MUMBAI: Five years after the Indian Premier League (IPL) last raised big-bucks and escalated from being cricket’s most prized property to becoming one of the world’s hottest sporting leagues, it is time for T20’s greatest road show to stamp its authority once again.
The much-awaited media rights tender to grab the broadcast rights of the league will come out in the second week of February – tentatively between 10th and 12th. The BCCI has decided to go ahead with an e-auction and “transparency”, says the cricket board, will once again remain the keyword in the entire process.
The BCCI is not under any legal obligation to call for an e-auction. In 2017, when the Supreme Court heard a Public Interest Litigation (PIL) – filed by Rajya Sabha MP Subramanian Swamy – calling for all auctions to be held via a digital process, it did not pass an order to make such a process mandatory. Instead, the decision was left to the BCCI.
“The cricket board, however, would like to take all measures to make the process as transparent as possible. Not just that, the e-auction will in fact allow the BCCI to derive optimum value out of the tender process,” say those in the know of details.
The rights will once again be sold for a period of five years. The last time it happened in September 2017, via a closed-bid process, the IPL saw Star India (now Disney) submit a consolidated bid of Rs 16,347 cr (approx. US$2.3b) and grab it all.
Back then, the rights were bucketed into the following categories: A) TV – subcontinent, B) TV – global, C) Digital, D) A combination of two or more.
The global bid further had an assortment of territories worldwide. The winning bid that September afternoon was a 158% increase in overall value if compared to IPL’s media rights deal between BCCI, Sony, and World Sports Group (WSG) back in 2008-09.
How big will the pie grow this time, and how will the rights package be bucketed, is the question the industry is asking right now.
The first part of the question can be looked at only once the second part of the question is elaborately dealt with – how will the rights package get bucketed?
The answer lies in the benefit of hindsight. In 2017, when social media giant Facebook submitted an individual bid of Rs 3,900 crore for digital rights alone, it was said to have sent shivers down the industry. “Where is this digital space headed?” executives asked. To put things in perspective, when BCCI had first sold the rights to IPL in 2008 at around US$928m, the digital pie in the deal was less than five percent. By 2017, that pie – as Facebook’s bid showed – had grown by 25%, almost 4.5 times the previous deal.
The story goes that it was the Facebook deal that made media mogul Rupert Murdoch make up his mind on selling Fox and venturing out of the digital space.
In 2017, digital was looked at as a separate rights package meant for online consumption of all cricket content, IPL in this case. Five years later, the online consumption we speak of has further diversified into segments where each has a calling of its own.
Between 2017 and now, what are the digital trends that we have seen?
* OTT subscriptions began eating into the television space.
* The pandemic quickened the pace at which OTT has grown.
* The ability to customize content for viewers has been a huge shot-in-the-arm for digital.
* Appointment-viewing has gotten restricted only to live sporting action (from a linear standpoint), allowing digital to package content better.
* 4G is giving way to a 5G rollout next year and will coincide with the start of the new rights cycle.
* E-commerce has aided digital growth and e-retail and telecom players will eye this space with greater focus.
* The future of segments such as ‘addressable TV’, defining the space for ‘Smart TV’ to understand the intricacies of fixed versus movable platforms, platforms surveying augmented reality and a devoted platform for the ‘geek’s cricket’, is already upon us.
The factors above, and the rapid pace at which technology is changing, makes bucketing of rights that bit more complicated.
“In fact, there was a discussion, very early on, if the (IPL) rights cycle should be reduced from five-years to three. The reason to deliberate on it was – the pace at which technology is changing, does it make sense to keep the rights blocked for five years? But what helped BCCI make the decision was that it is important to give the investor the time required to settle down and earn from that investment. Only then will the BCCI derive the kind of value it must,” say industry executives tracking developments.
Now, five years later, Facebook is unlikely to be in the race anymore, and yet again, the industry is busy predicting another 25 to 30% hike in the digital rights value. If this prediction turns true – and we’ll keep coming to this later – IPL’s digital rights value alone could fetch anywhere between a mind-numbing Rs 16 to 20,000 crore.
Let’s leave the numbers, and the industry players who’ll be crunching it, for another day though.
The much-awaited media rights tender to grab the broadcast rights of the league will come out in the second week of February – tentatively between 10th and 12th. The BCCI has decided to go ahead with an e-auction and “transparency”, says the cricket board, will once again remain the keyword in the entire process.
The BCCI is not under any legal obligation to call for an e-auction. In 2017, when the Supreme Court heard a Public Interest Litigation (PIL) – filed by Rajya Sabha MP Subramanian Swamy – calling for all auctions to be held via a digital process, it did not pass an order to make such a process mandatory. Instead, the decision was left to the BCCI.
“The cricket board, however, would like to take all measures to make the process as transparent as possible. Not just that, the e-auction will in fact allow the BCCI to derive optimum value out of the tender process,” say those in the know of details.
The rights will once again be sold for a period of five years. The last time it happened in September 2017, via a closed-bid process, the IPL saw Star India (now Disney) submit a consolidated bid of Rs 16,347 cr (approx. US$2.3b) and grab it all.
Back then, the rights were bucketed into the following categories: A) TV – subcontinent, B) TV – global, C) Digital, D) A combination of two or more.
The global bid further had an assortment of territories worldwide. The winning bid that September afternoon was a 158% increase in overall value if compared to IPL’s media rights deal between BCCI, Sony, and World Sports Group (WSG) back in 2008-09.
How big will the pie grow this time, and how will the rights package be bucketed, is the question the industry is asking right now.
The first part of the question can be looked at only once the second part of the question is elaborately dealt with – how will the rights package get bucketed?
The answer lies in the benefit of hindsight. In 2017, when social media giant Facebook submitted an individual bid of Rs 3,900 crore for digital rights alone, it was said to have sent shivers down the industry. “Where is this digital space headed?” executives asked. To put things in perspective, when BCCI had first sold the rights to IPL in 2008 at around US$928m, the digital pie in the deal was less than five percent. By 2017, that pie – as Facebook’s bid showed – had grown by 25%, almost 4.5 times the previous deal.
The story goes that it was the Facebook deal that made media mogul Rupert Murdoch make up his mind on selling Fox and venturing out of the digital space.
In 2017, digital was looked at as a separate rights package meant for online consumption of all cricket content, IPL in this case. Five years later, the online consumption we speak of has further diversified into segments where each has a calling of its own.
Between 2017 and now, what are the digital trends that we have seen?
* OTT subscriptions began eating into the television space.
* The pandemic quickened the pace at which OTT has grown.
* The ability to customize content for viewers has been a huge shot-in-the-arm for digital.
* Appointment-viewing has gotten restricted only to live sporting action (from a linear standpoint), allowing digital to package content better.
* 4G is giving way to a 5G rollout next year and will coincide with the start of the new rights cycle.
* E-commerce has aided digital growth and e-retail and telecom players will eye this space with greater focus.
* The future of segments such as ‘addressable TV’, defining the space for ‘Smart TV’ to understand the intricacies of fixed versus movable platforms, platforms surveying augmented reality and a devoted platform for the ‘geek’s cricket’, is already upon us.
The factors above, and the rapid pace at which technology is changing, makes bucketing of rights that bit more complicated.
“In fact, there was a discussion, very early on, if the (IPL) rights cycle should be reduced from five-years to three. The reason to deliberate on it was – the pace at which technology is changing, does it make sense to keep the rights blocked for five years? But what helped BCCI make the decision was that it is important to give the investor the time required to settle down and earn from that investment. Only then will the BCCI derive the kind of value it must,” say industry executives tracking developments.
Now, five years later, Facebook is unlikely to be in the race anymore, and yet again, the industry is busy predicting another 25 to 30% hike in the digital rights value. If this prediction turns true – and we’ll keep coming to this later – IPL’s digital rights value alone could fetch anywhere between a mind-numbing Rs 16 to 20,000 crore.
Let’s leave the numbers, and the industry players who’ll be crunching it, for another day though.