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04-03-2012, 08:12 PM #1
Star TV bags rights for Indian cricket
Star TV, owned by Rupert Murdoch, has won the rights to broadcast Indian cricket for 2012-2018. The deal, which also includes internet and mobile rights, was valued at Rs 3851 crores (approximately $750 million) and covers 96 matches. The other bidder - at Rs 3700 crores, or $727 million - was Multi-Screen Media (Sony), which currently owns the rights to the IPL.
The rights cover all international cricket in India, and domestic competitions including the Ranji Trophy and Irani Cup; they do not include the IPL. The first series under this deal, according to a schedule announced on Monday, will be New Zealand's tour of India in August-September 2012; England have a full tour later in the year and Australia arrive in February for a four-Test series.
Under the deal, Star TV will be paying approximately Rs.40 crores (US$7.86 million) for each match, significantly more than the Rs.32.5 crores (US$6.38 million) the previous broadcaster, Nimbus, had to pay for each match. The pricing is in two stages, Farooq Abdullah, chairman of the BCCI's marketing committee, told : Rs 32.2 crores ($6.3 million) for the matches from 2012 to 2014 and Rs 43.20 crore ($8.5 million) for the matches from 2014 to 2018.
"This is a substantial improvement [on the previous contract with Nimbus]," N Srinivasan, the BCCI president, said. "And the BCCI is very, very happy that the media rights have been fully evaluated and now, I think, fully priced."
While the bid was submitted by Star TV, Uday Shankar, the channel's chief executive, made it clear that the rights will be shared with ESPN, its partner in the ESPN Star Sports* joint-venture. "STAR India will work collaboratively with ESPN-STARSports to exploit the rights", Shankar said. "Right now, we have three sports channels -- Star Sports, ESPN and Star Cricket to broadcast cricket. However, if required, we could explore the launch of new channels."
Manu Sawhney, managing director, ESPN STAR Sports, said: "It was decided by ESS that the preferred way for these rights is for Star to bid with the understanding that should they win, they would utilize these rights in partnership with ESS."
The deal gives Star and ESS a virtual stranglehold on marquee cricket events, since they already own the rights to ICC tournaments as well as cricket in Australia and England. The collaboration also owns rights to the Champions League Twenty20.
The board has also cancelled its production rights contract with Nimbus. BCCI might want to own the production rights instead of selling it.
The board was forced to issue a new tender after it terminated its contract with Nimbus in December 2011, claiming the latter had defaulted on its payments. The matter has subsequently been referred for arbitration, with the Bombay High Court ruling that Nimbus must deposit Rs 305 crores (approx US$60 million) with the court as security for the amount the BCCI claims it is owed by the company. Nimbus has also made a counter-claim of Rs 600 crores (approx US$118 million) from the board.
The BCCI's marketing committee set the price for category A games at Rs 31.25 crores per match (approx $6.1 million) plus Rs 1 crore (approx $0.2 million) while category B games were set at Rs 34 crores (approx $6.67 million) plus Rs 1 crore. The contract with Nimbus had a base price of Rs 31.25 crores (approx $6.1 million) per game for each of the three formats purely for the broadcast rights.
The board did attempt to sell the internet rights separately last year, but the tender found no takers at the initial base price of Rs 3 crores (approx $0.6 million) or its subsequently reduced price of Rs 2 crores (approx $0.4 million).