Right to Broadcast Cricket News

If SETMAX, IPL's India broadcaster, wins its dispute with news channels, it could open up new revenue stream for itself

Published: Mar 5, 2010 08:24:16 AM IST

Updated: Feb 17, 2014 02:09:49 PM IST

The Indian Premier League can’t seem to keep itself free of controversies. If it isn’t the Australians, it’s the Pakistanis and political parties. Just when matters died down, Indian news channels have drawn swords against IPL’s India broadcaster: Setmax.

Last week the News Broadcast Association (NBA), representing 34 news channels across the nation, decided to boycott the coverage of the third season of IPL that starts soon, due to its restrictive coverage guidelines.

Opposing the newly proposed guidelines for IPL coverage issued by IPL and Setmax, the NBA stated that IPL/Setmax have arbitrarily refused to abide by their commitment as contained in the 2008 norms drafted jointly by both parties. “In view of this position unilaterally taken by IPL/Setmax, members of the NBA are unable to offer their viewers any coverage in relation to IPL or its proposed matches,” said their official release.

Illustration: Hemal Seth

Setmax is pained by the rampant usage of cricket clippings aired on news channels and sometimes, dedicated cricket programmes using their footage and allegedly robbing them of their channel audience.

The official Highlights are often given a miss. Add to it the fact that news channels tend to get sponsors for their special cricket shows, thus making revenues that the official broadcaster lost out on.
And this gets Setmax’s goat.

Back of the envelop calculations show that Setmax stands to lose Rs. 10 crore throughout the event. Hence it believes that since it has legal rights to the footage, it has the prerogative to set the rules of
the game.

What if IPL/Setmax win the battle?
Lalit Modi, Chairman and Commissioner, IPL, is slowly but firmly inching towards the eventual goal of selling media coverage rights independently or at least its footage to the news channels, thus opening up a new revenue stream. Whether the revenue will be split between IPL and the broadcasters is anybody’s guess, but the possibility exists.

If the IPL and Setmax get their way, the rest of the broadcasters will not be too far behind.

Nimbus Communications, which has bagged the rights to all non-ICC (International Cricket Council) matches to be played in India for four years beginning April 2010 — for $430 million — will also want a slice of the pie.

ESPN-Star has even more reason to sell footage broadcast rights to news channels. It has bought broadcast rights to ICC matches for a period of eight years until 2015 for around $1 billion. It has paid the T20 Champions League another $1 billion for 10 years worth of exclusive TV, commercial and marketing rights.

Between the three broadcasters — Setmax, Neosport (Nimbus) and ESPN-Star — they pretty much run Indian cricket on TV. They will look to make returns on their investment as soon as possible.
News channels on their part are playing the potent card of a public boycott for now, though later a compromise formula shall certainly be arrived at — however with the addition of a few more guidelines to the earlier version.

News channels need the footage to be served to the cricket-crazy nation while IPL and its franchises need the free mega publicity they get from the incessant coverage of the game. But the sparring will go on, for now.

(Read the detailed DLF IPL 2010 News Access Guidelines )

(This story appears in the 19 March, 2010 issue of Forbes India. To visit our Archives, click here.)