As team owners raise issues, Mashal Sports clarifies on PKL media rights auction

Team owners have reportedly alleged that the auction has failed to achieve its objective since the idea behind holding the first-ever e-auction of PKL media rights was price discovery

e4m by Javed Farooqui
Updated: Apr 20, 2021 11:15 AM
PKL

The recently concluded auction process for awarding Pro Kabaddi League (PKL) media rights, it seems, hasn't turned out the way the stakeholders had wanted it to be. Team owners have reportedly alleged that the auction has failed to achieve its objective since the idea behind holding the first-ever e-auction of PKL media rights was price discovery. Following the allegations, Mashal Sports, the organiser of the auction, has now issued a clarification, terming the charges as baseless and contrived.

The franchises, who were hoping for a competitive bidding process with participation from leading TV and digital players, are reportedly not pleased as Star India, which also owns a 74 per cent stake in PKL organiser Mashal Sports, emerged as the only eligible bidder for the rights. Other media companies either didn't participate in the auction or were not eligible to bid for the rights due to stiff conditions in the tender document.

With no other bidder in the fray, Star India walked away with the rights for a reported sum of Rs 905 crore just Rs 5 crore more than the base price of Rs 900 crore.

According to an industry source, the PKL media rights tender required potential bidders to have sports broadcasting experience. Additionally, there is a mandate to telecast PKL matches in four languages - English, Hindi plus two regional languages. The source noted that these clauses favoured the incumbent broadcaster as they have sports broadcasting experience as well as multiple regional sports channels.

A Mashal Sports spokesperson, however, denied the charges terming them as baseless and contrived. "In addition to value, it is incumbent on Mashal to ensure that rights are awarded to an established entity with a track record in the interest of viewership, quality, and the sport. This is not unlike other serious sports in India and across the world. Accordingly, the packages were broken up into - television, digital, gaming, and a consolidated package – with each package carrying a relevant experience requirement."

The spokesperson further stated that the requirement for a broadcaster was only in television and consolidated packages and not so for digital/OTT and gaming rights packages. "Further, the tender allowed various flexibilities like the ability to form consortiums or choose packages to bid for. The requirement to have regional language feeds was a forward-looking requirement to ensure that the core language markets for the sport continue to be catered to. Let’s not forget PKL is the second most viewed sports league in India. In our assessment, none of these terms prevented any serious pan-India broadcaster from qualifying for the bid."

The spokesperson said that several bidders had purchased the Invitation to Tender document, however, only one bidder chose to participate in the online auction. "Star India was the successful bidder for the consolidated rights package. The average annual value bid by Star for Seasons 8-12 was nearly double of last season's rights fee," the spokesperson added.

Upset over the manner in which the PKL media rights auction was conducted, U Mumba owner Ronnie Screwvala has reportedly threatened to walk out of PKL by selling the franchise. He is also reported to have stated that the tender process was biased to favour broadcasters with tech and new-age companies not even qualifying to enter the bid.

“The erstwhile high fee earning consultants involved need a standing ovation for running the most successful auction ever where NO bidder (other than the owner of the league) turned up for the second most popular sport in India. But who will hold anyone accountable? It's disappointing that by selling off a great Indian sport to a global media company the true potential has been capped forever. League owner Mashal remains totally conflicted by its ownership and even failed to timely disclose complaint letters received by potential bidders that the tender process was biased to favour broadcasters and eliminating all tech and new-age companies to even enter a bid. On a lighter note - If I get sued for my above comments I’d be happy to lay bare the origin of conflict and nepotism,” Screwvala told ET.

Patna Pirates owner Rajesh Shah also reportedly lamented the fact that price discovery has not happened. “Kabaddi is a very popular and important Indian sport. Star played a big role in popularising it on television for these last seven years, as have all the stakeholders – the team owners and everyone associated with kabaddi. I believe the real value of the media rights could have been much higher,” he told Sportstar.

“It is unusual that a sports league is owned by a broadcaster, which has helped up to now, but if we are to realise the true potential of kabaddi, then fresh money and fresh players coming in across various channels can help. I believe they (other potential bidders) did not participate, even though many were very interested, because they must have felt, rightly or wrongly, that they may be disadvantaged with the league owned by another broadcaster,” he was quoted as saying by Sportstar.

On the issue of price discovery, the spokesperson said that the reserve price of Rs 900 crore was set in consultation with all stakeholders including the franchisees. "There were multiple bidders who bought the ITT and also participated in the clarification and training stages. We all know PKL is the second most viewed sport in India and we too would have loved to see more participation. But we are glad that the auction has been successful and there is clarity for the next 5 years. We are now excited to bring back PKL Season 8 for our fans."

Mashal said that the franchises stand to gain from the new media rights deal. "With the new deal, franchisee revenues from media rights will nearly double, on an average over the next five years. This should benefit their business model and work favourably for franchise economics," the spokesperson stated.

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