CC Image courtesy of Public.Resource.Org on Flickr
The Indian Premier League (IPL) media rights were up for grabs and several companies made bids with Star India (formerly Star TV) coming out on top. The IPL is the most popular Twenty20 cricket league in the world and the global media rights eventually went for about US$2.25bn for 5 years from 2018-2022. Star India had competition from big corporations like Sony Pics, ESPN and Amazon and also from Supersport (DStv) and Econet Media (Kwese).
The bidding rules made it so that Star India with the highest consolidated bid clinched both digital and broadcast rights for both India and rest of the world. This means Supersport and Kwese missed out on rights for Sub-Saharan Africa but Star does not have as strong a presence in Sub-Saharan Africa. This means there will be a sub-licencing battle soon with Supersport and Econet Media among others fighting for this market.
The other big surprise, or not, was Facebook bidding US$600m for the IPL rights. It seems Facebook really is serious about video. Keep in mind that the IPL this year had about 1.25 billion impressions over 59 games with the final having 39.4 million viewers. Facebook recently launched Watch in the U.S which underscores a deliberate focus on video.
As the final going price of approximately US$2.25 billion for the global rights indicates, sports content is very expensive to acquire; i.e US$2.25 billion for 60 matches played over 6 weeks, repeated each year for 5 years expensive. That means the value per match is about $7.5m which is close to the value of a game in the English Premier League (football) at $9.5m.
It is with these figures in mind that bundling of channels becomes necessary so as to spread the cost of this very expensive sports content. It is the sport fans that get their content subsidised not the other way round.
In due time we will see who gets the sub-licencing deal for this Sub-Saharan African market. Supersport, Econet and Yupp TV all bid for this market. Who do you think will win? Would you consider Kwese TV over DStv is they had exclusive rights to the IPL? Let us know what you think.