Their fierce battle for control of a bankrupt Indian retailer is far from over, and two of the world’s richest men are already heading into the second round of their contest – this time on the cricket field.
Petrochemicals and telecommunications tycoon Mukesh Ambani is expected to compete for the broadcast and streaming rights of the Indian Premier League through his flagship Reliance Industries Ltd, going up against a rival bid by Amazon.com Inc. Both Amazon president Jeff Bezos, the world’s second-richest man, and number 9 Ambani, want to dominate India’s large – and still highly informal – retail industry. In that direction, what better route to commerce than cricket, which is the national passion of the country’s 1.4 billion people?
IPL It’s as big business in India as it is a fad: Last year’s edition had a total viewership of 242 billion minutes. In 2017, Star Sports, the previous winner of a five-year deal for television and digital rights, paid $2.55 billion to a Rupert Murdoch-led. When Facebook Inc got involved, offering $600 million to livestream the matches, the Australian-born media mogul got a warning shot at how quickly the media landscape was changing. He went on to launch his 21st Century Fox Inc. The property was sold to Walt Disney & Company.
Now owned by Disney, Start Sports recently sold a 10-second TV spot for over 1.7 million rupees ($22,000). Add to this the subscription and advertising revenue from the Disney+ Hotstar app, where matches are shown live, and the current tech — as well as the growth potential — could easily justify a winning bid of over $5 billion this time around.
Cricket leagues are a testimony to the growing number of consumers in the emerging market. Amazon’s Prime Video will get an edge over Netflix Inc and Disney in India if it can nail the streaming deal. It doesn’t matter to the Ambanis, who want their own consumer empire to sit atop the three pillars of automobile, material and commerce. With over 400 million customers, Reliance’s Jio is the largest telco in the country. As his customers burn through their data plans to watch cricket, Ambani sees an opportunity to capitalize on his love of the game to not only earn advertising dollars but also sell them more stuff – provided the eyes are on the right track. Stick to media properties instead of your competitors. ,
And Amazon, which livestreams English Premier League soccer, is one of those rivals. Reliance failed to sit in the driver’s seat at Zee Entertainment Enterprises Ltd, the country’s largest publicly traded TV network. Instead Zee is tying up with Sony Group Corp. No problem. If Ambani can take on Zee-Sony if he secures the rights to India’s Super Bowl, there’s now a very real possibility that he’ll reportedly join Murdoch’s son James and his trusted lieutenant Uday Shankar, former Star TV The Indians have been in talks with the boss for 39 years. 18% stake in Viacom, Reliance’s local television-content joint venture with ViacomCBS. Sony will also bid for IPL. If Americans can adopt the game of the then British Empire, so can the Japanese.
Ambani’s involvement with cricket goes beyond media rights. He also owns Mumbai Indians, whose five title wins have made it the most successful IPL team since the league’s inception in 2008. The franchise gives Ambani an opportunity to introduce his kids to the art of buying players on a budget, engaging them in the more massive capital allocation decisions that await him as the 65-year-old passes the leadership of his empire. get ready to do. Next Generation. Control of the team also qualifies the Indian businessman for the title of richest sports team financier on earth. Depending on share prices, that crown continues to pass between him and former Microsoft Corp CEO Steve Ballmer. The owner of the Los Angeles Clippers, a professional basketball team, was Ambani’s classmate at Stanford University’s business school. (Both dropped out.)
India’s media has dropped Alphabet Inc’s YouTube and Apple Inc from Meta Platforms Inc (formerly Facebook) as potential contenders for media-rights auction on June 12. Since Alphabet’s Google and Facebook have equity stakes in Jio, it is doubtful whether they will want to enter an overcrowded bidding war. Apple is busy with Major League Baseball in the US right now, and needs to sell more phones in India before it can monetize Apple TV+. Netflix is looking to stabilize its core business after losing 200,000 subscribers in the first three months of the year. India will not be of much help to its falling stock as it cannot yet deliver rich-country pricing.
Ambani, Amazon and the current Disney are the most obvious expectations. Viewer fatigue with the match format, which has led to a drop in ratings, poses the biggest risk to successful bidders for domestic and foreign TV and digital rights. For Ambani and Bezos, however, the game is about much more than just advertising dollars. A large captive audience for 65 days a year, five years in a row can do wonders for its own offline and online retail ambitions in India. This is the reason why everyone is considering the pair of these two as the most aggressive.
Reliance has taken physical control of several stores of the unprofitable Future Retail Ltd, which agreed to sell its assets to Ambani in 2020 to repay creditors. Amazon is trying to stall the deal for alleged breach of contract as Future’s founder took money from the e-commerce giant, promising not to sell the business to Ambani. If that legal battle is any guide, June 12 should entertain audiences for its money.
Andy Mukherjee is a Bloomberg Opinion columnist covering industrial companies and financial services. He was previously a columnist for Reuters Breakingviews. He has also worked for The Straits Times, ET Now and Bloomberg News.
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