Star sets new record with Rs 16,347.5 crore bid for IPL media rights
MUMBAI: The Indian Premier League (IPL) media rights have changed hands with Star India knocking out close competitors Sony Pictures Networks India (SPNI) and Facebook, with a composite bid of Rs 16,347.51 crore to bag the TV, digital rights for India and rest of the world until 2022.Star’s journey as the official broadcast partner will begin in 2018.
This is the biggest-ever cricket rights deal so far, even breaking the previous record of $1.98 billion for ICC rights, which too are held by Star. The broadcaster also holds BCCI rights until March 2018. It had paid Rs 3,851 crore to telecast India cricket.
Sony and Star India-owned Novi Digital were the incumbent TV and rights holder for the Indian subcontinent. While Sony had paid Rs 8,200 crore for the 10-year TV rights, Novi Digital had bought the three-year digital rights for Rs 302.2 crore.
Sony had built its sports business on the back of the IPL. The broadcaster had last year hedged its bet by acquiring Ten Sports from Zee Entertainment Enterprises Ltd (ZEEL) for $385 million.
The windfall from the IPL media rights sale will fill the coffers of BCCI and IPL franchises, many of whom are still struggling to break-even even after being in the business for 10 years. Earlier, the BCCI had sold IPL title sponsorship rights to Chinese handset brand Vivo for Rs 2,199 crore for the period until 2022.
The addition of the IPL will make Star the most powerful sports broadcaster in the country. The broadcaster virtually owns most of the cricket rights including the ICC, BCCI, ECB, Cricket Australia and Asian Cricket Council. It had paid $1.98 billion for ICC rights.
The recent judgment by the Supreme Court restraining Prasar Bharati from carrying sporting events of national importance on private distribution platforms had only strengthened the broadcaster’s hands as this will help it maintain the exclusivity of cricket content.
The SC order will mean that only DD’s terrestrial network and DTH platform Freedish can be used to transmit these events.
Star was the only player to place a consolidated global bid for the IPL while SPNI bid for India TV rights and media rights for South Africa.
The Rupert Murdoch-promoted broadcaster’s consolidated bid was higher than the sum of parts bid of Rs 15,819.51 crore of other players in different categories.
SPNI was the highest bidder in Indian sub-continent TV rights with an Rs 11,050 crore bid while Facebook emerged as the highest bidder for the India digital rights with a bid of Rs 3,900 crore.
Star India chairman and CEO Uday Shankar said that having TV and digital rights together would allow the network to serve cricket audiences better.
“In our case, we made a very conscious call that we will bid for the global rights because we have significant presence in each of these three universes. We have a TV presence in India. We have very robust digital platform which we are rolling out across the world. Our channels are distributed globally so it made sense for us to make an attempt for the global market,” he said in a post-bidding press meet.
Besides Star, Sony and Facebook, the other prominent bidders in the race were Reliance Jio, Bharti Airtel, Times Internet, Al Jazeera-owned sports channel beIN Sports, SuperSport, Followon Media Interactive, YuppTV, OSN, Econet and Perform Group.
Airtel, Reliance Jio and Times Internet bid for India digital rights. Their bids were Rs 3,280 crore, Rs 3,075.72 crore and Rs 1,787.5 crore. Times Internet, additionally, also bid for Australia, New Zealand, and the rest of the world (RoW) and US markets. YuppTV bid for the Middle East and US markets.
Among the RoW rights, the Middle East and North Africa region received the highest bid of Rs 390 crore from beIN Sports.
The US market received the second highest bid of Rs 240.5 crore among RoW territories from Perform Group. SuperSport bid Rs 120.25 crore for South Africa and rest of Africa.
Followon Interactive Media bid Rs 70.01 crore for Australia/New Zealand and RoW while Star bid Rs 48.75 crore for UK/Europe.
Fourteen out of the total 24 bidders who had bought the tender document had submitted their bids. Amazon India, which was widely expected to bid for India digital rights, backed out of the race. Discovery Communications India, which was among the new players to purchase the tender document, did not participate in the bidding process.
Of the 14 companies that submitted bids, one bidder BAMTech, which is an American internet video provider, was disqualified due to missing documents from its technical bid.
beIN Sports was allowed to participate in the bidding process after it sent an email that Qatari law does not permit providing financial statements. The company also said that it has participated in bidding for many sporting properties across the world without providing financial statements.
Similarly, Perform Group was allowed after it provided the BCCI with the Articles of Association of the company.
BCCI acting president CK Khanna said, “We are happy to announce Star India as our new global media and digital partner. We thank all the bidders that participated in the process. We have ensured that transparency of the highest form was maintained throughout the process. I would like to thank cricketers and franchises for making the league one of the eminent sporting leagues in the world. I would also like to thank all the fans for showing their continuous support for the Vivo IPL for the last 10 years.”
BCCI acting secretary Amitabh Choudhary said, “We welcome Star India on board as our broadcast and digital partner. Cricket as a sport has evolved over the years, and today’s bids were a reiteration of Vivo IPL’s growing global popularity.”
BCCI CEO Rahul Johri said, “We would like to welcome Star India on board as our IPL global media and digital partner. We believe this is a global benchmark and all the stakeholders of the IPL will significantly benefit from this association with Star India.”