MUCH HAS BEEN ALREADY BEEN WRITTEN ABOUT Indian media’s biggest executive departure of 2020. The resignation of Uday Shankar as president, The Walt Disney Company APAC and chairman, Star & Disney India, announced October 8, also marks the end of arguably THE defining decade in the evolution of professional Indian sport in the 21st century.
And front and centre in that evolution was the man at the helm of 21st Century Fox’s India business from 2007 on; and his core team that was central to developing and actualising STAR India’s sports vision.
Driving the sports play for the network alongside Shankar were:
Sanjay Gupta, who came on board as Star India COO two years after the Murdochs, in a shock announcement, named Shankar, the then head of their Star News operation, as CEO of the India’s largest media network; Nitin Kukreja, whose onboarding as head of business development happened pretty much alongside Shankar’s elevation to chief executive; and Ajit Mohan, who joined the corporate office in 2012.
STAR India wins BCCI media rights with standalone bid
2012 can also be set as the base year during, and post which, STAR really went BIG on sports.
The first clear DECLARATION of intent on the part of the network was shown in April 2012, when STAR India won BCCI’s media rights (covering television, internet and mobile) for global territories, for the period July 2012 – March 2018, with a bid of Rs 37 billion. What was surprising to many was that it was a standalone bid on behalf of parent News Corp and did not come in from the Asian joint venture ESPN STAR Sports (ESS), as had been the norm for 16 years prior to this.
Commenting at the time, Uday Shankar said: “STAR India would work collabaratively with ESPN STAR Sports to exploit the rights.
“Right now, we have three sports channels — Star Sports, ESPN and Star Cricket to broadcast the cricket on. However, if required, we could explore the launch of new channels.”
It all became clear two months later, however. In June 2012, News Corp took full control of ESS, buying out Walt Disney Co’s 50% stake and thereby ending the 16-year partnership in the region.
“News Corporation’s acquisition of the interest of ESS that we did not already own… furthers our commitment to delivering incredible sports programming to consumers across the globe, and particularly enhancing our position in sports programming in emerging markets,” James Murdoch, News Corp’s then deputy chief operating officer, said at the time.
The acquisition of ESS, which had a footprint across 24 countries in Asia through 25 television networks and three broadband networks, was finally completed in January 2013.
Reliance, IMG Worldwide and STAR India launch Indian Super League
In October 2013, Reliance Industries Ltd, IMG Worldwide and STAR India announced the launch of the franchise based Indian Super League (ISL). With a 40% stake in the ISL, it also marked the only instance globally of a News Corp subsidiary having direct ownership in a sporting franchise.
The ISL kicked off its inaugural season in September 2014 with eight franchise teams.
Fast forward to the present, the ISL is not just the country’s top football league and clearly improving, on and off the pitch, drawing the best of Indian talent, but also becoming a magnet for international players from more established leagues. A case in point being Australia’s A-League, which this year has seen an exodus of players to the ISL.
Commits Rs 200 billion to bring ‘sports first’
In November 2013, News Corp made its biggest bet on the sports genre in India, with a massive Rs 200 billion commitment. Sanjay Gupta termed the initiative as ‘closing the loop’, which manifested with the network declaring Star Sports as a “sports destination” in India.
THIS WAS ALSO THE FIRST TIME A SERIOUS EFFORT WAS MADE FOR A HINDI SPORTS CHANNEL. As Gupta explained then: “In a nation where less than 10% of the population understands English and a much smaller number are native speakers, sports broadcasters have traditionally programmed only in one language – English. Star Sports has seen success in Hindi commentary with Hindi now accounting for 70% share of all viewership in the recently concluded Champion’s League T20 series. The launch of Star Sports 3 takes this engagement deeper – the content, graphics and shows will all be in Hindi.”
Taking that logic further, STAR took its sports channels into many more languages beyond Hindi, such as Tamil, Bengali, Marathi and Kannada.
Investment in excess of Rs 15 billion in hockey
Two months after the announcement of a Rs 200 billion commitment towards sports development as a whole, the network declared in January 2014 that in excess of Rs 15 billion would be put behind hockey over the next eight years in order to promote the game.
Nitin Kukreja, who had been given charge of the sports business in January 2013, said at the time: “We are putting money where our mouth is. We believe hockey has potential for growth but needs certain key ingredients to come together. We believe that a vibrant local league, international events in India including the 2018 Hockey World Cup, world class production coverage are essential ingredients to popularise the sport and help nurture future champions.”
Showcasing ‘The New Face of Hockey’, Star Sports invested over Rs 1 billion in the promotion and production of the second edition of Hockey India League, an unprecedented investment by a broadcaster in any local league in the country with the exception of IPL.
What is the scenario today? While India has become a regular destination for international events, and the Team India rankings are respectable, the last edition of the HIL was in 2017, and STAR’s conviction in hockey’s salience has distinctly cooled, a clear indicator that the sticks game is a hard sell as a media property.
STAR takes 74% stake in Pro Kabaddi
The Pro Kabaddi League (PKL), launched in 2014, was broadcast on Star Sports. It is worth noting here that PKL promoter Mashal Sports, which was founded in 1994 by Charu Sharma (and backed by his brother-in-law Anand Mahindra as co-founder), took almost two decades to get a broadcaster on board.
Following the success of the inaugural edition, the network acquired a 74% stake in PKL.
After its investment in ISL, PKL was the second time STAR became involved in the league directly.
Uday Shankar said at the time, “The investment, completely in sync with Star’s aim to spawn a multi-sport culture in the country, will further help in nurturing India’s sporting talent. We are totally committed to abiding with the vision of Mashal management and all stakeholders of Pro Kabaddi, and will further develop the league in the upcoming second season.”
IOC awards TV rights for 2016 Rio Olympics
In August 2013, the International Olympic Committee awarded media rights for the 2016 Rio de Janeiro Games, as well as other IOC events, to STAR.
STAR India secured the broadcast rights in seven South Asian countries for the XXII Olympic Winter Games (2014) in Sochi, Russia; the Games of the XXXI Olympiad (2016) in Rio de Janeiro, Brazil; and the 2nd Summer Youth Olympic Games (2014) in Nanjing, China.
And when the Rio 2016 Olympics came around, STAR India literally went wall-to-wall on its coverage, dedicating eight channels on a 24×7 basis, broadcast in English and Hindi.
In all, Star Sports and Hotstar together broadcast 3000+ hours of live content from the Olympics.
Hotstar had rolled out 14 live feeds consistently and up to 36 concurrent feeds at peak on the Olympics video player, which was made available to users on demand through the mega event. Central to Hotstar’s offering to sports fans was the rollout of an interactive, data rich Olympic player on the web where users had the option to switch between the live feeds, have access to day wise listing of events and medals tally, and the ability to personalise the experience by following specific countries and sports disciplines.
Sports key to Hotstar’s dominance
If STAR has proved a critical catalyst in the growth of a sporting culture in India, sports has been a critical driver for its VOD platform Hotstar. And while the COVID-19 pandemic has only accelerated the switch to OTT platforms across the world, it is worth recalling that Shankar and his team were much ahead of the curve GLOBALLY among broadcast network’s in seeing the onset of the streaming tsunami. And as a 2018 headline in Forbes perfectly put it: ‘Thanks To Live Sports, India’s Hotstar Is Going Where No Other Streaming Service Has Gone Before’.
The ground was being laid for the launch of Hotstar in 2014 itself, when StarSports.com acquired the streaming rights for the Indian Premier league. The launch of Hotstar in 2014 saw StarSports.com being merged into the streaming service, with the IPL being the “crown jewel” in Hotstar’s content line-up.
For Ajit Mohan, it was live sports, TV shows and movies that spelled success for Hotstar, for which he was given charge, and subsequently named CEO of.
As Forbes noted: “In the absence of any competition, STAR India saw an opportunity to dramatically shape the sports experience on digital. As the leading sports broadcaster in the region, the company wanted to ride the streaming wave when the opportunity arose. And the bet paid off rapidly.
“Hotstar is changing the way hundreds of millions of people consume content in India, especially live sports. With the hyper growth of mobile-first users and increasing number of cord-cutters, Hotstar is looking to not just match, but supersede the traditional broadcast experience. Game on!”
The game is most definitely on. but it was enabled in a BIG way in the wake of STAR India winning the IPL global media rights after committing Rs 163.47 billion ($2.55 billion) for five tears, till 2022.
Not satisfied with that, Shankar and his team bid Rs 61.381 billion to ensure BCCI media rights for the 2018-2023 cycle stayed in-house. STAR had paid Rs 38.51 billion for the rights to broadcast India’s home matches for the 2012-2018 cycle.
As the network also holds the ICC cricket rights for the current 2015-2023 cycle (for which it bid $1.98 billion, 80% more than the previous cycle’s $1.1 billion), STAR concurrently owns the rights to world cricket’s highest priced properties.
There are new owners now running the show at India’s largest broadcast network, operating by a different cultural dynamic and re-examining much of the legacy Shankar bequeathed. Not so coincidentally, he, Gupta, Mohan and Kukreja have all moved on.
But for Shankar and his team, what is of real relevance is that in The Walt Disney Company’s $71.3 billion acquisition of most of 21st Century Fox, the valuation of STAR India as a standalone is estimated to have been somewhere in the region of $17 billion.
POSTSCRIPT: The proof of the pudding is in the eating, the old adage goes. A little over a year after The Walt Disney Company launched its streaming service Disney+, it was the media behemoth’s plans for its direct-to-consumer business that was front and centre at its 2020 Investor Day earlier this month.
That investors were fully on board with the company’s plans was reflected in the shares of The House of Mouse reaching their highest-ever closing price, at $154.43 a share, DESPITE the Disney Parks, Experiences and Products segment recording a loss of $1.1 billion in Q4 2020, ascribed to the fallout from the COVID-19 pandemic.
The company announced that, as of December 2, its portfolio of direct-to-consumer services has exceeded a total of 137 million global paid subscriptions, including 11.5 million ESPN+ subscribers, 38.8 million Hulu subscribers, and a staggering 86.8 million Disney+ subscribers since its launch in November 2019.
Of the 86.8 million Disney+ subscribers, about 30% (or 26 million) are via Disney+ Hotstar in India, Disney International Operations and Direct-to-Consumer segment chairman Rebecca Campbell said during her presentation at the event. Disney+ Hotstar, which was launched in India in April and in Indonesia in September, was built on Hotstar, the streaming service operated by Star India that Disney inherited when it acquired 21st Century Fox.
Critically, Disney+ Hotstar’s strong subscriber acquisitions were driven by the IPL, which was held in the UAE from September 19–November 10.
From an 18.5 million paid subscriber base in September, to 26 million by December. That is a whopping 7.5 million paid subscribers added in just two months, primarily on the back of IPL.
“With a rapidly growing middle class, India is a promising market opportunity and we are uniquely positioned to succeed in the country due to our existing presence with Star TV and Hotstar,” said Campbell in conclusion.
STAR India’s fate is now fully in Disney’s hands. How that fate unfolds in 2021 will be keenly watched.
