Has Star overstretched with Rs 16,347.50 cr bid? Why did Sony not make a global bid?

05 Sep,2017

 

By A Correspondent

 

Star India Chairman and CEO Uday Shankar is known to think big and take big risks in his broadcast business. Even his rivals concede that the former news journalist has given a new definition to scale.

But is a bid of Rs 16,347.5 crore for global television and digital rights for the Indian Premier League for 2018 to 2022 too big to chew. Has Star overstretched itself. Ever since the announcement was made on the afternoon of Monday, September 4, these are the questions that many mediapersons have been asking.

The Rs 16.3+kcr bid for 300 matches of the IPL would mean the need to recover Rs 54 crore match and this is a big, big ask, some of the naysayers have been saying. However, not everyone is in agreement with this fear. Said one observer: Cricket is a religion in this country and with the Indian diaspora across the world. Over the years, the format has got exciting, the players have improved, so the consumption of the sport has increased. And hence there will be takers to reach this growing community.

According to media agency professionals we spoke with, the rates for ad spots around the IPL will leapfrog. And so will the access rates via Hotstar, Star India’s digital platform. Their worry is whether advertisers will pay the extra dollar just because Star has to recover its monies.

According to Vinit Karnik, Business Head, ESP Properties at media agency network GroupM, Star India hasn’t overstretched itself on the bid. Karnik also observed that the recovery of the commitment by Star will be done in not just advertising revenues but also via digital which is going to grow rapidly in the next few years and via distribution.

 

 

“This is a historic moment for Indian sports industry as BCCI has demonstrated highest media rights sales in the history of world cricket. These media rights numbers are now comparable to the best of sports around the world. IPL once again proves to be the best sporting league that build exponential value for all stakeholders,” Karnik said in a statement.

Earlier, there were 14 bids were received, earlier in the morning from beIN IP Ltd., Star India Pvt. Ltd., Followon Interactive Media Pvt. Ltd, Sony Pictures Networks Pvt. Ltd., Times Internet Ltd, Supersport International (Pty) Ltd., Reliance Jio Digital Services Pvt. Ltd., Gulf DTH FZ LLC, Econet Media Ltd., Facebook Inc., DAZN / Perform Group, Yupp TV, Airtel and BAM Tech.

Said Uday Shankar, Chairman and CEO, Star India: ”We are honoured to be selected as IPL’s Global Media Rights Partner and we thank BCCI for conducting such a transparent process. The Vivo Indian Premier League is undoubtedly one of the most exciting sporting leagues in the world and this acquisition of media rights reaffirms our commitment to serve cricket fans and make cricket even bigger than it is. We are delighted that in Star, IPL has found its natural home. We look forward to bringing this exciting format to our audiences across the world in a quality that all our viewers are accustomed to both on television as well as on digital on Hotstar.”

Elaborating on Star India’s commitment to sports, Shankar added: “At Star India, we believe that Indian sports have barely scratched the surface of its potential. Both the viewership of sports and more importantly participation in sports is something that we would like to grow substantially over the next few years. The acquisition of these rights is symbolic of our commitment to not just cricket but to the growth of a wider sports culture in the country.”

Another question that has been raised by some A&M professionals is why Sony didn’t make a global bid after having made a fairly ambitious bid of Rs 11,050 crore for television rights alone. This some feel is an aberration from Sony’s aggression in the past.

A media agency professional said that while the loss of IPL rights is a significant loss for Sony Pictures Network, all is not lost yet for the network which has made sizeable investments in sports in the recent past. The India rights are scheduled to come well ahead of IPL 2018, and Sony will definitely make a huge bid for that, the professional who requested anonymity noted.

Perhaps. We’ll wait and watch. In the meantime, it’s sunny days ahead for Star India.

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