IPL media rights auction are now worth more than Rs. 42,000 crore for the 2023-2027 cycle, and that value is projected to rise even further, according to recent sources. As of 2017, Star India paid roughly three times the amount.
June 13, is the last day to bid for IPL media rights. The bidding process for Package C and D -.worldwide– television rights as well as non-exclusive rights – will continue on June 14th. In addition, it will be revealed who obtained the rights to certain packages at this time.
A whopping Rs 44,075 crore was paid for the BCCI’s IPL TV and internet rights throughout the Indian subcontinent, making one of the wealthiest sporting organisations in the world.
Concept of IPL Media Rights :
The auction of IPL media rights took place as planned.
“Viacom18 has secured the internet rights to the IPL, while Star has secured the Indian TV rights for the next five years. Only Indian TV and internet rights contribute 107.5 crore to the total value of each game. These offers remove the IPL broadcast monopoly of one company “Under the condition of anonymity, a senior BCCI official told PTI.
There would be far more than 50,000 crores taken by BCCI. The BCCI received a payment of 16,347 crore from Star in 2017.
Due to the high original price for IPL media rights (Rs. 32,890 crore), the BCCI was projected to get at least twice the money this season. Between 35,000 to 40,000 crore and up to 50,000 crore were expected as the winning bids in the auction, according to certain analysts.
More than 50,000 crore is expected to be earned by the BCCI after the sale of Television and digital rights for a total price of 44,075 crore (almost thrice the amount Star paid in 2017).
There is no official word on who won the TV and digital rights battles.
No official confirmation has been made yet that Sony and Viacom18 have been sold the Television (Indian Subcontinent) rights as well as the internet rights, respectively.
On Wednesday, June 13 is expected to see the sale of two more rights.
An estimated $1,110 million will be spent over five years for the worldwide television rights to each game. Winner of the non-exclusive rights bidding would be allocated 18 games (four playoff rounds) at a minimum bid of 16 crore per game. Thus, the overall cost of the deal will be a whopping 1,440 crore. As soon as the bidding for such two packages begins, we may expect it to expire on June 13th.
Popularity of Cricket :
In the past decade India has become the financing hub for cricket, a broadcaster in its own right, and an agenda-setter in the management of all forms of the game.
What some commentators have called the ‘Indianization’ of cricket extends beyond business: it is a social, political, and cultural phenomenon.
For five seasons, the Indian Premier League (IPL) has offered a glimpse of this phenomenon, prompting enthusiasm from young fans and those who stand to profit from the new league, and resistance from traditionalists. The material and symbolic roles the IPL has come to play in global cricket.
It begins with an overview of the IPL’s history, discusses how the IPL is changing the global business of cricket, and explores how the IPL is challenging the traditional culture of the sport. With arguments about the IPL as a grand spectacle, and a cultural phenomenon that, despite its problems, might prove its critics wrong.
IPL as a useful case study not only in the business of sports, but also more widely in our theoretical and empirical studies of globalization.
Sport is the greatest form of reality TV. Its a popular form of entertainment in India like Bollywood movies. The broadcasting spectrum has developed itself as the most dominating factor in income from IP’s, overtaking the likes of Sponsorships and Gate revenues.
This factor also serves as a testimony to where the entire game is heading towards i.e. the television and social media platforms. Take for example Hotstar, Star India’s online content delivery platform Hotstar’s viewership base expanded from 41 million at the end of IPL 2015 season to 100 million during IPL 2016 season.
Sports broadcasting represent the highest growth rate when compared to the likes of merchandising and sponsorships as an initial round of deal making accelerates for new inventory related to digital media platforms, uniform rights, and incremental in-venue signage and naming rights opportunities.
The North American sports market is already witnessing a surge when it comes to revenue derived from media and the projections suggest that this growth in sports media is here to stay with new avenues for investments in the form of digital media, virtual and augmented reality.
While concepts like virtual and augmented reality might seem a thing of the future when it comes to Indian markets, there is definitely a lot of potential as *PWC Sports Outlook 2017 *Commercial trends in sports 2017 franchises seek new means of fan engagement initiatives.
Over-the-top live content is coming to sport, with established broadcasters, newer digital publishers, rights holders, telecoms firms, social media platforms and technology giants all engaged in some form.
Amazon, Google and Apple are all active in content creation and delivery, while rights holders are actively developing and experimenting with their own media models – PGA Tour Live, the Olympic Channel and Dugout, the collaboration between 30 major football clubs are all examples.
These rights holder-owned channels can also generate data giving a richer, deeper picture of the audience and opening up new potential revenue streams around merchandise, ticket and content.
The sale of broadcasting and media rights has become a key income stream in the business of sport. The sector has benefitted in multiple ways from the huge injection of financial resources derived from the sale of these rights.
Such is the importance of broadcast revenue that some sports have sought to attract broadcasters and viewers by adapting their rules. For example, volleyball has adopted a new scoring system that makes it easier to predict the duration of matches.
Similarly, the tie break was introduced in tennis matches, along with yellow tennis balls to make it easier for viewers to follow matches on television. The critical importance of broadcasting rights as a means of funding major sporting events is most evident with respect to top-tier global sports events.
From 2009 to 2012, Olympic broadcasting revenue amounted to $3.914billion. In fact $3.914 billion is a humongous figure considering the development of media rights in Olympics right from when it was broadcasted in Rome in 1960.
The annual TVSM Global Report – 2017 by Sport Business Group has pegged the Global Sports Media Rights Market sales at $47 billion.
Popularity of IPL (Indian Premier League) :
Since its arrival in 2008 the IPL has attracted a large fan base, both in India and, because of its sale of broadcast rights, in international markets. During its first five seasons, the IPL has established itself as a major source of revenue for the BCCI, the ICC, merchandisers, advertisers, owners, bookies, and players.
In several ways, the IPL has brought changes to the global business of cricket. Perhaps most obviously, the success of the IPL has strengthened the international position of the BCCI.
In 2005 the BCCI surpassed the England and Wales Cricket Board as the richest national body in the sport; since then, it has widened the gap, and now commanded substantially higher revenues than did any other national body.
The BCCI represents a population seven times larger than that of the second most populous Test nation (Pakistan). It also represents the country where upwards of 70% of global cricket revenue is now spent. Much of the BCCI’s new clout goes beyond the game of cricket. Its ascension is also the result of wider economic trends.
India is still some distance from surpassing the United Kingdom (UK) as the largest economy (in nominal terms) among Test-playing nations, but its growth rate remains higher than that of the UK, and its population is growing much more rapidly.
The growing fortunes of the BCCI, coupled with the economic rise of India itself, have emboldened India’s cricket administrators. In recent years, other national bodies have complained that the BCCI has pressured them to adjust their domestic and international playing calendars for the benefit of the IPL.
Flush with cash, the BCCI now plays a powerful – and increasingly public – role in the management of the game. In the eyes of some, it has graduated from financier to playground bully.
In addition to strengthening the BCCI, the IPL has also brought in a new form of cricket management: privately owned, big-money professional clubs.
In this respect, the IPL is an outlier: in their domestic leagues, the world’s cricket-playing countries utilize county or state teams, which tend to have limited fan bases, minimal merchandising, and little media coverage outside their respective annual championship tournaments.
From the West Indies to England to Australia, national cricket bodies suffer from what has been described as an ‘inverted pyramid’ of financing, wherein they must use profits from international matches to make ends meet at the domestic level.
For many traditionalists, part of the appeal of such leagues is their un-commercial nature: they cater to fans who appreciate the rituals of multi-day matches, and continue an amateur playing tradition that dates back to the mid-19th century.
During the initial years of the IPL, some observers expressed fear that the IPL would weaken, or possibly even doom, the Ranji trophy, India’s national first-class championship.
That has not happened. Rather, the IPL has existed in parallel with the Ranji trophy, and scheduled its playing season several months after the end of the firstclass cricket season in India.
Contrary to pessimists’ predictions, India now has multiple domestic leagues, each serving a different audience, and each based on a particular political economy and philosophy of cricket.
The franchise model of the IPL combines elements of the English Premier League and English county cricket. The Premier League enjoys lucrative broadcast deals, a large following in England, and networks of fans spanning the globe.
While it may be slightly over-ambitious to compare itself to association football, the IPL has, in its own way, equipped its franchises for global reach. Part of this effort has involved the IPL’s conscious shaping of the league’s identity.
Like some English county cricket teams, IPL franchises are cosmopolitan, with players drawn from different cricket playing countries. But unlike county cricket, the IPL is not rooted in a long history. It is an upstart league that has embraced an Indian globalism from its inception.
The IPL is unique in bringing (most of) the world’s best cricketers together in a single short playing season, for a tournament not decided on national lines.
Only the 50-over ICC World Cup exceeds the IPL for concentration of cricketing talent in a single place, and that tournament is held every four years.
The IPL is an annual spectacle that lasts approximately as long (seven weeks) as the World Cup, follows a predictable schedule (round-robins commencing in early April; a final match the last Sunday in May), and fits broadcasters’ schedules due to the short length of the matches.
In the six years since the arrival of the Indian Premier League (IPL), the global business of cricket has shifted eastward.
Formally, the sport of cricket has been administered from Dubai since the International Cricket Council (ICC) moved its headquarters from London in 2005. Informally, cricket is governed by forces farther east.
In the past decade India has become the financing hub for cricket, a broadcaster in its own right, and an agenda-setter in the game’s global management. What some commentators have called the ‘Indianization’ of cricket extends beyond business.
It is a social, political, and cultural phenomenon. The material and symbolic roles the IPL has come to play in global cricket. It begins with a brief overview of the IPL’s history, then discusses how the IPL is changing the business of cricket and, finally, explores how the IPL is changing the culture of the sport.
With arguments about the IPL as a grand spectacle that challenges our traditional ideas of the game, and a cultural phenomenon that, despite its problems, might prove its critics wrong.
The Rapid Rise of the IPL Like the game of cricket itself, Twenty20 is an English invention. In 2003, after years of dwindling attendance at its county matches, the England and Wales Cricket Board (ECB) adopted a radical new idea.
In the middle of the county cricket season teams would take a break from first-class matches (lasting three to five days in duration) and play a series of abbreviated, fast-paced matches.
Limited to 20 overs (120 balls) for each team, Twenty20 quickly distinguished itself from traditional cricket. Fans flocked to these action-packed three-hour spectacles; what they saw was the birth of a faster, more aggressive, harder hitting version of cricket.
Twenty20 also proved popular with broadcasters, advertisers, and players. Each of these groups stood to profit from the new form of the game.
In the years that followed the ECB’s experiment, Twenty20 found backers elsewhere in the world. In 2004 the eight-team Pro Cricket League launched in the United States of America (USA); it lasted a single season and folded after the ICC refused to allow contracted players to join Pro Cricket, and after the league failed to sign a major broadcast deal.
In 2005 two Australian first-class teams sold out the Western Australian Cricket Association (WACA) ground in Perth when they played a one-off Twenty20 match. In 2006, seeking to revitalize the cricket fortunes of the West Indies, Alan Stanford held the eponymous Stanford 20/20 tournament in Antigua.
The following year, the ICC held the inaugural Twenty20 World Cup in South Africa; in a thrilling final, India beat Pakistan by five runs to win the tournament.
Much like India’s unexpected victory in 1983 in the 50-over World Cup, the country’s triumph in the Twenty20 World Cup ushered in new pride and new ambitions for the Board of Control for Cricket in India (BCCI).
With the backing of the BCCI and other national bodies, Twenty20 gained acceptance as a third sanctioned international format of the game, alongside Test and one-day matches.
Initially conceived as a mid-season diversion to attract fans to county matches, Twenty20 quickly grew into an essential money-maker and stadium-filler for domestic leagues in the world’s cricketing countries.
In India, Twenty20 gained a large following, but off-field politics led to several years of uncertainty. The country’s first Twenty20 venture, the nine-team Indian Cricket League (ICL), held its first season in 2007 with the backing of Zee Telefilms.
The ICL included a mixture of team types: a world XI, plus national teams representing India, Pakistan, and Bangladesh, and city-based teams in India and Pakistan.
In addition to the usual challenges a new league faces in its first year, the ICL had to deal with opposition from the BCCI. In previous years, fearing a loss of its monopoly broadcast position, the BCCI had denied Zee broadcasting rights for domestic cricket matches.
After being locked out of matches administered by the BCCI, Zee proposed the ICL. With its own league, Zee would enjoy unimpeded broadcast rights of ICL matches.
This presented not only an immensely profitable proposition for Zee, but also a threat to the BCCI’s domestic monopoly. Faced with this threat, the BCCI launched a legal and financial assault.
Battered from the start by lawsuits and political opposition from friends of the BCCI, the ICL lasted only two seasons before folding.
Throughout this contentious period, the BCCI’s enthusiasm for Twenty20 remained intact; what the BCCI wanted was a league under its auspices, to augment its own (already-dominant) position within India.
In 2008 the BCCI launched the Indian Premier League. To cannibalize the ICL, the IPL offered higher salaries; perhaps more importantly, the BCCI offered amnesty to players who had joined the ICL in violation of their contracts with national and domestic leagues.
With such an offer, and facing the possibility of bans by their national associations for playing in a non-sanctioned league, the remaining ICL players moved over to the BCCI-administered (and officially sanctioned) IPL.
With a mass exodus of players, the ICL folded prior to its third season. From the start the BCCI had large ambitions for the IPL, as well as good reasons to be confident.
The IPL enjoyed three initial advantages: national excitement over India’s early success in the Twenty20 format, the unparalleled size of the Indian cricket market, and the shrewd scheduling of the playing season, during April and May, between the conclusion of the Ranji trophy and the onset of the annual monsoon.
To introduce the league, underline its big-money status, and bring its players and uniforms into public view, the IPL televised its player auction for its inaugural season in 2008: As a new league in a sport unaccustomed to such displays of hype or capital, the IPL quickly gained attention – positive and negative – among fans and commentators.
Fast, brash, and divisive, the IPL launch symbolized the ambitions of its financial backers and the BCCI. These ambitions included a league focused on India.
Like the ICL it supplanted, the IPL has a quasi-national structure, bringing players from different cricket playing countries onto commercial teams in the Indian subcontinent.
But the IPL has a stronger national element than did the ICL, since it is run by the BCCI and hosted exclusively in Indian cities. In a sharp break with the pan south Asia approach of the ICL, the IPL has no teams in surrounding countries, and has refused to admit Pakistani players.
Part of this India-first strategy can be explained by the timing of the league’s formation: the 2008 Mumbai terrorist attacks prompted fears about public security in India, and the attack a year later in Lahore on the Sri Lankan national team only reinforced the view among BCCI officials that it had more to lose than to gain by hosting matches outside India’s borders.
Now that several years have passed since these events, the IPL’s exclusion of Pakistani players is more difficult to justify: it is one thing to restrict IPL matches to Indian soil so that the BCCI can retain greater control over security; it is something else to use the instability of a neighbouring country as an excuse to keep its players off the field.
Although the IPL has a stronger national element than did the ICL, it would be unfair to describe the IPL simply as a national league.
The IPL brings together players from the world’s cricketing countries (with the notable exception of Pakistan), occupies an established place in the international cricket calendar, and operates as an ICC-sanctioned tournament.
The IPL’s rules on team composition reveal the IPL’s dual national-global role: teams must have at least 14 Indian players in the squad and no more than 11 foreign players.
In any given match they may have no more than four foreigners among the playing 11. The rules also favour young Indian talent: each team must include at least six players from the BCCI’s under-22 pool.
With these rules, the IPL is neither as national as the Ranji trophy, India’s national first-class tournament, nor is it a fully global project. Rather, it is a distinctly Indian and cosmopolitan league.
The IPL presents a different sort of duality in its administration. The league is run by the BCCI, but its franchises are privately owned. In advance of the inaugural season in 2008, the BCCI auctioned off eight franchises for a total of US$724 million, an average of about US$90 million per team.
As the IPL expanded to new cities, franchise costs soared. In 2010 the conglomerate Sahara bought the then two year-old Pune Warriors for US$370 million, and Rendezvous Sports bought Kochi Tuskers Kerala for US$330 million.
As a point of comparison, two years earlier the century-old Manchester City football club changed hands for US$330 million.
But the most recent IPL team sale involved a much lower price: in late 2012, Sun Media purchased the remnants of the Deccan Chargers for US$80 million, a considerable drop from the acquisition costs paid by previous buyers.
Given the high cost of IPL franchises and the difficulties foreign owners face when making large acquisitions in India, team owners have tended to be large Indian conglomerates.
Owners have included giants in infrastructure and construction (India Cements, GMR Group, UB Group), media (Sahara, the Deccan Chronicle, Sun Media), and telecommunications (Reliance). Several Bollywood stars (Shahrukh Khan, Shilpa Shetty) have purchased stakes in franchises and have become public faces for their respective teams.
IPL owners provide a who’s who list of (mostly) new money in India and a snapshot of India’s leading industries. At the same time, the murkiness of team ownership, evidenced by the frequent use of shell companies and complex paper trails, suggests that the old game of corruption has found a new playing field.
A 2010 government report alleged that Lalit Modi, the former chairman of the IPL, held secret stakes in at least three different IPL franchises during his years as chairman.
As a new cash nexus in cricket, the IPL has created a new set of economic winners and losers, and challenged old assumptions about how the game should be managed.
IPL Media Rights :
Media rights in sporting leagues has come a long way in the global scenario in general and India in particular. The Olympic Games were first televised in Berlin in 1936 and broadcast to an estimated 162,000 people using just three cameras, only one of which was capable of live transmission.
Just over 75 years later, thanks to major advances in broadcast technology, an estimated 4.8 billion viewers were able to tune into seamless coverage of the 2012 London Olympic Games in high definition and 3-D formats, along with a dazzling array of angles, effects and tools to view and review every detail of the event.
Fancy this – in 1992 the BCCI paid Doordarshan Rs. 5 lakh to broadcast its matches on their network and today it stands to earn $8.47 million per IPL match courtesy to Star India’s broadcasting bid of IPL for $2.55 billion.
It all started with the Supreme Court judgment in favour of the BCCI towards the end of 1990’s, which led to BCCI making big money on cricket rights from the turn of the millennium (2000 – 2004).
Though sports broadcasting has made big strides within the country, it has a long way to go in the global context compared to the likes of NBA, MLB, NFL and EPL.
When it comes to media rights within the Indian context, we are witnessing a paradigm shift from one sport nation to multi-sport nation. Though the IPL is expected to dominate media rights within the country, there has been a rise of several non-cricketing properties within the last five years.
Owing to this the broadcasters have also started diversifying their portfolio of channels. For example, Star Sports has expanded into eight channels to showcase a variety of domestic and international leagues and tournaments.
Star Sports has also extended broadcasting rights for international hockey, as well as league matches, for the next three years The media rights have become the focal point for revenue generation for any league across the world.
With the massive interest generated, projections have gone insane. At the same time, they also bring about the capitalistic exponential that sports may plunge into.
But before we compare the media rights for various top sporting leagues across the world, each league has to be taken as a unique property with its regional and sporting context as well as the length of the league and the number of teams involved.
One may difference between leagues for cricket and any other sport will be the length of the league. Most countries play bilateral series throughout the year leaving a very small window for a franchisee-based league.
Whereas most of the other sports do not involve bilateral or multi sport competition except Olympics, CWG, Asian or Continental games every 4 years.
This gives a huge window for leagues to be played over 6-8 months. As most of the top leagues in the world have evolved over 4-5 decades, the fans have also got used to the long leagues and have a fixed calendar for bilateral or multi nation contests.
In comparison, the IPL is still in its nascent state and it will take time for its inventory cost to grow exponentially. With the ever growing media realm, newer platforms are available for sports leagues to reach out the population.
The spectrum ranges from conventional media like Print, Radio, TV all the way upto various digital platforms, viz facebook, live streaming, instagram, twitter, snapchat, gaming etc.
This has further fueled the media rights war. But this also provides the franchisees with an opportunity to improve their Returns on Investments.
The franchisees have to be proactive as well as innovative to extract the maximum out of all these available media platforms. This will require a creative effort to utilize conventional and non conventional media in tandem.
For example, a great mix of radio, TV, live streaming and social media will reap greater results for any franchisee. The same can be further scaled up through regional channels to improve penetration as well as engagement.
India is a diverse country with a large population. Most of the population is used to consume multi linguistic data. Hence the potent and holistic mix of all media across various languages is the ideal vehicle for a faster RoI as well as profits. Buying rights for such a strategy can be an important element in the future.
IPL Media rights auction this year :
IPL Media Rights broke the record of last five years. Media rights have been sold for the highest amount so far this year. The TV and digital rights have been sold for Rs 44075 crore. The e-auction of media rights for the next five years was done by the BCCI for two days.
The TV rights have been sold for Rs 23,575 crore. Whereas the digital rights have been sold for Rs 20500 crore. The TV rights have been bought by Sony TV. Reliance-Viacom has got the digital rights.
IPL’s digital rights have been sold to Viacom18, whereas Disney+ Hostar has been purchased by Hostar after a fierce bidding war.
Over 600 million people watch the Indian Premier League, making it the second most lucrative sporting asset in the world, behind only NFL.
The media rights auction brought in approximately Rs 44,075 crore for the BCCI, substantially tripling the IPL’s worth over the previous five-year cycle.
Mukesh Ambani’s Viacom18 emerged victorious and won the digital rights to IPL for the following cycle of 2023-2027 from the Indian Premier League (IPL). Ambani’s media platform should see an average nearly 600 million users each year as a result of this.
For Viacom18, the Indian Premier League is a crown jewel in its programming pipeline. On the other side, Star has paid a premium of 30 percent over the base price for television broadcast rights.
20,500 crore was raised in an auction of digital rights for the period 2023-2027. Since Disney-investment, star’s the IPL’s total value has increased by 2.5 times, to 43,255 crore (about $5.5 billion).
|A||TV rights – all matches||₹23,575 crore|
|B||Digital streaming rights – all matches||₹20,500 crore|
|C||Digital streaming rights – 18 matches||₹1,700 crore|
|D||Rest of the world||₹1,110 crore|
On the cost-per-match basis, humans believe, the virtual segment will come to parity with TV at finest and don’t see it moving any further than TV as TV does have a number of large FMCG advertising companies as well as digital, despite solid growth, has concern regarding on monetisation & subscription services video on demand (SVOD)—as India is a valuation market with tepid annual earnings per user.”