IPL value plummets by Rs 9,800 crore; free streaming faces uncertain future

D and P Advisory predicts that the days of escalating bid prices driven by fierce competition may be behind us.

A valuation conducted by D and P Advisory has revealed that the IPL ecosystem value has decreased by around 11% in 2024, falling from Rs 92,500 crore to Rs 82,700 crore, as compared to last year. 

The report titled Beyond 22 Yards, attributes this decline to the failed merger between Zee and Sony, the merger of Network 18 and Disney Star and the delay in the entry of major tech players such as Amazon, Meta, and Apple into the IPL media rights.

The valuation services provider revised its media rights estimates following developments in 2023. It predicts that “the days of escalating bid prices driven by fierce competition may be behind us, casting a shadow over the future growth trajectory of IPL's media rights valuation.”

Santosh N, managing partner, D and P Advisory, says the next IPL media rights cycle auction will witness certain demand-side constraints as what was expected to be a three-horse race has effectively become a one-horse race.

A merged Sony-Zee had the potential to be a formidable player to bid for IPL rights against Disney and Reliance as independent players — turning the competition into a three-horse race. “Since their union didn’t materialise, the two companies remain small players lacking the capability or willingness to bid for the rights independently.” Meanwhile, Disney Star and Viacom have merged into one entity.

Meanwhile, Women’s Premier League’s (WPL) value has increased by 8% as compared to the previous edition, increasing from Rs 1,250 crore to Rs 1,350 crore.

Santosh explains that in its last WPL valuation, it did not make aggressive assumptions about the media rights increasing significantly. Its assumption was that there wouldn’t be strong interest from multiple media players, and the expected growth wasn’t projected at the same level as the IPL. Therefore, it adjusted its assumptions for the IPL, but not for WPL, as last year’s assumptions still seem reasonable.

“WPL 2022 media rights auction wasn’t a fierce  fight between Star and Viacom; Reliance was the only serious bidder. WPL is also in its early stages, making growth easier on a smaller scale. Therefore, the impact of the merger will be far higher on IPL which is 61 times bigger than WPL,” he adds.

The report suggests that the Board of Control for Cricket in India (BCCI) could consider segmenting IPL media rights, similar to the strategy followed by American sports leagues. Santosh says segmenting media rights can attract more media players into the bidding process.

In 2022, the BCCI split the rights into digital and TV packages for the 2023-27 cycle. Disney Star won the TV rights for Rs 23,575 crore and Reliance-backed Viacom18 bagged the digital rights for Rs 23,758 crore. This allowed companies like Amazon, which isn’t interested in linear rights, to bid solely for digital rights. This increased competition, with both traditional media companies and new-age OTT platforms like Amazon Prime entering the fray, making the bids more attractive to BCCI.

Santosh says BCCI could further segment digital rights by offering different packages—such as league matches, playoffs, or weekend games—rather than selling all digital rights to one player. 

“This approach might attract companies that don’t want to commit to all 74 matches but would aggressively bid for specific segments, like weekend games or the playoffs. This strategy could result in higher overall bids, as companies compete for smaller, more targeted packages. Additionally, it would keep more media companies engaged over time, rather than locking in just one player for the next five years. These innovations could maximise the valuation of digital broadcasting rights moving forward,” he says.

This may prove inconvenient for consumers, who may have to subscribe to multiple OTT platforms to watch a single season of IPL and also be confused about where to watch the day’s match. However, Santosh says the audience is already used to subscribing to multiple OTT platforms. 

“While there might be some inconvenience, consumers will adapt, and platforms will advertise to guide them,” he says.

Though this model is new to India, it’s already happening in the U.S. For example, Amazon Prime has bought the rights to NFL's Thursday Night matches for $1 billion. “It’s a matter of time before Indian media companies adopt similar innovations to maximise value,” he says.

The report states that IPL matches on digital streaming platforms are expected to remain free in the near future. JioCinema adopted a strategy of streaming IPL matches for free,  similar to its successful Jio SIM marketing approach.

“Although IPL matches are free on OTT platforms, the cost per GB of data for streaming is approximately Rs 6. Streaming one T20 match can consume up to 3.6 GB in standard definition, 10.6 GB in high definition, and 26.6 GB in 4K resolution. In contrast, viewers can subscribe to Star Sports for two months of IPL coverage for Rs 38,” the report explains.

Santosh says the free-streaming may change in the future, especially with Reliance and Disney’s monopolistic hold on sports media rights. “They could start charging or putting content behind a paywall. To increase valuations, these services will likely need to transition to paid models—free streaming can't last forever,” he says.