As the Zee-Sony merger is announced, the big question is by when the entire process will be completed. The reason for that is the upcoming bid for the Indian Premier League (IPL). The broadcasting rights for this marquee cricket tournament was acquired by then Star India (the company was later bought over globally by Disney) for a five-year period ending 2022 for Rs 16,348 crore.
It is gathered that the bidding for the 2023-27 period will start in a few weeks, with the expectation that the winner will need to fork out around twice what was paid earlier. These are big bucks and it is not clear if Zee-Sony will be willing to pay that kind of money. Sony owned the IPL rights for a decade till it was scooped by Star. Zee was the entity that put in place the Indian Cricket League before the IPL was conceived. That never really took off and since then Zee has been very conservative about its investment in sports, especially cricket. Those familiar with the process think Sony might bite the bullet in a joint bid with the possible likes of Amazon or Facebook. “Sony needs to be clear that the merger with Zee will go through without any hurdles. A situation of winning the rights and then a delay on the merger will be very tricky,” they say.
Cricket, much as being expensive, drives viewership and the IPL sits on top of that heap. There will also be the bidding for the ICC tournaments later in the year, among which are the T20 and the longer version of the world cup. Winning the IPL rights opens up a clear opportunity for five years or a broadcaster runs the risk of losing that window. It is still not clear what Star under a Disney ownership will go about it. The tournament has two new teams and the interest levels are expected to sustain. This is, of course, independent of what Mukesh Ambani will do. He already owns the Mumbai Indians team and recently picked up the LaLiga rights. He is the majority shareholder in Viacom 18 and cricket is needed to propel his broadcasting business.
Not only does the Zee-Sony combine need to decide quickly on putting in the bid but also reduce the risk of a challenging scenario in the future. Time is the key to taking that big strategic decision.
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