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Viacom18 Reportedly Wins IPL Cricket Streaming Rights in India, What Does That Mean For Disney+?

Tom Wilton

It is fairly well accepted that live sports rights are one of the main drivers for many consumers when it comes to their streaming or broadcast subscriptions of choice, but domestically, very rarely do we hear of cricket being a major influence on those decisions. However, that is not the case in India. During the 2019 Men’s Cricket World Cup, a game between India and Pakistan attracted more than 320 million viewers across linear TV and streaming services.

Disney took control of the Indian broadcast rights to the incredibly popular Indian Premier League (IPL) when it acquired a majority of 21st Century Fox in 2019. Those IPL rights were one of the key factors in Disney+ becoming such a success in the country, attracting over 50 million customers to date. Operating as Disney+ Hotstar in India, cricket has been a major driving force in the global expansion of the streaming service as it shoots to hit 230-260 million subscribers worldwide by 2024.

However, those long-stated goals could be in jeopardy. Disney’s streaming rights expire at the end of the year, and the league is currently in the middle of an auction to determine what company or companies would gain certain portions of the rights. On Monday, an unconfirmed report from the Times of India indicates that Viacom18 has secured the league’s streaming rights for $2.6 billion. The total IPL package is expected to fetch between $6 billion and $8 billion including broadcast TV rights, which Disney reportedly secured for $3 billion.

In addition to Disney and Viacom18, Sony and regional media and telecoms conglomerate Reliance Industries, are said to also have put in bids. Amazon had been in the running for the rights but pulled out when the price tag got too expensive.

If it’s true that Disney has already failed in its efforts to retain the IPL’s streaming rights, Wall Street may not be too concerned. “Ultimately we think a disciplined approach to these rights makes sense, even if Disney loses the IP,” Morgan Stanley media analyst Benjamin Swinburne recently write in an investor note. “It will likely put downward pressure on Disney+Hotstar subs and maybe put Disney’s fiscal 2024 guidance at risk, but the profit potential out of India is minimal in most scenarios and we do not see this materially impacting long-term earnings power.”

While Disney no longer having IPL rights will almost certainly impact their overall subscriber numbers, it will likely increase the company’s average monthly revenue per paid subscriber total, which analysts have been more intently focusing on recently. Internationally, Disney+ averages $6.35 per user every month when not including Hotstar subscribers. When those accounts are factored in, it drops to $4.35.

On average, Disney+ Hotstar accounts for 50.1 million subscribers, but only $0.76 per user monthly. So many have questioned whether a multi-billion dollar investment in the IPL rights was worth it beyond touting subscriber totals.

An official announcement regarding the IPL rights is expected soon, and if Disney has in fact shifted its stake in cricket broadcasting from streaming to traditional TV, that could be very telling as to how the company plans to move forward with its content spend in countries in which it cannot maximize subscription revenue.

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