Cricket – a game played on the greens with men in various colours battling it out with a bat and a cherry. And watched by billions of viewers worldwide. And the Rupert Murdoch-owned 21st Century Fox’s Indian arm Star India once again reaffirmed how much it is committed to the game when the Board for Control of Cricket in India (BCCI) announced that it had agreed to become the title sponsor of the men in blue for the next four years.
It already has the television, internet and mobile broadcasting rights to domestic cricket, it made a lucrative offer to become an associate sponsor of the IPL, and is investing in different language streams of commentary and channels for the game, and what have you. Clearly, apart from entertainment, sport is coursing through the management’s veins in India.
Indiantelevision.com’s Seema Singh spoke to Star India COO Sanjay Gupta on the reasons behind the sports drive, the title sponsorship of team India, the challenges that lie ahead in monetising all its investments.
Excerpts:
What was the need to take the title sponsorship of the Indian cricket team? How many days of cricket will be played from 2014 to 2017?
It is a very important sponsorship for us. Cricket helps build awareness of brands and associations and we are seeking value coming from both. It is a serious value that we see as a business and hence this sponsorship. Broadcast right gives us the opportunity to put TV ads on air. What the Title Sponsorship gives us is the name on the jersey, which is a very different asset. So now we can put an ad and also logo on the jersey. So in my mind, the way we are using it is that the jersey will be used to make the Star brand more salient in our viewer’s minds. Approximately 100 or more matches will be played in this period.
Are you planning on any innovation as compared to Sahara, the previous title sponsor?
We believe that sport is an asset that can be used for building and marketing brands in a very effective way. This hasn’t been exploited so far in India, as compared to sports globally.
Our aim is to reinvent sports and we spoke about this when we said ‘refresh sports.’ We thought of adding non-live content and we wanted to do it in Hindi.
We would be using Star brands, and it could be Star Sports, Star Plus or Life OK, which could find its presence on the Indian jersey once our sponsorship commences. We would like to build our brand in a very effective way using this association.
When Sahara sponsored the Indian team, it never put any money on television. But, we believe that the combination of putting money on television and sponsoring the jersey could be a great innovation to build stronger brands. We will get a multiplier with television.
When the jersey has a Star Plus logo, viewers will also be informed about Star Plus shows and what the channel stands for.
Are you allowed to change the cricketing gear as part of the title sponsorship deal? If yes, are you looking at changing the look of the jersey?
The jersey’s look is the call of BCCI. Since we are the title sponsor, the jersey will now have our brand name. We are looking at using multiple brands on the jersey depending on the need. So we could start with Star Plus, and after a year think of putting Life OK’s logo on the jersey.
With Star India banking getting its hands so deeply embedded in cricketing, there is a perception of a monopolistic setup coming into the picture? Your take on that.
In my mind, if I look at cricket content, it is very equitably distributed amongst all the three sports channels. So, while we have the BCCI content, Sony runs the IPL, which is the biggest cricket tournament. Besides this, Ten Sports has the rights to South Africa, West Indies and the Sri Lanka series.
All the three brands have strong cricket content. This makes it interesting, since having cricket on all platforms makes it reach larger audience base and in turn builds sports in the country.
Many feel that cricket is overvalued, then why is Star investing so much on the sports?
In my mind, cricket is undervalued. If you see all pieces of content: drama, sports, news, Bollywood, the content which has the biggest affinity and reaches the largest audience is cricket. 64 crore people watched the sport last year, which is higher than any piece of content and this cuts across all regions and languages. So cricket according to me is not at all overvalued.
Sports help build brands, not locally, but nationally. And most people who today look at building brands are looking nationally and not only in select states. Anybody who feels that cricket is overvalued and doesn’t have power, needs to see its power through its reach and the impact it has on consumers.
I personally feel that the sports content has been limited to English language and a few people. So taking sports deeper into regional market is essential and this hasn’t been done so far. |
The biggest heroes are the cricketers of the country. They are young talented people, performing well. Investment in sports and cricket is justified.
You can never get enough of good quality sports and content; viewers will always want more.
Will you be backing other sports and diversifying your sports portfolio?
Yes! We want to. We think cricket is the main stake, but we are not a single sports nation. There is a large followership of football. We are investing in football and hockey in a big way. We are going ahead and investing in Hockey India League. We have already shown our intent in badminton, by sponsoring the Indian Badminton League. We will invest money in all sports.
Cricket was the one sport where we were not the partners. Now we have invested in that as well.
With India losing on foreign grounds, do you see that as a problem for your investment and viewership?
No, I don’t. I have high level of confidence that both sport in general and cricket in particular, will have its following and deeper engagement. We have opportunity to perform better even outside and it is not that we haven’t performed. In England we did well. We performed well across best teams and across best seaming pitches. It is a phase in any team. But fundamentally, I feel that Indian team is performing dramatically. The game of cricket has got deeper in this country. All these new cricketers are from smaller towns. Even younger generation now feels they can be a part of team. The coming in of IPL has just deepened that desire of becoming a part of the team.
What is needed to monetise your investments in sports? Do you think digitisation will help? Even if it is not proceeding as smoothly as you expect?
I personally feel that the sports content has been limited to English language and a few people. So taking sports deeper into regional market is essential and this hasn’t been done so far. So to fortify sports we want to reach out to different regions and into other sports, beyond cricket. We want to make sports big for every member of the family.
Monetisation of sports is a challenge, given there is very limited transparency in terms of numbers given by analogue distribution system. I think, with digitisation we are seeing that changing over the next few years.
Yes, there is a challenge with the MSO vs LCO tussle. But, I am an optimist and I feel there will be a better tomorrow than what is today. Also I think the overall content and media market is growing so much that every stakeholder has a potential to earn and earn reasonably and in a fair way.
So, I see a very fair distribution of income and every stakeholder: MSO, LCO, Broadcaster will earn a fair amount. The reality is that of the 140 million cable TV homes, already 70 million are digital between DTH and cable, which is a big leap in two years time. This market is large and is growing fast. Though there are hiccups, I am confident that things will be better.
Digitisation will ensure that every household is well connected with a transparent set top box, a measurement system which is more transparent and fair money will exchange hands. I don’t know if it will happen in couple of months, but I am sure that in the next three to five years, life will be dramatically different.
But the time is limited between the sponsorship, the broadcast rights and digitisation. What if there is a mismatch? How will you recover investments?
Our sponsorship is a way to build our brand. We have an opportunity to make our brands bigger. As far as the broadcast rights are concerned, we will work towards resolving issues on the ground and related to monetisation as we move forward. Yes, I agree there is a risk, but we believe there is a reasonable risk and hence the investment.
Is your associate sponsorship continuing for the IPL? Also would you take the broadcast rights once the rights for Sony expires in 2017?
We had taken the rights for three years. So it will continue for two more years.
As for the broadcast rights, there is nothing definite right now. We have invested a lot of money in sports already and we would like to see some returns first, before we make up our mind if we want to invest more. The big question for us today is how to ensure that the big investments we have made start reaping results.
Our commitment made in rights is close to Rs 20,000 crore. It is a huge bet. We need to now unlock value and how do we take content deeper and also invest in more sports.
Are you seeing an uptick in Star India’s ad revenues?
Overall the mood in the economy is not very buoyant and I think everybody this year has been very careful on where they are investing. However, as we move forward, people will look at building their brands, so they will spend on advertising as it helps build strong brands. We will have bilateral discussions with brands. We are excited about the future.
Growth rate in this country will not be less than 4.5 to 5 per cent in the next few quarters. And it may get better depending on the policies, with the party coming to power.
Star India is seeing a very healthy growth rate, much ahead of what the market is seeing. I think the market will in the next seven to nine months grow at 10-12 per cent and we are significantly ahead of that in terms of numbers.
Is there scope for sports viewership to grow in India and what is the advertising revenue earned through this reach?
The sports channel viewership is approximately 4 per cent in India, while that globally is 15 per cent. We think there is a scope for growth and Hindi and other regional language commentary will help achieve that growth in reach. Of the total advertising revenue, sports amounts to 10 per cent revenue share.
In a bid to refresh its content and reach out to more Urdu speaking people, six more bureaus in Mumbai, Bengaluru, Kolkata, Lucknow, Patna and Hyderabad were added to the previous two in Delhi and Srinagar.
