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Star India estimated to have earned Rs 1800-2000 crore ad revenue from IPL

30-May-2018
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Star India estimated to have earned Rs 1800-2000 crore ad revenue from IPL

From television commentary in six languages and airing the Indian Premiere League (IPL) finale on its Hindi GEC (Star Plus) and movie channel (Star Gold) to tailor-made feeds for different regions and 120 commentators on board, Star India played its cards well to keep both advertisers and audience interest alive throughout the one-and-a–half month-long cricketing extravaganza.

The strategy seems to have worked out well for Star and the network is estimated to have earned advertising revenue of Rs 1900-2000 crore in its first year, including Rs 300-350 crore from Hotstar, as against the previous year’s Rs 1300 crore revenue earned by Sony Pictures Network.

Star India spent a whopping Rs 16,347 crore to ink a five-year deal with BCCI for IPL.

The revenue figure of Rs 1900-2000 crore is what Sanjay Gupta, Managing Director, Star India, had mentioned in an interview with exchange4media last month. Gupta had said that the network was aiming at a turnover of Rs 2000 crore ad revenue from television and digital.  "This is approximately 60 per cent more than last year’s ad revenue," he had mentioned in the interview.

According to Dinesh Vyas, Vice President, PHD, Star India, the market estimate has been around Rs 1900-2000 crore (including digital) in the first leg of IPL that concluded with Chennai Super Kings taking home the trophy on May 27.
“Star India is extremely happy with the response," he said.

An industry source, who also speculates that the network has already earned approximately around Rs 2000 crore, said, “Since it was Star's first year, it will definitely pick up going forward."

Another industry veteran said Star made around Rs 1400-1500 crore in television ad revenue with additional Rs 250-275 crore on Hotstar, taking the total to Rs 1800 crore.

But there is no way to verify this figure, says a senior media planner who doesn’t wish to be quoted.

"When Sony made Rs 1300 crore they said ‘we made this much’ but there was no way to cross check it. The split is much more difficult this time as all the deals were made together. So it’s up to the broadcasters to do the allocation. The client (advertiser) also doesn't know the split," the planner said.

Hotstar’s Magical Number

Star India's video streaming service Hotstar set a new record on Sunday with more than 10 million concurrent viewers logging onto the platform to watch the final match. This has given huge hopes to the industry about its ROI, with some media planners even estimating that Hotstar made over Rs 400 crore.

Gopa Kumar, EVP at Isobar India, estimates that OTT platform Hotstar has raked in roughly Rs 300-350 crore in advertising revenue, which is around 40-60 per cent higher than the Rs 220 crore in the previous edition.

He mentioned that the earlier quotation of Rs 500 crore (given at the start of the IPL) was unlikely because most of the deals were sold in combined packages (TV and digital), which affected the monetisation capability of Hotstar.
“Majority of the big advertisers are sure to have gone for the bundled packages which attributed to lesser ad revenue for Hotstar," he said.

Shrenik Gandhi, CEO and Co Founder, White Rivers Media, also estimated a similar number of Rs 350 crore.
His explained, “For every additional percentage of viewers consuming content on the platform, it can result in 1.1%-1.2% jump in ad revenue. Additional viewers should be valued as gold as once they are on the platform because of a star property, they are more likely to flock around and explore more content, which shall result in better app stickiness and better ad revenues.”

“It is important to evaluate the revenue and viewership by repeat consumption and engagement on the app over at least two more quarters. If the signs for the same are positive, the property is a success. A one-off increment or a spike doesn’t guarantee long-term success. Having said that, given the parameters, it is safe to assume that the revenues would have seen at least a 51-55% jump over last year's Rs 220 crore,” Gandhi added.

However, another senior media planner, who didn’t wish to be named, was conservative with his estimates and quoted Rs 250-270 crore for Hotstar.

All said and done, these are estimated figures and we will follow it up as and when we get the exact numbers.

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