How will BCCI media rights deal play out for Viacom18?

Viacom18 on Thursday bagged both TV and digital rights of the national team's home series for the next five years with a cumulative bid of approximately Rs 5,963 crore, beating Star India and Sony in a three-way battle.

Industry players view this development as a game-changer move by JioCinema.

Rammohan Sundaram

Rammohan Sundaram, President - Integrated Media, DDB Mudra Group, said, “With the power of Jio reaching all of India by the end of the year with its 5G services, it’s but natural to get everything possible on cricket in India. So all domestic, junior cricket and women’s cricket will now be on Sports18 and JioCinema.

As per him, JioCinema’s push for cricket is a natural next step, “After extensively embracing the digital realm with the Indian Premier League (IPL), JioCinema successfully amalgamated Voot into its platform. This integration also featured exclusive classic HBO content. Furthermore, with Bodhi Investments securing a 14% stake in Viacom18, strategy for the push for cricket was natural.”

Karan Taurani

Karan Taurani, SVP- Research Analyst (Media, Consumer Discretionary and Internet), Elara Capital, believes that a single entity securing both TV and digital rights is mutually advantageous, as it enhances the negotiating leverage of the platform.

“This allows them to offer bundled options to advertisers. In contrast, when two separate players acquire TV and digital rights, it fuels competitive rivalry between platforms, resulting in a dampening effect on overall revenues (IPL revenues were down YoY in CY23). We believe bundling prevents advertisers from holding a stronger bargaining position as compared to the platforms,” he said.

“Acquisition of BCCI bilateral rights will also enable JioCinema to become even bigger in the Indian OTT ecosystem. The platform has an AVOD market share of 22-24% already in CY23, after factoring in IPL revenue and other content. Revenues can scale up further due to these bilateral rights. Moreover, this in turn will intensify competition in the OTT segment and work negatively for other broadcast-based OTT players like Sony, Zee and Disney+Hotstar. It will also continue to negatively impact SVOD revenue growth for Indian OTT, as JioCinema may continue to offer content free,” he added.

The overall premium paid by Viacom18 versus the last cycle is 13%. In the case of IPL, the premiums were almost about 120-130% on a per-match basis versus the earlier cycle.

India will be playing 88 international games across three formats including 25 Tests, 27 ODIs and 36 T20Is with per match value of the deal standing around Rs 67.76 crore. This is nearly Rs 7.76 crore more than last cycle's Rs 60 crore per match value.

The BCCI had invited separate e-bids for both linear (TV) and digital for best price discovery. Viacom18 paid Rs 3,101 crore (approximately) for digital and Rs 2,862 crore for linear (TV).

The rights will come into effect with India's three-match home series against Australia beginning on September 22 and ending on March 31, 2028.

The industry players believe that for Viacom18, it is not a bad price to fetch as the per-match valuation has increased.

A close observer of the BCCI bilateral matches media rights, said, “One needs to factor in that only marquee Test matches and series versus England and Australia will fetch a decent advertisement revenue. For matches against other nations, it is only the T20 which is the cash cow.”

India will play Australia in 21 games and will be pitted against England in 18 matches across three formats during the next five years.

The observer further stated, “The BCCI fell way short of the billion dollar mark (at least by Rs 2,300 crore) and one of the reasons for that could be the declining popularity of the ODI format and there are 27 of them in the next cycle.”

Stating the reasons why BCCI couldn’t charge a very high premium on the current media rights cycle in comparison to the last one, Taurani said, “One is the ad environment not being conducive. Second, there is not much interest in terms of bilateral matches. Third is, the audience is moving away from ODI and test matches, potentially resulting in a reduced number of T20 matches within this package,” Taurani said. 

However, an industry source said that even after the premium on the current cycle is 13%, the cost of acquiring the media rights is notably high, which further complicates the task of turning this property into a profitable venture.

Some industry sources also believe that bilateral cricket series have experienced a decline in their overall importance, along with decreasing viewership and revenues.

“Pursuing them as a financially rewarding business opportunity is not viable. Additionally, the challenges are compounded by the non-participation of essential Indian players in matches, the unpredictable advertising market, and more such reasons,” a source said.

Shashank Srivastava

As per Shashank Srivastava, Senior Executive Director- Marketing and Sales, Maruti Suzuki,

Maruti Suzuki India has been associating with sports especially cricket due to a high affinity with their target audience.

“We would like to congratulate Viacom18 for acquiring the TV and digital rights for BCCI home international matches for a period of five years. We do observe that the winning bid is 12% higher over last cycle,” Srivastava said.

“Recognising the passion of Indian cricket fans, we plan to stay associated with both Disney Star and Viacom18 for the upcoming cricket tournaments, as cricket fuels the enthusiasm of every Indian. We look forward to working closely with both broadcasters in the coming future,” he added.

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