The best time to find true value is when there is competition, says ICC
ICC CCO predicts the trend of positive values continuing in the Indian cricket market
After the Indian Premier League (IPL) it was the turn of International Cricket Council (ICC) media rights, which have become 400 % more expensive in India – $3 billion for 4 years from $1.5 billion for 8 years – to show that cricket remains in a very healthy place in India. The ICC expects the valuations to rise further when it takes its events to other markets such as the US, the UK and South Africa.
ICC Chief Commercial Officer Anurag Dahiya attempts to outline what do these numbers mean for the cricket ecosystem while looking back at the eventful media rights India round, which saw Disney Star putting up a giant bid to win TV and digital rights only to sub-license TV to Zee. “The best time to find your true value is when there is appropriate competition in the market,” says Dahiya. Excerpts from the interview…
Have the valuations - double the asking price, exceeded expectations?
We haven’t commented on the valuation. But we believe what we have got is the right value with our new calendar that has more events and the performance they have shown in recent times. It’s become clear that marquee events at the apex of cricket will continue to get results and the value reflects that.
We are talking about the India market but there are only 26 guaranteed India games and 14 knockout matches out of 181. Do you still think it’s fair value?
You can dissect it match by match. But you also have to step back and look at the overall picture as well. We are talking about marquee events where you are crowned world champions. While a standalone non-India match may not matter much, in our events, you see those games rating well and the stature of the matches are a must-have and must-watch for the fans. That’s where it makes a difference to a media platform’s strategy. Something that you subscriber absolutely demands.
How much of a boost do India-Pakistan matches provide to the package, given the two nations don’t play bilateral cricket these days?
The rivalry is always strong whether or not there are bilaterals or not. We haven’t had them for a while. Absolutely, these are peak moments of interest within those marquee games. The last India-Pakistan ICC match at the UAE was the most watched cricket match in history of TV viewership. We keep scaling those highs. That has a massive rub-off on the events for sure. We also have other developing rivalries like Pakistan vs Afghanistan in the last T20 WC at UAE.
Is it content alone or the competitive intensity that fuels these rights in India?
Look, India is the biggest market for cricket and it is finding its true value. But we always say that the best time to find your true value is when there is appropriate competition in the market. If there isn’t, you will flounder. With the level of competition in India and level at which that economy is headed and the plans that different broadcasters have for that country…when it all comes together, that’s helped up to get to the level we should have.
To come after the IPL rights, was it planned or the IPL took a lead?
No, it was all planned in full discussion with the BCCI. We are not in competition with our members. We didn’t want to make it harder for broadcasters, too. We saw the competition in the market for IPL and it was clear to us, that to go next was right. There was no reason to believe the competition wasn’t going to diminish and our view was that it is here to stay. If we go after IPL, it only makes it more attractive for whoever hasn’t been successful in their acquisition strategy, wholly or partly, to look at our rights more favourably.
You also decided to go for closed bidding and not e-auction…
I know there was a lot of noise. But for us the closed bid was always the right approach. Different properties and circumstances dictate different strategies. In an e-auction, you are always looking over your shoulder to see where the others are and what we need to do in response. We thought, let that not cloud your vision. What you have seen with the sub-licensing for example (Disney Star to Zee), it wouldn’t have happened if people were not focused on their own strategies. It ultimately gives the right results for a rights holder or an owner such as us.
We decided to go with an e-auction should there be a second round to bring in some amount of predictability and address uneven information space. People don’t realize that in the past, ICC rights have actually gone through multiple rounds of closed bids. This time we decided to open it up.
Did people not bid for eight years, unsure of the future of linear TV and ODIs?
We had some eight-year offers in India, but they did not meet the mark. The reason we put out that multiplier was that we thought, if we are going to lock ourselves for eight years, we need to get a good uplift. We will be back in the market in the next cycle and I am sure it will give us the right result.
Do these valuations suggest there is a place for everyone? You have got these numbers despite the growth of T20 leagues…
There is place for everyone. You have to calibrate value to the stature of events and that’s what the market will do. However much we would like everything to succeed, the fact remains that the market will determine what to back. It will ultimately have an order of preference and it will support some more than the others. It does set up a positive runway for world cricket, for the ICC and its members.
Will the member boards stand to gain proportionately with the previous revenue-sharing formula?
Without getting into specifics, overall, it means that we have the desired uplift in money which we can invest in the sport. Last year, we unveiled an ambitious strategy…whether it is women’s cricket or moving into new geographies such as US, increasing our digital footprint, more participation around the world, getting into multi-sport disciplines such as Olympics. Having a suitably funded operation to back up all of that is good. Equally, the member boards who need that sort of financing are able to get the funding they need.
Also stepping back, the big picture from IPL and ICC rights is the overall value of cricket in India. Also, we are about to confirm a number of non-India deals in the coming months. The market will see a trend of improved values sustained elsewhere as well. That’s also a good indicator of the good health of our sport. It also augers well for the members, many of whom have to exploit their bilateral rights including the BCCI.
When do you expect to complete rights sale to all territories and what are your expectations?
We will be sequentially going through a number of territories now. Like the US, UK, South Africa, Australia-NZ, we are targeting them by the end of the year. Then we will turn our attention to Middle East, North Africa in the first half of the next year.
Over the last one year, we have been interacting with all the broadcasters and some of the territories have filled us with optimism. Particularly the US for example. We have spent disproportionate time trying to understand what the broadcasters are looking at, to introducing cricket to those who have not carried it before. It’s a nice surprise when they say it is unique and they want to consider it commercially. Whether or not the new players participate in India but there are global e-commerce and streaming companies who are interested in content there. There is a lot of excitement in the competitive OTT space there and cricket offers nice diversity to their subscriber base.
What are your takeaways from separating women’s cricket rights?
I will not comment on values. The objective of separating out women’s rights was never to get a large number for it. The objective was to have a spotlight on them. The tendency otherwise is for people to forget about these events when they acquire the big packages. It becomes almost like a freebie. The heartening thing is we had a tough time selecting who was the best because everyone had excellent plans and we were after the best bid, not the highest bid.
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