BCCI bilateral auction: Disney’s exit and the long and short of cricket broadcast rights

BCCI deserves credit for ensuring transparency, by calling for an e-auction.

The Board of Control for Cricket in India (BCCI) on August 31 sold the media rights—both digital and television—for home matches for Rs 5,963 crore. These rights extend to all 88 matches that are scheduled to be played in the five-year cycle of 2023-2028, encompassing both international and domestic cricket activities conducted by the BCCI within the country.

The BCCI e-auction for Team India’s home matches has at least three key takeaways that are yet to receive adequate attention.

1. Unlike the Indian Premier League (IPL) media rights that sold triple the previous value, bilateral cricket rights auction presented a stunted growth pattern and continues to retain a certain degree of charm because it involves the Indian national teams.

2. BCCI deserves credit for ensuring transparency, by calling for an e-auction. They knew the easier thing to do under the circumstances would have been to call for a closed bid. However, they stuck to their decision despite the lure of potential ‘shock value’ the idea of a closed bid presented.

3. It signalled the end of the road for Disney’s India business, at least in the interim. The broadcaster did not arrive at the auction table and the decision once again underlined recent American news headlines about the entertainment conglomerate wanting to sell its India businesses, or at least find a partner.

The rights were sold for a combined per-match value of Rs 67.8 crore with television attracting a per match value of Rs 32.5 crore and digital getting Rs 35.3 crore. Unlike the IPL rights, where digital surpassed the television component in bids as well as in value, in BCCI bilateral, television received more incremental bids than digital (although value remained lesser).

Also Read: Viacom18 wins TV, digital rights for Indian cricket team's home matches for 5 years

Reason: Unlike the IPL, which has been seen as the average youngster’s ‘go-to’ sports property in terms of consumption – data trends suggest a viewership growth among kids between 2 and 14 years was witnessed in the 2023 edition – the BCCI bilateral, which involves the Indian national teams is as much modern-day cricket as ‘old school’ and keeping that in mind, Viacom18 saw merit in buying television, too.

The competition at the auction table came from Sony Pictures (now Culver Max) who stopped at Rs 31.5 crore for television and Rs 34.3 crore for digital before opting out.

After carefully stitching up a vast television network around the length and breadth of the country, that involved a last-mile venturing into regional markets, Disney’s call to completely stay away from Thursday’s rights sale clearly did not happen overnight.

In fact, the beginnings of what has eventually transpired now go back to the sale of two properties last year – the IPL, followed by the International Cricket Council (ICC) media rights.

Almost every quarterly earnings call at the company’s headquarters in Burbank spoke volumes about how India cricket had helped Disney scale up the HotStar numbers – their Indian baby that was making them look so much better in the OTT space, from a shareholder narrative, back home.

The moment Disney lost the digital rights to IPL, basis which the fairytale was getting stitched each quarter on the Wall Street, the company realised it would soon reach a ‘do or die’ situation in the cricket rights market if it experienced another such loss.

In the panic that ensued, Disney decided to bid a disproportionate $3.04 billion (approximately Rs 24,000 crore) for just 179 matches falling under ICC events for the 2024-28 cycle through a closed bid – a lure that BCCI did not fall to – and even as it made attempts to address shareholders that it had offloaded 50 percent of those rights to Zee-Sony combine (television), the narrative had been set.

At 24,000 crore for 179 matches, Disney (along with Zee and Sony, although that deal hasn’t come through yet and all eyes await) technically agreed to pay an approximately Rs 135 crore per ICC match – there are only 26 matches out of the 179 involving India – that has no chance of being recovered.

On August 31, the BCCI did take note of Disney’s willingness to spend on ICC rights for events to be hosted by West Indies and America in 2024 (T20 WC), Pakistan in 2025 (Champions Trophy), India in 2026 (T20 WC) and South Africa in 2027 (50-over WC) even at the cost of not arriving for their own bilateral auction.

“What worries us most is when these ICC rights come up for sale, who’ll be paying $3 billion again and match Disney’s generosity? It’s a grave concern already. That was top on our minds when we decided against a closed bid. We didn’t want our partners panicking and over-bidding mindlessly, because that would only hurt us and our partners more at the end of the cycle. We’d rather have a content partner than a bigger cheque that simply doesn’t make business sense,” BCCI’s leading official said during a conversation.

Now, as Disney reconciles to what’s been lost, and goes back to re-strategizing what it must do next, the onus – for the next five years – must lie on the BCCI to ensure bilateral cricket returns to life and continues to thrive.

Three-day Test matches, poorly scheduled games, abruptly planned white-ball matches, not having ‘big-ticket’ games at historically important cricket venues, repackaging of domestic cricket, etc – it must all be looked into with fresh vigour going forward.

The BCCI has begun well, no doubt. They must now round up a brand-new five-year journey that’ll bode well for the coming rights cycles.