James Murdoch on Star’s FY18 EBITDA target, IPL rights, and Star Bharat’s growth
MUMBAI: 21st Century Fox CEO James Murdoch has said that company’s India business under Star is very much on course to achieve the EBITDA target of $500 million in FY18 while noting that there are ups and downs in every business.
Fox and Star follow July-June financial calendar.
While Murdoch didn’t elaborate on the ups and downs he asserted that the target will be met. He is also excited about the growth shown by Star Bharat ever since it launched in August 2017. Star Bharat’s viewership has gone up manifold ever since it launched on DD’s free DTH platform Free Dish.
“And with respect to Star, yeah, it’s halfway through the fiscal year. Always there are ups and downs in these things, but we see nothing at this point to make us feel any differently about the targets both in the short term and the medium term. And we’re thinking about the long-term as well,” Murdoch told analysts recently.
“So, we’re very excited about the balance of the year. Star Bharat, the big free-to-air channel has done very, very well in its launch this year. And we’ll get thereabouts.”
21CF’s international advertising revenue for the three ended 31 December 2017 increased, as compared to the corresponding periods of fiscal 2017, as a result of local currency growth of 12% primarily due to higher revenue at Star India led by higher pricing and volume at Star’s general entertainment channels and an increased number of cricket matches broadcast in the current period compared to the prior year.
Answering a question on the durability of companies like Fox to pay higher sports rights in the light of the threat posed by digital companies, Murdoch cited the example of Indian Premier League (IPL) rights for which it was pitched against Facebook for the digital rights.
He also said that the company has a great platform to monetise the rights. Star had paid Rs 16,347.5 crore to secure IPL rights for five years.
“If we look at the IPL auction in India last year, we were competing very aggressively with Facebook in that auction, and we have a great platform there. It’s a great platform for monetisation. It’s a great platform for reaching the audience, and we were able to win that auction,” he noted.
Murdoch said that it is really a question of making choices and that’s why it is not necessary to compete for every set of rights and pay whatever it takes.
“It doesn’t really matter who’s bidding. I mean, people have to make economic choices around the value of these rights, the value of these products. So, we like our ability to compete across the board with these brands with a variety and a diversity of rights that I think we’ve proven ourselves in terms of being able to put together really compelling packages there. But it’s never a question of all or nothing. You have to make choices, and sometimes you don’t think something is worth as much as somebody else does, and you steer the business in a different direction,” he elaborated.