Amazon Prime Video has not commented on the IPL, but has shown its interest in cricket by getting India territory rights to stream New Zealand cricket matches through 2025-26. Experts said new alliances could be forged for these rights as consortiums can bid too.

Why networks are after the prized property is easy to see. The IPL is the only property watched by the entire country. Content is fragmented into language segments in entertainment, but not in cricket. Cricket viewership cuts across language barriers.

Also, it offers live content for more than two months to any broadcaster which is a major plus to garner viewership on TV and streaming.

Dasgupta attributes the gap between total subscriber numbers for Disney’s streaming platform Hotstar (45 million) and other platforms like Netflix (5.5) to the IPL and other cricket properties. He expects millions to move out of Hotstar if cricket moves to another streaming platform.

Then there’s the network effect. Other channels in a broadcaster’s portfolio benefit via cross promotion of programming. Importantly, the media rights holder has sway on brands keen to advertise during the IPL matches. “You can tell media agencies and brands to commit spends on other channels if they want premium slots on the IPL where inventory is limited. The policy started by Sony apparently continues,” said Dasgupta.

Yet, the IPL rights don’t turn in profits. Companies with the rights break even at best. However, they bid based on calculations of what they can achieve in terms of advertising and distribution revenue. That calculation has possibly led to the 35,000 crore figure circulating “which may not be too excessive given that Indian economy is set to boom in the next five years,” Dasgupta said.

Madhavan, in his conversation with Mint earlier said: “When somebody invests billions of dollars in a particular sport, there’s a reason for that. You don’t have to create anything more in the IPL. The IPL is a global brand…it is a huge, huge property and everybody is interested.”

Subscribe to Mint Newsletters

* Enter a valid email

* Thank you for subscribing to our newsletter.

Never miss a story! Stay connected and informed with Mint.
Download
our App Now!!



Source link

Related posts

Leeway on the rupee

thetimepress

Why co-founder Rahul Bhatia took the cockpit at IndiGo

thetimepress

Balance, please

thetimepress

Leave a Comment