$350 million and counting

$350 million is the base price set by the BCCI for the media rights for Indian cricket for the next 4 years - an astounding sum of money any which way you look at it. This has also put to rest all speculation that with the new Government regulations of sharing cricket feeds with Doordarshan coming into force, the rights value could actually fall. Of course, bids have to be made still, but it is very likely that there may be an increase over the 350 mill $ that the BCCI has set as base price.

What does the rights entail?

- 162 days of live cricket per year for the next 4 years at a minimum. This includes 12 Tests (60 days), 30 ODIs, 70 days of domestic cricket, and 2-7 offshore games (primarily India - Pak games played in venues like the US, Dubai etc).
- Media included cable, DTH, broadband, mobile and radio.
- If a universal bidder can bid for the whole package, and their aggregate bid is higher than the individual bids for specific media and region bids, the universal bidder wins all the rights.
- The BCCI will do it's own production for TV, and the chosen broadcast partner will have to carry the BCCI logo as well.

If you recall, Zee had bid 308 million $ for the previous bidding process, which got stuck in court. Why is the BCCI asking for more this time? For starters, the BCCI has struck deals with popular countries like Australia, England and Pakistan to have more reciprocal tours. A stable calendar with more home games against these countries and fewer games against Bangladesh and Zim make the cricket more interesting. Of course, the 70 mandatory days of domestic cricket will be a bit of a drag for the broadcasters, but it is also a challenge for them to popularize the game at the domestic level. If they can pull it off, that would be another goldmine waiting to be mined.

Also, this time the rights include other media like broadband, mobile, DTH and radio - by creating different slivers of rights to give out, the BCCI is attempting to maximize revenue. It will be really interesting to see how the broadband and mobile rights are valued. India's mobile and broadband market is still very nascent, and it remains to be seen if the BCCI can get the right value for these rights, especially since 4 years is a very long time for these technologies. Radio is an interesting one because finally the AIR stranglehold seems to have been broken, and with the recent FM bidding for various cities going on in India, there is money to be made on these rights. DTH is too insignificant now, but with the 4 year window now open, again a tricky one to evaluate.

I hope to write more on these aspects in subsequent posts.

Categories: Sport business, cricket