They have a lot of media rights for the IPL, but this time there are more of them. It’s all about you, man.
In this year’s Indian Premier League (IPL), many big guns are competing to buy the rights to show the game.
Because Uday Shankar is a well-known expert on buying the rights to show cricket on TV in India, he has put his name in the ring this year. During this time, an estimate says that the rights to show IPL games on TV are worth about $6.6 billion. Shankar is making a comeback.
Shankar has teamed up with James Murdoch, the son of media mogul Rupert Murdoch, to buy a 39% stake in Viacom18. They plan to spend INR12,000 crore on entertainment and sports businesses. When someone makes a movie like this, everyone who wants to broadcast the IPL is a little scared.
So I don’t know what to do.
Uday Shankar is the person who made Hotstar. Shankar saw cricket as a big thing that could make a lot of money, significantly subscription revenue for OTT platforms. Shankar was the company’s CEO when he won the right to show Star India IPL’s media rights in 2017. There is a general view that if he comes back with a lot of ammo, he should be taken seriously. Whether or not the whole deal was profitable is another storey. Amazon, Sony, Star, and Viacom18 all want to get their hands on the Indian Premier League, which is the best thing in the world (IPL). But what?
Crowds only come to the best sweet shop.
IPL has, of course, grown a lot. IPL rights can make the Board of Control for Cricket in India (BCCI) a lot of money this time around, says Sourav Ganguly, the head of the board. Many experts think that the price will go up to INR50,000 crore because the board already made INR12,000 crore from the sale of IPL’s two new teams.
If someone wins the rights, will they get their money back? In what way?
It’s called “the golden goose.”
As it turns out, the crowd isn’t just gathering behind the screens; they are also gathering in front of them.
In 2017, 4.7 million people watched the IPL. In 2019, 18.6 million people watched the IPL. When there was a pandemic in 2020 and 2021, nine million people still cared.
Even more interesting is that Disney+Hotstar, Star India’s digital broadcaster for the IPL, saw advertising revenue grow by 35% in the last five years, while subscription revenue rose by 100% in the same time.
It’s getting many new people interested in the sale because subscription revenue is going up.
Many media companies have made a lot of money from the Indian Premier League (IPL) in the last five years, and Star India and Disney are two. Because of Star India’s massive success with the IPL, many big media companies are interested in getting the rights to show the IPL. This year in March, Star India’s five-year contract ends.
These are the big names with Disney Star Network, Sony Pictures Network India, and Viacom18 (the joint venture between CBS Inc and Reliance Industries Ltd). Amazon is also there.
What’s more interesting is that the BCCI has decided to sell the rights to the games online. It will be done within 45 days of the tender being put out.
People are more interested in the IPL now because of the e-auction and because more media companies want to cover it. This will be the first time that Star and Sony aren’t the only big players fighting for the IPL’s TV rights.
One of the main things that draw a lot of people is
Because of what they do, many people come to see them understand this, and we need to look back and see how the IPL has helped Star India grow.
The pandemic couldn’t even stand in the way of IPL’s speed.
The Indian Premier League, one of cricket’s biggest tournaments, has always brought in a lot of money for Star India. They want to get IPL’s broadcast rights to show their shows.
Star India paid INR16,347.50 crore for the media rights to the IPL in 2017. The broadcaster earned an ad sales revenue of about INR2,100 crore in 2019 over INR1,750 crore in 2018, which is a big difference.
In 2020, a pandemic led to a lockdown that forced the tournament to be postponed. Later, the match was moved to the United Arab Emirates (UAE). There was a lot of anticipation on whether Star India will reach its target of INR3,000 crore revenue (from the combined television and digital advertisement and sponsorship sales) (from the connected television and digital advertisement and sponsorship sales).
Despite delays and postponement, IPL’s craze continued, and TV ad rates for a 10-second slot zoomed up to around INR15 lakh from INR12 lakh in 2019 and INR10 lakh in 2018.
While the broadcaster couldn’t achieve its initial target of INR3,000 crore, it did manage to generate INR2,800 crore of advertising revenue for Star India from both television and Hotstar combined, as per industry experts.
IPL spent INR2,950 crore on TV ads in 2021, according to reports, and that’s a lot of money.
When a pandemic led to a lockdown, it changed the game. People thought there might not be as many advertisers interested in the tournament because it was put back. But the IPL has been a massive hit with viewers. 2020 was a good year for the game, which led to more people wanting to see it in 2021, an expert says.
Viewership is a promise.
If IPL can be sure of one thing, people will watch. They say that too.
On the IPL’s 2019 finale, Star India saw a 23% rise in viewers, with an average of 31.57 million impressions.
Broadcast Audience Research Council (BARC) India says that IPL 2020 had 7 billion viewing minutes for the first 41 matches shown on 21 channels in the last five weeks (week 38-42). This is 28% more than IPL 2019, which had 5.5 billion viewing minutes for 44 matches that were shown on 24 channels.
Despite the tournament moving to the United Arab Emirates, it didn’t affect the number of people who watched, as it kept going up.
Data shows that the performance per match of the IPL 2020 season was better than the last season. There were 108 million people who saw IPL 2020’s 41 games throughout the season, 11% more than in 2019.
The previous season had a total reach of 98 million people. In 2021, the tournament was split into two parts, which made it hard for people to watch.
But a deeper look shows that there is more interest.
People who watched the first 29 matches of the IPL 2021 were able to see 188 billion minutes of total time, which is 14% more than in 2019. Star had a reach of 367 million people.
It took 255.4 billion minutes to watch 45 games in the IPL 2021 so far, compared to 248.4 billion minutes in 2019 for the same number of games.
The strength of a contract.
Sports, especially cricket, have played a significant role in the rising demand for Disney+Hotstar.
One could say that Hotstar is at the top of the list of OTTs because of cricket, especially the IPL. During the 2019 IPL, Hotstar had more than 300 million unique visitors and more than 74% more time spent watching.
A report by BARC India says that Disney+Hotstar had about 150 million active users and more than 350 million downloads before the outbreak of Covid-19, but that was before the explosion.
There were over 400 million and over 300 million people in the world as of May 2020.
Almost 18 million people signed up for Disney+Hotstar in September 2020. Following the IPL, which ran from September to November 2020, the video-streaming platform gained about 7.5 million paid users.
As a result of the pandemic, the number of people who watched in 2020 dropped. In 2020, 8.7 million concurrent viewers watched Disney+Hotstar at the same time.
In 2021, the pandemic made the IPL even less famous. The tournament was split into two parts because so many people were sick. The platform had 5.7 million to 6.7 million people watch these two parts.
An expert in the field says that the ability to charge a lot more for advertising and subscriptions because of the IPL draws broadcasters.
Many people watch TV when there are a lot of IPL games. During those months, if there is only one TV in a home, which is usually the case in India, and that TV is watching the IPL, then the ratings of other channels drop, and advertisers see that drop, too. Digital broadcasters can’t guarantee that their shows will be seen because there are a lot of different digital platforms, like YouTube and Facebook; advertisers can use that. HE SAYS with TV, and broadcasters can justify charging more for IPL.
Calculation of the value
The BCCI has decided to sell the rights to the game online. To make things even better, bids for the IPL will be placed in real-time, which will raise its value.
According to the expert who said this, when the bidding starts, the bidders will be figuring out the numbers in real-time.
Auction is something that no one wants because it causes prices to go up, so no one likes it. Many people want to buy the property, so the auction will automatically get bigger. You can see how much your bid is worth or how high it is at every step of a live auction. That artificially makes people want to keep bidding higher and higher, which, in the long run, makes things more valuable and causes inflation, he says.
We saw this happen in 2018 when the BCCI held an e-auction for its bilateral rights to play games. Star India paid close to a billion dollars to fight Sony Pictures and other companies.
It’s thought that the base price for the IPL will be a lot more than it is now because the value of the IPL is around INR45,000 crore.
This means that in 2020, Duff & Phelps says that the IPL ecosystem’s value has dropped 3.6% to INR45,800 crore from INR47,500 crore in 2019.
It is still a lot more than other cricket properties. As a result, the number of teams and games in the IPL is going up, making a big difference.
“The IPL has become a big money-making business.” New teams were added, and the units were sold for a price that was way too high. Everyone has been very excited about the IPL. I think the IPL in cricket has become a well-known brand in India and draws the best players in the world to play for them. So, the value has gone up, says the expert.
Separating digital and TV shows
Analysts say that there is a chance that BCCI could sell the digital, TV, and international media rights to the game on their own.
According to experts in the field, many companies could compete for the right to show a particular piece of media. What if we follow Ganguly’s advice? The base price of the bid might start at INR35,000 crore, which is a considerable jump in itself. Today, I don’t think one company can bid that much on its own.
In this case, Amazon will be pleased because it has been trying to get into sports. If digital and TV rights are split, Amazon will be a good thing. Many people in India still like to watch content for free, even though many people now pay for it. As a result, the subscription revenue is still a tiny part of the business, so it doesn’t change much.
A lot of Amazon’s business comes from online sales. Now, if Amazon wins the rights to IPL’s digital media, not only will it be able to grow its subscriber base, but it will also be able to get more advertisers to work with them, too.
People who use Amazon are more than just making money from the IPL ads they put on their site. There is a bigger game. Amazon is a place where people can buy and sell things. It has a lot of information about Indians who shop on the web, and it can use that data to make groups of people more likely to buy IPL ads. Today, Amazon has about 120 million to 130 million people who use it every month. It can cross-sell products to these users and the new users who will come through IPL with the help of targeted ads.
Amazon getting all of the rights to the IPL is terrible for them because the IPL won’t be able to reach as many people on TV. Most people in India still get their entertainment from TV. So, if the IPL isn’t on TV, it will lose a lot of viewers.
So, it makes sense for the BCCI to split up the media rights with other groups of people.
The sports analyst thinks that the segregation of rights might not happen because there are many people with a lot of money who want to buy all of the media rights together. There is a good chance that Amazon could be outbid if that happens.
People at The Walt Disney Co India and Star India told The Economic Times recently that they are optimistic about renewing their sports rights. This is because they want to keep making money.
The Sony-Zee group is also running for the property, and they might go all out in the bidding war. Then there is Viacom18, which wants to make a good sports network.
The news that media executives James Murdoch and Uday Shankar bought a 39% stake in Viacom18 can help them get IPL rights even more. Shankar’s help will be even better because he has already played this game.
It’s time to talk about the future,
The sports analyst quoted above says that more games may make people tired, hurting the IPL’s popularity.
There were more matches last time, and the ratings went down when there were more matches. The afternoon games, as they are, don’t get as many viewers. The number of games has gone up, which means more games will be played in the afternoon. The analyst says that if the tournament is too long, the viewers will get tired of it.
If one media company wins the right to show the IPL, it won’t be the end of the world. There are a lot of other places where you can buy crickets, as well.
In 2018, Star India, which Disney owns, bought the rights to all three of the properties: the IPL, the BCCI, and the ICC. This was a one-of-a-kind deal because Star India owns all three.
ICC media rights will be sold in 2023, and global broadcasters can’t invest so much money in more than one place at today’s prices.
edited and proofread by nikita sharma