Home / Industry / Media /  Viacom18’s free IPL streaming queers pitch for rivals

NEW DELHI : With Viacom18 planning to live stream the 2023 edition of Indian Premier League (IPL) free-for-all on JioCinema, rival video streaming platforms and broadcast networks are likely to face some pressure on their ad revenues, said experts.

Networks, especially those driven by advertisements, will be hit as macroeconomic situations remain under stress and firms may have to cut their ad budget. The subscription video-on-demand (SVoD) market, which is still in its nascent stage, will find it challenging, and the competition is likely to get skewed toward larger players when a premium property is made available for free. The move will also hit traditional broadcasters, especially Disney Star, as spending will split between television and digital. Though, experts said the mass market reach of Viacom18 cannot be doubted. Disney Star is targeting to reach out to 500 million consumers during the upcoming IPL on TV, while JioCinema is likely to reach 550 million, said experts.

“It’s difficult to see any other AVoD OTT platform managing to sell its inventory during the tournament, much like what happens to other television channels as long as the IPL is on," an executive at a rival streaming platform said.

The IPL will be a litmus test for how far Indians adopt connected TVs. It is also the biggest property for companies to capitalise on in terms of advertising, the person said. “Most rival OTTs offer annual subscriptions that users may already have taken so those may not be impacted but given the limited time consumers have, viewership will dip during IPL, as it remains a priority," he added.

An Elara Capital Ltd report said the domestic digital video ad market is 130 billion, accounting for 30% of the digital ad pie, dominated by social media and aggregators like YouTube. This leaves a mere 15% for broadcast and other OTT players. This would make it difficult for Viacom18-JioCinema to recover even 30-40% of its acquisition cost via digital, if the content is free at least in the near term, over the next two years. Providing IPL free could have a negative impact on TV advertising and on TV medium consumption, given that TV is subscription-based, the report added. Jio will woo larger audience than Disney+Hotstar, considering that it had charged a subscription fee for its platform.

JioCinema and Disney Star did not respond to Mint’s queries on the possible implications of free IPL streaming.

Anuj Gandhi, media analyst and founder of Plug and Play Entertainment, a media tech start-up agreed Viacom18 is going after connected TV audiences with this strategy with the category emerging as the future for the next two to four years. “There will be an impact (on rivals) as premium ad dollars would go to connected TV advertising while the bottom end would look to target mobile screen viewers," Gandhi pointed out. That said, JioCinema would need to build a more robust slate of originals if it intends to stay in the game. “The IPL will help increase engagement but without movies and originals, it could be a one-off," Gandhi said adding that the AVoD consumer tends to be flimsy unlike the SVoD viewer who comes back.

To be sure, several media industry experts remain optimistic about the strategy. “Since IPL will stream for free, it will lead to the addition of viewers. Also, knowing the Jio ways of working, they will ensure that it reaches the broadest possible audience and penetrates deep into the geographies. It may not be profitable in the first year itself but their focus would be more on trials and boosting reach than the subscription revenues," Sujata Dwibedy, chief investment officer, Amplifi, dentsu India said. “On the other hand, the advertising spends are ROI-driven now, and the startup funds have dried up so advertisers will ask for rationale and value for the rates. The usual sponsors will be a part, though some of the new start-up tech platforms may withdraw," Dwibedy added. She pointed out that with the NTO(new tariff order), consumers have anyway been selective in their channel subscription buys and sports is one of the most expensive genres. “Many households used to specifically pick it up during IPL or World Cup. Viewers usually prefer the free option so there will be an impact," Dwibedy said.

To be sure, pay-TV subscriptions in India have contracted and have remained under pressure, agreed Mihir Shah, vice-president at advisory, consulting and research services provider Media Partners Asia. “With the 2023 edition of IPL made available for free on JioCinema, paid subscriptions both on television and digital will find it even more challenging to grow. However, Jio’s splash in the advertising arena will help expand the AVoD market, which otherwise is facing macroeconomic headwinds. The platform, though, will have to deliver a flawless viewing experience and build for record viewing concurrency," Shah added.

Lata Jha
Lata Jha covers media and entertainment for Mint. She focuses on the film, television, video and audio streaming businesses. She is a graduate of the Columbia School of Journalism. She can be found at the movies, when not writing about them.
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