This IPL season, VIVO, Amazon, Brezza aggressively focus on youth-based ads on HOTSTAR

“IPL has come to the rightful home of the cricket in India,” said Uday Shankar, CEO of Star India as the channel clinched the television (India and Rest of the World) and digital broadcast rights for Vivo IPL for Rs 16347.50 crore. The final fight for the rights turned to be, as expected, between Star India and Sony Pictures Networks. Star India didn’t leave any stone unturned and made the single highest bid for the broadcast rights. It bid Rs 6196.94 crore for India television broadcast rights and Rs 1443 crore for India digital rights.

“I would like to thank BCCI for trusting us with IPL. We believe that it is a very powerful property and that lot more values can be created for the fans of cricket and viewers on IPL through digital and TV,” added Shankar, who promises to create a ‘complete experience.’ There was the fear of losing if the amount was ‘slightly less’, he expressed. He added that every category was competitive.

“We were committed to delivering the most transparent process for bidding for IPL,” said Rahul Johri, CEO, BCCI.

Meanwhile, Sony Pictures Networks (SPN)’s bid was higher in the India broadcast category at Rs 11,050 crore. It didn’t bid for any other right except for Rs 84.50 crore for one category of ROW (Rest of the World) while its competitor Star India bid for all other rights.

A spokesperson from Sony Pictures Networks said, “Sony Pictures Networks India (SPN) has nurtured IPL since its inception and within a span of 10 years established it as one of the most popular sporting properties in the world. We would like to thank all those who supported us in curating the lineage and legacy of IPL. At the same time, we take this opportunity of wishing STAR India the best as they shape IPL over the next five years.”

Fourteen out of 24 companies had participated in the auction: beIN Sports, SuperSport, YuppTV, Times Internet, Gulf DTH, Facebook, Airtel, Star India, BAM Tech, Sony Pictures Network, Econet Media Group, Perform Group, Followon Interactive Media and Reliance Jio.

Amazon, Taj TV, Gulf DTH, Group M, Media India, Sky Uk Ltd, ESPN Digital Media, BTG Legal Services, BTPLC, Twitter and Discovery didn’t submit the bids.

After the technical evaluation Star India and SPN were qualified to bid for the TV broadcast rights while Airtel, Reliance Jio, Facebook, Times Internet and Star India qualified for digital rights. For Rest of the World, Yupp TV, Followon, Perform Group, Supersport and beIN Sports qualified. BAM Tech was disqualified because a lot of fundamental documents were missing from their bid.

IPL’s journey started early in 2008 when Sony acquired its rights for 10 years for $918 million. Then again in 2009 the company re-acquired rights for $1.63 billion for 10 years after renegotiation. In February 2015, Star India had got the internet and mobile rights for three years for Rs 302.2 crore.

According to Duff & Phelps, a global valuation and corporate finance advisory, IPL in its tenth year is worth Rs 34,000 crore ($5.3 billion) and has posted a 26 per cent increase in its overall business from Rs 27,000 crore ($4.2 billion) last year. The league has seen a three-year CAGR (compound annual growth rate) of 13.9 per cent.

Bringing end to all speculations, Star India has won the television (India and Rest of the World) and digital broadcast rights for Vivo IPL for Rs 16347.50 crore. The fight for the rights was primarily speculated to be between Star India and Sony Pictures Networks. Star India made the single biggest bid for the broadcast rights.

14 out of 24 companies had participated: beIN Sports, SuperSport, YuppTV, Times Internet, Gulf DTH, Facebook, Airtel, Star India, BAM Tech, Sony Pictures Network, Econet Media Group, Perform Group, Followon Interactive Media and Reliance Jio. BAM Tech got disqualified BAM Tech is disqualified because a lot of fundamental documents were missing from their bid.

Amazon , Taj TV , Gulf DTH, Group M, Media India, Sky Uk Ltd, ESPN Digital Media, BTG Legal Services, BTPLC , Twitter, Discovery didn’t submit the bids.

Early in 2008 Sony acquired IPL rights for 10 years for $918 million. Then again in 2009 the company re-acquired rights for $1.63 billion for 10 years after renegotiation. In February 2015, Star India had got the internet and mobile rights for three years for Rs 302.2 crore.

According to Duff & Phelps, a global valuation and corporate finance advisory IPL, in its tenth year, is worth Rs 34,000 crore ($5.3 billion) and has posted a 26 per cent increase in its overall business from Rs 27,000 crore ($4.2 billion) last year. The league has seen a three-year CAGR (compound annual growth rate) of 13.9 per cent. 

The media rights for the Indian Premier League (IPL) go under the hammer today. A total of 14 companies have submitted bids for the rights, which include TV and digital broadcast in India and overseas.

Industry observers we spoke with said that digital rights in particular would be fiercely contested.

Digital rights for the IPL are currently with Star India, which paid around Rs 302 crore in 2015 for a period of three years.  

The new digital rights encompass a period of 5 years, starting from 2018 through 2022.

BCCI is expected to make a windfall of around Rs 15,000 crore to Rs 20,000 crore for the various rights.

Digital streaming is a tricky business in India given the nascent nature of subscription revenue in the country. Digital broadcasters have to depend on advertising revenue to fuel operations.

For example one media planner told us that Star India would have made around Rs 70-80 crore in ad revenues last year on the back of IPL. When you consider that the cost of the rights come to around Rs 100 crore per annum, the question is whether it makes financial sense to the company.

However, analysts and industry observers stress that one cannot determine the value of IPL for broadcasters just on the basis of revenue.

"It (IPL) creates a huge sampling base for the company so it makes sense from a marketing point of view. There has also been a huge migration of cricket advertising monies to digital," opined Shekhar Banerjee, COO at Madison Media. He also pointed out that Star's digital platform Hotstar has seen a massive scale-up in traffic due to the IPL.

Thomas Abraham, Editorial Director at Sportz Network Ltd, also opined that IPL has been a driver for Star India's Hotstar.

"Digital is a new space so growth is higher. You have to look at all the other things they have built on the back of IPL before deciding on the value that they have derived from the IPL. On digital, if you are only talking about advertising, then you are missing the point," he said.

Highlighting the importance of the IPL digital rights, Abraham further added that this space would see the highest percentage increase due to higher number of bidders.

"The potential for irrational bidding will be in digital rights," he said, further adding that a consolidated value of around Rs 14,000 crore is a fair amount. "If we go by market estimates (of total value of media rights) of Rs 20,000 crore then I feel the excess Rs 6,000 cr would be because of irrational bidding for digital rights," he said.

24 companies had picked up the rights papers of which 14 have now submitted their bids for the various rights. These include, BeIn Sports, SuperSport, YuppTV, Times Internet, Gulf DTH, Facebook, Airtel, Star India, BAM Tech, Sony Pictures Network, Econet Media Group, Perform Group, Followon Interactive Media and Reliance Jio.

Notable absentees from the final bidder list include the likes of Amazon, Discovery and ESPN.

After the technical evaluation following companies have qualified to bid for the following TV broadcast rights (India): Star India and Sony Pictures Network. They can bid for the other rights

Airtel, Reliance Jio Facebook, Times Internet and Star India have qualified for digital rights

For Rest of the world Yupp TV, Followon, Perform Group, Supersport and beIN Sports have qualified.  

beIN Sports is waiting for clarification on financial. BAM Tech has been disqualified. 

A total 24 of institutions have reportedly shown active interest in the media rights of Indian Premier League (IPL). Industry sources mention Airtel, BAM Tech, DAZN / Perform Group and Yahoo being the latest entrants in the race. In our earlier report we had shared that around 20 companies including iAmazon Seller Services, Reliance Jio Digital Services, Twitter, Facebook, ESPN Digital Media (India), Times Internet, GroupM, Yupp TV and Discovery, besides both Star India and Sony Pictures Networks have bought the bidding documents for the auction and would be contending for its television and digital rights.

Submission of the ITT is set on September 4, 2017.

 After the 10th edition, IPL had a valuation of USD 5.3 billion, according to global valuation and corporate finance advisor Duff & Phelps. As per Sony Pictures Networks India, IPL crossed a viewership of 400 million in the 10th season. IPL's digital partner Hotstar clocked ad revenues of 1.2 billion.

VIVO renewed the contract for IPL title rights in 2017 with a massive 554 per cent rise in sponsorship money to Rs. 2,199 cr. The media rights for the next 5 seasons are expected to arrive at a groundbreaking figure, with brands willing to invest heavily in this cash-rich tournament.

VIVO IPL 2017, aired on Sony MAX, SIX and ESPN had a phenomenal reach of 185.7 million viewers in the first three matches, according to audience measurement agency, BARC. More importantly, there has been a significant growth of 40 per cent in impressions (for first three matches) from the last season to the current one.  In fact, the IPL has catapulted Sony MAX to second spot in BARC’s Top 10 Channels in the Across Genres category, with it garnering 853 million impressions.

Neeraj Vyas, Senior EVP & Business Head, Sony MAX cluster, SPN, credits this spike in viewership to high scores of the first three matches and expansion of the BARC universe as he says, “It has lot to do with the expansion of BARC universe.”

Vyas expects the viewership to remain steady for the first two weeks. “The first three matches had high scores unlike the previous years where 170 or 180 score would happen only after a week or 10 days.  This will remain steady for a while. With Virat Kohli coming in the excitement will only increase. My instinct is that ratings will remain stable for the first two weeks, comparable to this week. After that it, of course, depends on the nature of the game. Overall there has been growth from all sides,” he adds.

The opening match between Sunrisers Hyderabad and Royal Challengers Bangalore on April 5 fetched 28.3 million impressions while the second match between Mumbai Indians and Rising Pune Supergiants on April 6 garnered 30.3 million impressions. The third one between Gujarat Lions and Kolkata Knight Riders on April 7 brought in 29.7 million impressions. In the previous season, the first three matches garnered somewhere between 20 million and 24 million impressions.

Vyas also factored in the overall ‘great’ quality of cricket (in terms of recent matches) that brought in positive ratings, saying, “Since the last six to eight months the ratings of cricket have been constantly growing. The India-England test matches, ODIs and T20s had phenomenal ratings. Same goes for India-Australia test matches which were received extremely well. Cricket viewing is back.”

Anita Nayyar, CEO, Havas Media Group, India and South Asia, also attributes the increase in viewership to the good quality of matches coupled with a strong youth connect. “Games per se are bringing in a lot of viewers. Matches with many young players are connecting with the youth, which has increased viewership. We have to dissect and see if the viewership has grown in the youth age bracket. As a game it's becoming younger. Whether the young players are getting connected with the youth and hence the viewership is increasing or whether the regular cricket lovers love the new guys who are coming, all of them are performing very well,” says Nayyar, who like Vyas, also credited the increased viewership to the recent expansion of the BARC universe.

Dinesh Vyas, Associate VP (Planning) at OMD, on the other hand, doesn’t find the spike in viewership ratings surprising. He says, “The IPL viewership follows a certain trend. The first 10-15 matches always start off with great (viewership) numbers, then it subsides in the middle and again picks up during the quarters, semis and finals. The trend is still similar and it will not change this year. IPL offers a great opportunity, more specifically this year, for brands to put in money after demonetisation. Hence, it has started off on a high.”

He adds, “When it comes to comparison with last year, the number of people connected to cable and television is anyway going up. BARC universe has also expanded. IPL is entertainment more than cricket. Also, it comes at a time when people have more free time with exams being over and most people still not travelling.”

Nayyar also feels that the tenth year has a lot to do with the increase in viewership, as she says, “Each year Sony has different themes around IPL.  Everyone is aware that it's IPL’s 10th year with Sony. They don't know how it's going to pan out next year. Sony has beautifully played on this emotion of 10 years. It's one form of cricket which is cricket plus entertainment so it's increasingly connecting with the viewers.”

One would assume that this increasing viewership is bound to bring in more brands to the table, that too immediately. But Nayyar has a different take on it, as she adds, “As far as the viewership hike is concerned brands will wait towards the end. Normally if you see the graph, it builds up towards the end. There are lots of brands who will wait for the second half to build that confidence that allows Sony to make more money.”