BCCI took the lead in the race for floating fresh tenders for its TV rights when it announced this month the plans to sell its IPL Media Rights for 5 years starting from 2023. This took the industry by surprise as ICC was trying to get a tender ahead of BCCI. 

The ICC’s last eight-year rights cycle (2015-2023) sold for around US$1.9 billion in 2014. Three years later, the BCCI raked in US$2.55 billion for five-year (2018-2022) IPL rights. Both sets of global rights were bought by Indian broadcaster Star India. The BCCI is expected to get at least 25% more—around US$3.2 billion—for the IPL’s next five-year rights cycle (2023-2027). Since it will be the first mover, it could even get more than that.

This is the first time ICC plans to split the consolidated global bid into territory bids and will begin with India first. The split definitely makes sense as they could break it into different categories like India (television), India (digital), USA, Middle East, etc. and make the market open to more bidders in the process. The current prospects to be in this race are Viacom, Amazon, Disney and the Sony-Zee (combination not announced yet). Any bidder that does not win the IPL will want to bag the ICC rights in order to stay in the cricket rights industry.

The current IPL was won by a consolidated bid from Star Sports India but Reliance Jio, the telecom arm of Reliance Industries, had placed their bids for IPL digital rights and BCCI media rights in the previous round. According to some news sources the losing bid last time was very close to the one made by Star. However for the upcoming round Jio might place a consolidated bid for both TV and digital rights of IPL. The competition for the rights is definitely going to be worth the watch.

IPL’s media rights will be in direct competition with ICC’s events and, ironically, with BCCI’s bilateral series. ICC will go to the market soon seeking broadcasters for the 2024-31 World Cup offerings. Star currently pays the ICC nearly US $ 2 billion for six world events in the 2015-23 cycle. ICC is set to project a solid offering – a world event every year which will include the 50-over Champions Trophy, a 50-over World Cup and the World T20.

In what is a constant tussle for a window in a crowded calendar, BCCI has not been able to stop ICC’s attempts to have a world event every year. BCCI’s intention to seek fresh bids for IPL is being seen as nothing but an attempt to secure the first mover’s advantage. IPL has proved to be one of the most prized advertising cricket events of the year and it would be interesting to see who gets the winning bid this time. 

When compared to other sports, cricket TV deals still look considerably cheap leaving a huge scope for inflation. Cricket is the most popular sport in India, making IPL one of the most viewed sporting event of the year.

What does it mean for Chennai Super Kings (CSK)?

By virtue of the current TV rights, the revenue share of Chennai Super Kings franchises over the 5-year period is estimated be 50% of the total amount per team after deducting the production expenses incurred during the season. The league also signed a major title deal with VIVO for Rs, 2199 crore for the same period (2018-2022). A combination of sponsorship and media rights ensures, the franchise will receive over Rs 1000 crore in the form of central revenue over the next five years from the BCCI-IPL. However, the Franchisees have to share 20% of the income with BCCI.

Competition has one thing about it, higher bid prices are expected this time due to the new entrants, tremendous gain in internet sports streaming, big corporates entering the market like Reliance Jio which owns a major stake in Viacom18 and for the mere fact that IPL is one of the biggest cricket events of the year. With so many players going on a bidding war, the tender amounts are expected to be much this time as the Indian Cricket industry prospers.

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