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How consolidation in sports broadcasting will impact ad rates

MUMBAI: With Sony in the process of acquiring Ten Sports, the move leaves two major players in the market—Sony and Star India, along with a smaller one, Neo Sports. The question is what impact this might have on ad sales strategies.

Madison Media, OOH partner and group CEO Vikram Sakhuja feels that there is an opportunity for Sony and Star to offer more value to advertisers.

“Whenever there are fewer players due to consolidation, strong and niche assets sell better. This is a better situation than properties getting fragmented across many channels. There is an opportunity for them to provide more value to advertisers. How they do that remains to be seen,” he says.

Vikram_Sakhuja_Sakhuja notes that with consolidation, prices might go up but there is at the same time scope for offering more value to advertisers.

He also feels that consolidation will help the players build synergies and leverage properties much better.

Will Sony bundle certain properties in a genre together to better leverage their strengths? For Sony, the bundling opportunity if it chooses to go down that route comes in certain properties like fight sports where it will own WWE, UFC and TNA Wrestling once the deal with Ten Sports sails through. It also will have more soccer properties like the Uefa Champions League. It already owns major rights to soccer properties like Fifa, La Liga and Serie A.

Properties that come from Ten Sports will include India’s tour to the West Indies and Sri Lanka next year, as per the ICC’s FTP. Against the West Indies, India plays 5 ODIs and a T20 as opposed to the Test series played this year. India tours South Africa in 2018.

Some of Ten Sports’ properties

  1. Five cricket board rights: Sri Lanka, South Africa, Pakistan, Zimbabwe, West Indies.
  2. WWE: Ten Sports has always had this since it launched in 2002.
  3. Soccer: Uefa Champions League, I-League, Europa League, Ligue 1
  4. Golf: European Tour, Asian Tour, Ryder Cup, LPGA Tour

Shashi SinhaIPL Mediabrands India CEO Shashi Sinha though feels that consolidation in sports broadcasting will have no impact on property prices. “Clients buy on the basis of a property’s value whether there are 10 broadcasters or two. How does it matter how many broadcasters are there,” he says.

According to Sinha, sport is bought by advertisers event to event, especially the big-ticket properties like the IPL.

Ashish BhasinDentsu Aegis Network chairman, CEO South Asia Ashish Bhasin also does not see consolidation having much of an impact in terms of ad rates. “It might allow Sony to do more focused deals. But for an advertiser the focus will continue to rest on the viewership of a property. In any case, when you buy for a sports event or any event like a movie, there is a monopoly. You can only buy the IPL from Sony. You can only buy BCCI cricket from Star. You cannot go elsewhere. That will continue to be the case.”

A media buyer noted that Sony and Star might come to an informal understanding about not dropping ad rates below a certain mark. “That is now much easier to do since there are only the two of them. If that happens, then there will be an impact. This is a different situation from competing for sports rights. But simply bundling properties together might not make much of an impact.”

According to a sports broadcast executive, more run of daypart (RODP) deals may be managed as advertisers want reach.

Another issue is whether one might see anchor clients come up more. In the past Neo Sports has done it as has ESPN Star Sports. This means that a client commits a certain outlay for the year and gets a presence across multiple properties on that broadcaster for the year.

Sakhuja, however, maintains that sports sponsorship is expensive and clients pick and choose.

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