Board of Control for Cricket in India (BCCI) president Anurag Thakur is quite clear when it comes to taking decisions that are commercial in nature. Take, for example, the upcoming bidding for television rights for the cash-rich Indian Premiere League (IPL), the rights which are expected to come up for renewal in 2017. Thakur has made his views public. “There won’t be a clause called the ‘right to first refusal’ in any commercial contracts going forward.”
Thakur considers such practice as a favour or an incentive. He has a reason to believe so. Around nine years ago when the then IPL commissioner/BCCI vice-president Lalit Modi was calling the shots on all commercial aspects of the new IPL, he is said to have lured in the host broadcaster Sony Pictures Network to commit $1.1 billion for the 10 editions of IPL telecast by offering the ‘right to first refusal’.
Of course, in hindsight, no one could have anticipated the big commercial success of IPL T20 format cricket that contributes 35-40 per cent to BCCI’s turnover apart from generating an average of Rs 900-1,000 crore on-air revenue for the host broadcasters.
“In future contracts, we will make sure that no such thing is there... and in the last 15 months also, we have not given anyone this kind of incentive or opportunity. We will make sure that in future agreements also, such a clause will not be there,” Thakur said after taking charge of BCCI.
As per the terms and conditions inserted in the contract between BCCI and Sony Pictures Network, the broadcaster in 2008/2009 period was offered the right to first refusal as and when BCCI decides on who to award the telecast rights of IPL eleventh edition onwards.
Simply put, now BCCI will have to ask Sony first for renewing the IPL telecast rights before it can open it up for bidding or float tenders.
BCCI wants to unlock the real commercial potential for IPL’s television viewership. But it cannot do that unless there is an open bidding as there are a number of logical suitors willing to pay top dollars for hosting IPL on their networks. These include Murdoch’s Star TV Network and Discovery Network’s Eurosport. Then there are home grown networks such as Zee Group, NDTV, Network 18, Sun TV Group and others who can get interested in IPL tomorrow based on their past interests in cricket telecast, IPL teams etc.
After all for Thakur and BCCI, IPL should unlock ‘handsome’ and ‘manifold jump’ in revenues whenever the future of IPL activities are discussed in the governing council meetings expected in the next two-three months’ time. Get in line everyone!
BW Reporters
Ashish Sinha is an experienced business journalist who has covered FMCG, auto, infrastructure, tourism, telecom among several other beats. Ashish has keen interest in the regulatory scenario impacting different sectors. He writes on aviation, railways, post and telegraph, infrastructure, defence, media & entertainment, among a wide variety of other subjects.
