IPL digital rights expected to be hotly contested
Digital rights for the IPL are currently with Star India
Published - Sep 5, 2017 1:20 PM Updated: Sep 5, 2017 1:20 PM
The media rights for the Indian Premier League (IPL) go under the hammer today. A total of 14 companies have submitted bids for the rights, which include TV and digital broadcast in India and overseas.
Industry observers we spoke with said that digital rights in particular would be fiercely contested.
Digital rights for the IPL are currently with Star India, which paid around Rs 302 crore in 2015 for a period of three years.
The new digital rights encompass a period of 5 years, starting from 2018 through 2022.
BCCI is expected to make a windfall of around Rs 15,000 crore to Rs 20,000 crore for the various rights.
Digital streaming is a tricky business in India given the nascent nature of subscription revenue in the country. Digital broadcasters have to depend on advertising revenue to fuel operations.
For example one media planner told us that Star India would have made around Rs 70-80 crore in ad revenues last year on the back of IPL. When you consider that the cost of the rights come to around Rs 100 crore per annum, the question is whether it makes financial sense to the company.
However, analysts and industry observers stress that one cannot determine the value of IPL for broadcasters just on the basis of revenue.
"It (IPL) creates a huge sampling base for the company so it makes sense from a marketing point of view. There has also been a huge migration of cricket advertising monies to digital," opined Shekhar Banerjee, COO at Madison Media. He also pointed out that Star's digital platform Hotstar has seen a massive scale-up in traffic due to the IPL.
Thomas Abraham, Editorial Director at Sportz Network Ltd, also opined that IPL has been a driver for Star India's Hotstar.
"Digital is a new space so growth is higher. You have to look at all the other things they have built on the back of IPL before deciding on the value that they have derived from the IPL. On digital, if you are only talking about advertising, then you are missing the point," he said.
Highlighting the importance of the IPL digital rights, Abraham further added that this space would see the highest percentage increase due to higher number of bidders.
"The potential for irrational bidding will be in digital rights," he said, further adding that a consolidated value of around Rs 14,000 crore is a fair amount. "If we go by market estimates (of total value of media rights) of Rs 20,000 crore then I feel the excess Rs 6,000 cr would be because of irrational bidding for digital rights," he said.
24 companies had picked up the rights papers of which 14 have now submitted their bids for the various rights. These include, BeIn Sports, SuperSport, YuppTV, Times Internet, Gulf DTH, Facebook, Airtel, Star India, BAM Tech, Sony Pictures Network, Econet Media Group, Perform Group, Followon Interactive Media and Reliance Jio.
For more updates, be socially connected with us on
Notable absentees from the final bidder list include the likes of Amazon, Discovery and ESPN.
WhatsApp, Instagram, LinkedIn, Twitter, Facebook & Youtube