BCCI to allow consortiums to bid for media rights

The Board of Control for Cricket in India (BCCI) has made a significant policy shift by allowing consortiums to participate in its bilateral media rights auction. This marks a departure from their previous stance, where consortiums (a collaborative group of multiple businesses or banks working together towards a common objective) were not permitted to engage in media rights bidding, even excluding them from the Indian Premier League (IPL) media rights auction last year.

While the immediate rationale behind this policy change remains unclear, it seems to potentially favour Sony Pictures Network India and Essel Group (Zee Network), who have been actively pursuing a merger. In business terms, the relaxation of the policy enables helps two media companies to form a united front.

At first glance, this strategic move appears well-calculated. The combined forces of Sony and Zee could create a formidable entity, potentially leading to increased value for the media rights. Both companies possess robust linear and digital presences, presenting a formidable challenge to competitors such as Viacom 18 and Disney Star. This advantage might not be as pronounced if they were to pursue separate paths.

The long-awaited merger of Sony and Zee has garnered significant attention within India Inc over the past couple of years. However, the final approval has been hindered by various legal disputes. The latest update suggests that October 1 is a tentative date for the completion of this unification. It is not clear if they will form a consortium but as per the ITT, the BCCI will not mind.

In addition to these developments, the Invitation to Tender (ITT) issued by the BCCI on Thursday (October 3) outlines three key timelines. The auction is scheduled for completion by August 31, with inquiries to the BCCI being accepted until August 16. Technical assessment bids must be submitted by August 28, two days ahead of the auction.

The BCCI stipulates that participating firms must ensure that their incremental bids amount to at least Rs 1 crore. In essence, companies vying for the two packages – India sub-continent linear rights and India-sub-continent digital rights, along with global TV and digital rights – are required to collectively increase their bids by Rs 1 crore. For instance, a bid of Rs 25 lakh in Package A and Rs 75 lakh in Package B would fulfill this requirement, as long as the total reaches Rs 1 crore. If a company is bidding for only one package, the incremental bid must still be Rs 1 crore.

As previously reported, the upcoming five-year cycle, commencing in September 2023, will encompass 88 games. The base price for linear rights is set at Rs 20 crore, while the digital package carries a base price of Rs 25 crore. The BCCI has indicated that if the combined value does not exceed Rs 60 crore – equivalent to Rs 5200 crore overall – the entire process might be reconsidered.

Furthermore, the winning company or companies must ensure commentary availability in five languages, including English and Hindi, with the choice of the three remaining regional languages being at the broadcaster’s discretion.