Star India CEO justifies shelling out big bucks for IPL Media rights

Star India, the popular broadcasting company, raised a lot of eyebrows when they acquired the media rights for the next five editions of the Indian Premier League (IPL). The money they shelled out for striking the key deal was a big price and a record one in the history of sports. Star Indian bid INR 16347.5 crore to bag the IPL media rights for time frame of 2018 to 2022. There were many who believed that the amount bid was a little too much.

But if the words of Uday Shankar, the chairman and CEO of Star India are to be believed, then the deal is value for money. In a recent conversation with SportStar, Uday Shankar justified the amount that the company invested in the deal.

“First and foremost the value we have paid for IPL, one should see it from a certain context; we have got the rights for all markets: television, digital and global. We just paid a few hundred crore more (than the combined highest bids for all platforms and territories). SONY paid Rs.8200 crore for the first ten years; this time they themselves were willing to pay Rs. 11,050 crore for five years,” he quoted.

He further explained his point saying that Sony had bid a price less than half the price paid by Star for the IPL because the tournament was untested back then. Now, the world knows about the immense popularity that the tournament has. Also, there is high likelihood of the tournament being promoted on the digital media big time. Hence, there is absolutely no reason why the deal can be considered as a spendthrift one.

“The reason is very simple; ten years ago IPL was untested. India did not have a similar domestic league, with the minor exception of the Calcutta Football League. Cricket was popular then also, but only with the BCCI  (Board of Control for Cricket in India) internationals and ICC (International Cricket Council) international formats. People got IPL cheap then, because it was not tested. Now the IPL has been tested and so has been the digital for some years; it has worked well for Hotstar. So the price is not outrageous. The IPL is a high quality premium property,” he quoted.

“The second thing is, we pay Rs. 43 crore each for a Test match, ODI and Twenty20. If we were willing to pay Rs. 43 crore six years ago, Rs. 54 crore now for an IPL match is not an exorbitant price,” he added further.

On Test cricket

When asked if the popularity of Test cricket is dwindling amidst this T20 explosion, the Star India CEO mentioned that there are hardly any spectators for Test cricket. Hence, it is no surprise that the Test cricket will lose on the shine and glamour that the audiences want. He mentioned he will not be interested in paying the similar amount for Test cricket.

“Given the state of Test cricket, sometime one doesn’t even find one thousand people watching it in the stadium. That should give an idea of what’s the level of interest for Test cricket. If you are not watching it in the stadium, you are not seeing it on television. If one wants to pay the same value that I pay for a Twenty20, it will be tough,” he conceded.