Financial Daily from THE HINDU group of publications
Friday, Mar 29, 2002
Marketing - Strategy
Sony bags TV rights for cricket World Cup
MUMBAI, March 28
IN the biggest-ever broadcast licensing deal in cricket, Sony Entertainment Television (SET) has acquired the exclusive cable and satellite TV rights for live telecast of ICC Cricket Tournaments to be held from 2002 to 2007.
These rights for the Indian sub-continent were acquired by SET Satellite (Singapore) from Singapore-based Global Cricket Corporation and World Sport Nimbus (WSN).
It covers two International Cricket Council (ICC) cricket World Cups, three ICC Champions Trophies and three under-19 Cricket World Cups.
While announcing the deal, Mr Kunal Dasgupta, CEO, SET, said India was the largest market for cricket. He declined to divulge the size of the deal in monetary terms, but industry sources said the rights were acquired at a cost of Rs 1800-2000 crore. During the period 2002-2007, SET will be telecasting 315 one-day cricket matches across India, Pakistan, Sri Lanka, Bangladesh, Singapore and Malaysia.
The choice was made from several bidders: Sony, Zee, Sahara, Doordarshan, ESPN and Star Sports. The decision was arrived at, based on a preliminary evaluation of the networks' financial capabilities, Mr Seamus O'Brien, Co-Chairman, WSN, said.
Notwithstanding the SET deal, Doordarshan will have terrestrial rights to select matches, which include all India matches, semi-finals and the final. The cost of acquiring the rights will be recovered through a combination of advertising revenues and subscription fees, Sony's overall ratio here is currently skewed at 85:15 in favour of advertising revenues. This contrasts sharply with the ratios in developed economies.
Television advertising spend was reported to have grown at a very sluggish pace last year. "We are expecting an increase in the base of subscription homes as well as advertising revenues. Six years is a long time to recover our cost of acquiring the rights,'' said Mr Rajat Jain, Executive Vice-President and Business Head, SET-MAX. Mr O'Brien pointed out that the 6-year time frame for telecast rights was fixed to offset higher licence fees for ICC with adequate time for the broadcaster to recover its costs.
SET- MAX channel will be showcasing the cricket matches beginning with the 2002 12-nation ICC Champions Trophy.
The event will be played in India, Australia and Sri Lanka.
This will be followed by the ICC Under-19 Cricket World Cup to be played in New Zealand in January 2003 and the ICC Cricket World Cup in South Africa from February 2003.
The World Cup to be played in South Africa in 2003 will feature 14 teams and 54 matches.
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