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Mukesh Ambani must change the rules of the IPL game – that loses eyeballs

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  • Last month, Mukesh Ambani‘s Viacom18 won the digital rights of the Indian Premier League for the next five years, beating Disney Star to the limit.
  • Reliance will now have to pay a hefty bill for content production, media acquisition, marketing costs and other hosting costs.
  • In addition, the viewership of the recently closed IPL Season 15 dropped 30-35% in its first four weeks compared to last year’s numbers.
  • With viewership dwindling and television taking up the bigger chunk of the viewership tail, experts tell us whether Reliance is getting its money’s worth.

India’s richest man Mukesh Ambani is counting on India’s most valuable sports asset, IPL, to build his content and telecom empire. But IPL has fallen victim to a 15-year itch and suffers from consumption fatigue.

According to a recent survey conducted by consumer data company Axis My India, only 25% of Indians watched IPL this year, and even of those who watched, 65% watched it on TV. Only 29% said they watched it on digital platforms.

Less than a third of the smaller slice of a shrinking pie is what Ambani is left with, as the days of people taking sick leave on IPL days are long gone.

On the contrary, Viacom18 paid a record amount of ₹23,750 crore last month to receive two and a half bundles of media rights from IPL. It beat Disney Star and won the digital non-exclusive digital rights package and a few international countries. It sounds like a lot of money has been paid for something that is no longer a hot item.

Those who have watched IPL have also seen one or more matches this season. IPL season 15’s television
viewers fell 30-35% in the first four weeks from last year’s figures.

“You can witness respondents suffering from consumption fatigue, which could be related to the myriad choice of content, ease of mobility and availability of experiencing ‘cinema’ etc. The craze around IPL continues across all platforms, but whether this excitement justifies the high media rights, time will tell,” said Pradeep Gupta, chairman and MD of Axis My India.

A TV in every home, but a mobile in every hand

However, Girish Upadhyay, the CMO of Axis My India, is more hopeful as rural consumers are looking to IPL on mobile due to cheaper data and power cuts.

“There’s a bigger game that Viacom from Reliance is looking at,” he told https://londonbusinessblog.com/ India. He believes that IPL will bring new users to the Viacom + Jio combination, which will give them a significant advantage in scaling their platforms.

“These new viewers can help build the subscription revenue for the GEC, movies and original content library they have, so IPL can’t just be viewed individually. IPL was never just about numbers in terms of ratings, the kind of impact, the engagement it gives brands is unprecedented,” Upadhyay said.

But a CLSA report calculates that for Ambani’s Viacom18 to break even and equal their bid costs, ad revenue will need to grow 57%. However, experts are counting on Reliance’s spectacular strategies to get ahead in a game where it’s lagging behind.

N Chandramouli, CEO of research firm TRA said that if television has reached every home, a mobile phone has reached every hand.

“That is what makes the digital rights of IPL so interesting for Reliance. We must remember that viewing has become a personal experience these days, not a family experience. While the young children may be watching IPL on their phones or laptops, the parents may be watching the news on TV,” Chandramouli said.

Voot to become a bigger fish in the sea?

In the digital streaming landscape, MX Player, Disney+Hotstar, Amazon Prime occupy the largest market share and Viacom18’s Voot is at a distance of 2%.

BI India


Chandramouli said Reliance is more likely to get its “bang for the buck” as it will significantly increase its paid Voot subscriber audience. This is the same prize game that Reliance played when they entered the telecom market as the fourth player. They gave their mobile subscription three months for free to become the largest player in the market. Six years later, it is still the operator that provides the cheapest data.

The same is also happening with the OTT offering. It is the cheapest OTT on the market that is about to hit a blockbuster – even if its popularity is declining. The digital rights that Reliance acquires will be valid for five years and experts estimate that this will bear fruit from the third year.

“Like it or not, Reliance tends to change the rules of the game in the industries it operates in. Since Jio subscribers will also have viewing rights to IPL, the win is likely to grow Jio customers as well. No other OTT player has such synergies, which gives Reliance an advantage on multiple fronts to take advantage of the IPL win,” said Chandramouli.

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