2022, the year of cricket: Mega rights bids to see media cos invest up to Rs 50,000 cr

2022 will be a year of big-ticket investments for acquiring media rights to marquee properties like the Indian Premier League (IPL), International Cricket Council (ICC), and Board of Control for Cricket in India (BCCI). If market estimates are to be believed, media companies like Star India, Zee-Sony and Viacom18 might have to commit investments worth Rs 50,000 crore to Rs 60,000 crore for the three properties.

If these estimates turn out to be true, the days of a single broadcaster owning all three rights will come to an end. Currently, Disney-owned Star India has the rights to all three properties. It had acquired IPL media rights for five years at a whopping Rs 16,347.5 crore in 2017. For BCCI media rights, the broadcaster had paid Rs 6138 crore for five years. It had bagged the ICC media rights in 2014 till 2023 for roughly Rs 12,000 crore.

Star's IPL media rights deal with the BCCI expires in 2022 while the agreements for the ICC and BCCI media rights will end in 2023. Industry sources say the BCCI is set to come out with the IPL media rights this week. The BCCI is expected to award the media rights through an e-auction process.

ICC is expected to hit the market once the BCCI concludes the process of awarding the IPL media rights. Unlike the previous eight-year global media rights cycle, this time, the ICC is looking to sell territory-wise rights starting with India. The media rights cycle might also be halved from the current eight years to four years since the media landscape is rapidly changing.

"While it's very difficult to peg the estimated value of the three cricket properties. The numbers floating around in the market is that the IPL media rights could attract Rs 40,000 crore. On ICC, it's around Rs 11,000 to 12,000 crore depending on whether it is four years or eight years. BCCI might be in the region of roughly Rs 10,000 to 12,000 crore," a top executive from a leading broadcasting firm said on the condition of anonymity.

He also said that the ICC media rights value will depend on several factors like the match timings, the number of India matches, and the ones featuring the weaker teams. "ICC has not decided a very good structure. They have said that the World Cup will happen in the US. There will be a lot of games featuring weaker teams. For India-based broadcasters, it becomes less lucrative. It's good for the world of cricket but not necessarily good for the Indian broadcasters," he added.

Out of the eight ICC tournaments between 2024 and 2021, India will individually as well as jointly host three tournaments including ICC Men's T20 World Cup 2026, ICC Men's Champions Trophy 2029, and ICC Men's Cricket World Cup 2031. However, the Indian broadcasters are concerned about the match timings of tournaments like ICC Men's T20 World Cup 2024 in West Indies & USA, and ICC Men's T20 World Cup 2028 in Australia & New Zealand.

An experienced sports media professional said that the winner of IPL media rights will not have the propensity to bid for other rights. "Whoever wins the IPL media rights will not have money for a second bid because the winner will have to put in such an aggressive bid that it will become difficult for them to even consider other properties. All three rights being with one player is impossible in this environment because nobody can afford to pay that much money. Whoever wins IPL will have to remain satisfied with it. This will allow the other players to bid for ICC and BCCI rights," the executive said.

He further stated that there is a possibility of ICC and BCCI media rights seeing a lower value since the winner of IPL media rights will be out of the race to bid for these properties. "The competition for ICC and BCCI rights will go down since the winner of IPL media rights will be ruled out of the race."

While maintaining that IPL media rights might touch Rs 40,000 crore, Triplecom Media iTap Founder and CEO Kunal Dasgupta said that the BCCI media rights might see a 25% increase from the Rs 59.1 crore per match that Star is currently paying. He also said that the BCCI media rights value might see an appreciation depending on the number of games available during the rights cycle. "BCCI can expect at least a 25% jump in its value. The number of games every year will also be an important factor in determining the value of the rights," Dasgupta averred.

He also feels that the ICC media rights value will depend on the number of India matches, "ICC value might be slightly lower because of the staging of certain events in territories like US & West Indies, and Australia & New Zealand. Right now, it's very vague as events are not clearly defined. Hopefully, we will have more clarity by the time the property comes up for grabs. For ICC rights, the number of India games will be the deciding factor," Dasgupta added.

He also said that selling territory-wise rights will work well for the ICC as it will help them realise the true value of the rights in key territories like England and Australia. "There is no visibility on their side about the exact number of events. They might get more value from markets like Australia and England rather than lumping it together with India. For multi-lateral tournaments, all the countries should get their fair value."

Of the ICC's $2 billion media rights bid last time, Dasgupta feels that $1.2 billion to $1.3 billion of that value can be attributed to the Indian market. "Among the three properties, ICC is the least visible while IPL is the most visible followed by the BCCI since they have a well-defined calendar."

According to a sports business expert, the IPL and BCCI rights will be high on the priority list of all the key players in the market. "For a sports broadcaster, IPL is a bread-and-butter property while BCCI is also must-have due to India matches. The challenge with ICC is that it is difficult to monetise this property due to timing issues, the presence of numerous non-India games, etc. BCCI would want a 30% increase in the media rights value of IPL and India cricket rights. The numbers that these properties might attract is staggering, but then players like Disney and Zee-Sony also have very deep pockets," he noted.