IPL ad revenue may top Rs2,000 crore this year: Star India CEO
New Delhi: Uday Shankar, chairman and chief executive officer (CEO) of Star India Pvt. Ltd and the president of Twenty-First Century Fox, Asia, may be a self-confessed cricket fan, but his massive investment in two big cricket properties—media rights for the Indian Premier League (IPL) and the Board of Control for Cricket in India (BCCI)—have been well-thought out business decisions.
Last week, Star India retained BCCI media rights for all cricket played in India for Rs6,138.1 crore, outbidding Sony Pictures Networks and Jio (Reliance Industries Ltd), while last September, it won the television broadcasting and digital media rights to the Indian Premier League for a princely sum of Rs16,347.5 crore.
Both the rights are for a period of five years.
“Although I don’t usually talk numbers, we will exit IPL with an ad revenue of Rs2,000 crore this year,” he said over the phone from Mumbai.
This is much higher than the Rs1,200 crore that the premier cricket tournament is said to have made for Sony Pictures Networks last year.
Shankar expects the property to make money both on digital and television.
“The target is to reach 70 crore Indians with IPL this year. Last year, 41 crore people watched IPL on television,” Shankar said.
Star plans to expand the reach of IPL through the language feeds which offer commentary in regional languages.
Other than Hindi and English, commentary for the matches is now available in Tamil, Telugu, Kannada and Bengali.
“The southern market was completely under-served. We have invested massively in these languages,” said Shankar.
Referring to the several thousand crores of rupees Star has invested in cricket, Shankar said the company has a plan to recover the sum.
“Media thinks that we have overpaid for these rights. But we are a serious, professionally run media company and we have plans,” he said.
“The advertising industry is growing at a healthy 14% a year. Besides, we could grow at a higher rate since we get a leadership premium,” he added.
Television viewership is growing year on year even though the rate of growth for digital media is higher.
And Star India plans to leverage both these for its cricket properties.
Last year, the reach on the opening match of IPL on digital media (Hotstar) was 18 million.
“This year’s opening match reach was 42 million. That’s the kind of growth we are seeing,” said Shankar.
He said that the broadcaster has been investing in developing various sports for television viewers.
“Earlier, sports was a graveyard for broadcasters. Nobody made money because there was not enough sports. It was occasional, sporadic and like a moving circus. That’s not how it should be since all media is habit-forming,” he said.
He claims that after Star got into sports on its own, at least 70 out of the top most viewed 100 shows on television are in sports. Earlier, this number was less than 20.
“That’s the change we have brought about. We have been working on driving sports consumption and have made kabaddi the most watched sport on Indian television,” he said.