Reliable sources within the bidding echelons of the Indian Premier League are revealing information at regular intervals to keep the public at large updated on the goings on within the e-bidding process that is currently underway.
BCCI officials too are fanning the fires via news wires.
Lalit Modi, seen as a founder of the tournament that today claims to be taking on the Premier League in terms of scale, is making his own projections from wherever he is. The projections are indeed dizzying.
The combined per match value of Rs.54.5 crore for broadcast and digital rights for the 2018-2022 period, was a steep climb that Disney Star is credited with. From Rs.8,200 crore for which Sony Pictures Network bagged broadcast rights in 2008-2017, Disney Star doubled the stakes to Rs.16,348 crore for broadcast and digital combined.
Disney Star made the investment count. We have seen startup and established brands invest in TV advertising on IPL that has delivered reach like nothing else. On digital, an Elara Capital report states that 70pc of Disney Star’s AVOD revenue is IPL-led.
The current numbers in the bidding war are reported to be at Rs.43,050 crore (broadcast and digital combined), at Rs.57 cr per match for broadcast and digital at Rs.48 cr per match. This is at the end of day one of the process, with bidding set to continue Monday.
To put things in context, the base price set by the BCCI was Rs.49 cr per match for broadcast and Rs.33 cr per match for digital.
With the drop in audience numbers in the 2022 edition, there are question marks on the cost per TV spot that will be viable. At the current subscription cost numbers, it is also unclear how the digital media rights holders will be able to justify the returns.
A lot of the startup valuations that have plummeted after initial fanfare are attributed to misreading or over-projecting the size of the addressable market. The IPL media rights could be another such case, except that there is a lot of uncertainty about what the Indian consumer might pay. Disney+ Hotstar showed us that the Indian consumer will pay to watch cricket on a device in his/her pocket. The question is, how much? The truth is, the consumer is still evolving and opening up one OTT show at a time.
While an old-school advertiser may not be sure of the RoI on a Rs.50 lakh 10-second spot (exceptions include those in investment mode backed by infinite funding), millions of subscribers may be willing to pay an additional Rs.100 each to watch their daily dose of cricket.
The digital rights at the current numbers may make sense for a new player to establish dominance, while seeing the media rights fee as an investment in the future.
