Decoding the numbers behind Reliance backed Viacom18’s bid for IPL digital media rights
The IPL Media Rights auction generated staggering numbers. The numbers were so crazy that they made IPL the second most popular sports league in the world, second only to the NFL.
As we entered and exited the auction, one thing became very clear. The bet on digital is huge. Viacom-18 bagged the rights by paying a massive amount of Rs 20,500 cr for Package B and also paid Rs 2,991 cr for 18 non-exclusive games per season.
The per game bid for TV was Rs 57 cr. For Digital, on the other hand, the number came in at Rs 48 cr. The fact that the offer for digital is as close as it has finally been to television is due to several reasons.
Sports & OTT
According to a report by Ernst & Young, Indians spent the most time on online sports in the world – over 1.5 billion hours. The time spent in India is equivalent to a third of the global time spent on sports apps. Time spent increased by more than 52%.
In 2021, 40 million households in India paid for 80 million OTT subscriptions. Sport has been a major driver of this push. All of these numbers are staggering. But here is the monstrous. Digital sports ad spend grew by more than 100% in 2021. It grew from $5.5 billion in 2020 to $11.4 billion in 2021.
OTT – The Numbers Game
According to Statista, video subscription revenue is expected to reach Rs 83 billion by 2023, and India’s digital market value is expected to reach INR 424 billion by 2023.
The subscription video-on-demand market is expected to grow 52% by 2025, according to uscreen. The majority of OTT platform revenue comes from advertising. Having a property like IPL for 5 years, and all the numbers pointing to monstrous growth in the segment, the bid is justified.
The scale is huge. And with almost everyone having access to a smartphone, the sky’s the limit.