For Star India, IPL media rights auction was a ‘win all or lose all’ deal, says CEO
Star India CEO Uday Shankar says the rationale behind the global bid for IPL media rights was expanding HotStar globally
New Delhi: Star India CEO Uday Shankar on Sunday said that the IPL media rights auction was a case of “getting everything or losing everything” for the company, which paid an eye-popping Rs16,347.50 crore in a landmark deal.
“We were either prepared to get everything or lose everything. It feels good because at Star, when you try for something you want to succeed,” Shankar said. Asked if it was a technical battle where Star outbid Sony despite being nearly Rs4,850 crore short in India (TV) broadcast bid, Shankar tried to put things in perspective. “Well, it might sound technical but I think BCCI created a brilliant strategy to maximise its value. Because what they did was, they realised by unbundling the IPL media rights (segregating verticals and areas), they could get interests of people to focus disproportionately on the most relevant piece of right that they wanted,” Shankar said.
Sony’s singular bid for IPL TV rights was Rs 11,050 to Star’s Rs6,196 crore. Sony, without so much of a digital presence, put its whole budget while Star bid in every segment even at times when it was functional, which showed that it was ready to diversify in terms of verticals (broadcast and digital) as well as areas.
Similarly, Facebook Inc. came up with a monstrous Rs3,900 crore India digital bid only.
“Our strategy was very simple. We felt we are the only bidders, who have a presence in TV broadcasting and also robust presence on digital platform (via HotStar). We have a good distribution of Star Channels internationally and we want to role out HotStar globally. We thought IPL could be a device for that,” Shankar explained the rationale behind the global bid for IPL media rights.
“So we felt that instead of putting money on one or two segments disproportionately, individually, if we got only one right, the value that we put would have been a reflection of our reluctance to own one piece. So, we were prepared to either get everything or lose everything whereas others focussed on specific areas of interest. We wanted to get India as well as global rights so that we can unlock a better value for our business. Even if we have been marginally off in any of the segments we would have lost it,” he said.
Shankar admitted that some of the bids like Rs65 crore for Middle East (where BeIn Sports bid 330 crore) or Rs17.88 crore (where FollowOn bid Rs 70.01 crore) for Australia and New Zealand were functional. “Yes, (on functional bids) but on the other hand, from BCCI’s point of view, it was the case of price discovery and yet they have managed to get more from consolidated bids than they could have got from the some of parts (Rs15,819.51 crore). That is a very interesting aspect.” PTI
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