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IPL media rights auction: Who’ll tame the monster?

MUMBAI: On Monday, September 4, the BCCI – a body left bruised facing the wrath of the Supreme Court this last one year – will, in all probability, be laughing its way to the bank. Helping the cricket board do that will either be Star India Pvt Ltd or Sony Pictures Network -depending on who will eventually end up breaking the bank to grab the broadcast rights for the Indian Premier League (IPL).

In fact, as things stand, any surprise entrant in this race looking to spoil Star or Sony’s Potential party – from a television perspective alone – will end up surprising the entire fraternity all the same.

Thrilling as this battle might turn out to be, the fact is the idea of television alone is passe. It’s been there and will continue to remain. The element of surprise – a factor the sports industry thrives on – is busy witnessing the baton being passed on to Digital.

As TOI had reported in July, the last available balance sheets of IPL suggest that anywhere between Rs 12 to Rs 13,000 Crore has to remain a break-even figure – a no profit, no loss – that any potential bidder will be looking at, also taking the digital value into account. Even if a minimum of 10% inflation at incremental value is considered, a “sensible” bid should still not cross the Rs 15,000 crore-mark, say those tracking the industry. Rs 15,000 crore at the present value of the dollar would amount to $2.1b, which the industry admits is a mindboggling number.

Yet, the mood is so overwhelmingly upbeat right now that a section of those tracking developments refuse to back away from “prophesying” the overall bid to be in the range of US$3b – approximately Rs 20,000 crore or even more.

The question that the fraternity is asking is if somewhere around Rs 15,000 crore happens to be the generally accepted break even figure for companies to find the business sustainable, where exactly is the US$3b theory emerging from?

The rumble can be heard from the global digital platform. The BCCI, even in its wishful thinking, expects the global digital monster to rise out of its slumber this Monday. An Amazon or a Facebook, a Twitter or a Hotstar, the Board mandarins believe, should change the course of play.

“That’s uncharted territory. If this game is diverting from the predicted lines this week then blame it on digital. With the kind of reach that an Amazon or a Facebook have at their disposal, and the foreseeable optics involved given their market share, this auction has potential to head into a tizzy,” says an industry analyst.

And for this reason, all potential players could now be busy working on pre or post-bid consortium, throwing up possible scenarios of a Sony tying up with an Amazon – just to cite an example – to counter Hotstar.

“We’re looking at a potential consortium, a back-end understanding of sorts between parties, if Star has to be countered on all fronts,” add analysts.

While Sony alone can give Star a run for its money, partnerships will have to remain the need of the hour going forward, because the global bandwidth of cricket broadcast – from a combined perspective – is all set to change.

Source : timesofindia

This post first appeared on Daily Kiran, please read the originial post: here

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IPL media rights auction: Who’ll tame the monster?


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