ICICI Securities on Media sector.
This month was marked by two significant events in Indian sport broadcasting industry: 1) The Supreme Court restrained Prasar Bharti from giving live feed of sport events of national importance to cable TV and private DTH platforms; and 2) Star India won TV and digital broadcasting rights for IPL for Rs163.5bn. With sport viewership in India largely dependent on cricket, we believe the ownership of IPL and key BCCI rights puts Star India in position of advantage .
· Supreme Court decision a big boost for Star Sports: The apex court’s decision to stop live feed of key sport events to cable TV and private DTH platforms effectively means that a cable TV or DTH subscriber can watch Indian cricket matches only on Star Sports channels. This will result in a significant increase in viewership of Star Sports and its ability to price channels as pay-TV subscribers will no longer have access to free cricket.
· Star India bags IPL rights amid eye-popping bids: Star India won global TV and digital broadcasting rights of IPL for the next five seasons (2018-22) for consolidated bid of Rs163.5bn. Among individual bids, Sony made a bid of Rs110.5bn for India TV rights and Facebook made Rs39bn bid for digital rights. On per year basis, TV broadcasting rights were sold at 2.5x the value in comparison to the 2009 auctions, while digital rights were bid at 13x the value from the last auction.
· Star leads in non-cricket properties as well: With IPL rights in Star India’s kitty, the company holds rights of all major cricketing events such as ICC and BCCI events and IPL. In addition to cricket, Star India has rights for key sport leagues such Pro Kabaddi League (PKL), India Super League (ISL), Premier Badminton League (PBL) and Hockey India League (HIL) among others. This largely leaves Sony with rights for international football, tennis, basketball and some cricket boards via its acquisition of Ten Sports.