Amazon and Reliance Should Lock Up With Disney and Sony Over IPL Rights

Deepak Gupta February 21, 2022
Updated 2022/02/21 at 11:13 AM

Amazon’s rivalry in India with oil and retail conglomerate Reliance Industries looks destined for the cricket field, where they will likely face off against media heavyweights for the rights to broadcast India’s top cricket league with its hundreds of millions. of spectators.

Amazon and Reliance are expected to take over Sony Group and Walt Disney’s Indian units for exclusive five-year digital TV and broadcast rights to the two-month series of matches, at a cost that could reach a record $100. LOL. 50,000 crore, sources familiar with the companies’ plans said.

“Cricket is the second biggest sport in the world, with two and a half billion fans, and the IPL is like the Super Bowl,” said Anton Rublievskyi, head of Parimatch, a betting company that advertised in the Indian Premier League (IPL) last year. “If you’re not there, you don’t exist.”

Disney-owned Star India which is one of India’s leading broadcasters along with Sony and its planned acquisition of Zee Entertainment Enterprises paid Rs. 16,348 crore for digital and television rights through 2022. League matches reached 350 million viewers during the first half of the 2021 season alone, on Disney+ Hotstar and Star Sports channels.

But traditional media companies now face stiff competition from well-heeled rivals such as Reliance, India’s biggest retailer, and Amazon, two billionaire-led giants vying for the fast-growing e-commerce market as they build their digital platforms. Amazon runs Netflix-like rival Prime Video, while Reliance offers JioTV to its telecom and broadband subscribers.

Amazon and Reliance are already locked in a court battle over acquiring assets from Future Group, another major Indian retailer.

Reliance is also in talks with investors, including foreigners, to raise up to US$1.6 billion (about INR 11,920 million) for its broadcast joint venture, Viacom18.

“Winning this offer is critical to Reliance’s long-term plans for its Jio platform and its digital expansion,” said a source with direct knowledge of the company’s strategy.

“Everything that has happened at Viacom18 in the last few months, like buying the rights to the Spanish La Liga and creating a sports channel, was built for this,” the source said.

Reliance and Viacom18 did not respond to requests for comment.

Amazon, whose Prime Video platform recently started streaming live cricket matches, wants to win the IPL rights to expand the platform’s user base, another industry source familiar with the company’s thinking said.

A spokesperson for Amazon India did not respond to a request for comment.

The company does not have a TV platform and would need to bring in a TV partner or could only bid on the digital part. The Board of Control for Cricket in India (BCCI), which administers the contest, awarded it in 2017 to a consolidated TV and digital offering by Star, which outperformed any of the individual offerings combined.

Industry sources expect flexibility from BCCI given the prospects for record payouts by bidders, including a well-heeled digital-only player like Amazon.

BCCI Secretary Jay Shah, in an interview with Reuters, said the board had studied various models and proposals but did not comment on details or the likely dollar value of the offers.

“We will do our best to get the right amount that a tournament like the IPL deserves,” he said.

Disney India did not respond to a request for comment, but Disney CEO Bob Chapek said on a recent earnings call that the company was confident in achieving its subscriber targets in India even without IPL rights.

Sony’s entertainment unit in India said it would consider proposals for broadcast and digital rights.

Some in the industry, however, are questioning the steep rise in the cost of rights and whether it is sustainable.

“The IPL has reached a stage where it is now too big to fail and therefore everyone in the ecosystem is supporting it,” said advertising industry veteran Meenakshi Menon.

© Thomson Reuters 2022

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