MUMBAI: You have to give it to the bid management team at Rupert Murdoch’s 21st Century Fox owned Star India and Star Middle East.
The bids that Star placed to secure audio-visual rights for ICC Events from 2015 to 2023 were smart on the money. A marked difference from the “panic bidding” that ESPN Star Sports engaged in to commit an unviable $985 million to secure the Champions League Twenty20 rights in 2009, which has been a financial albatross around the network’s neck ever since.
Coming to the numbers for the ICC rights. It turns out that Star’s final winning bid was not $1.9 billion, as SportzPower had initially been informed, but $1.81 billion.
The socond highest bid, incidentally, was not that of Sony Multi Screen Media, but came from Harish Thawani controlled Neo Sports Broadcast. While Sony MSM bid $1.4 billion (broken up as $950 million for India territory and $450 million for international), Neo’s bid was $1.695 billion ($1.245 billion for India and $450 million international).
Neo’s India territory bid was in fact such that if the ICC’s separate territory bids had toted up to more than $1.81 billion, Neo might well have walked away with the India rights.
Why? Because Star’s winning bid of $1.81 billion was broken up as $1.1 billion for India (by Star India) and $710 million for international (by Star Middle East). In a related development, it is also worth noting that there was also a bidding war going on in the UK for the UK territory rights between BT and Sky Sports.
Ultimately Sky committed a massive $200 million to Star for the UK territory rights, which should ease Star’s burden as far as managing the rest of the international territories it has rights to are concerned.
Which brings us to another interesting observation. Whatever may be the public pronouncements coming from the ICC Business Corporation (IBC) board, ICC’s commercial arm, regarding the price cricket’s world body secured for its marquee properties, the final numbers have fallen way short of what was projected in the business plan that was presented to the other boards regarding the new revenue share model pushed through earlier this year by the BCCI, Cricket Australia and the England and Wales Cricket Board (ECB), which now control ICC’s finances and executive powers.
All the “lesser boards” that had bought into the plan that India will receive the lion’s share of ICC revenue and, to a lesser extent, England and Australia, and then “down the ranks” had been presented some very aggressive projections. As SportzPower has already reported, the numbers that were being talked up by the ICC’s bid management team were in the $2.4 billion range for the media rights and anywhere between $300 million and $600 million from sponsorships.
So the best case scenario as per the business plan was a massive $3 billion all told as revenues from accrued for all ICC Events from 2015 to 2023. By SportzPower’s reckoning, the ICC will be off that projection by close to $1 billion.
For the record, as per ICC’s new revenue distribution formula, BCCI stands to earn 22% of ICC’s gross revenue and a further 4% of its profits.
