TV rights bidders for PSL fall well short of PCB’s target of $42m

[navin]

TV rights bidders for PSL fall well short of PCB’s target of $42m

Updated December 16, 2018



LAHORE: The Pakistan Cricket Board (PCB) has started receiving bids for the next three years’ media rights for the Pakistan Super League (PSL) but they are certainly not as attractive or handsome as compared to the bids received for the first two PSL editions (2016-17), Dawn learnt on Saturday.

None of the bidders, it seems, have reached anywhere near the US$ 42 million figure mark which is the target set for the next three years.

With the PSL now a hugely popular and established brand and with increased number of matches set to be played in Pakistan, the bids should have been much higher this time but that has not been the case.

According to reports, the offers from the bidders were opened at a meeting that continued till late on Friday night. The tenure of the successful bidder will start from the fourth edition of the PSL which will be commencing from Feb 14 to March 17.

It may be mentioned here that unlike the previous three editions of the PSL, this time, the PCB has decided to sell the media rights, instead of buying specific time of different TV channels to live telecast the matches through arrangements made by the PCB.

When the PCB launched the PSL in 2016, no TV channel was ready to offer a reasonable price for seeking the media rights as the fate of first edition was still hanging in the balance. At that stage, then PCB chairman Najam Sethi and his team had decided to buy the transmission time of three sports channels and made all other arrangements on their own of broadcasting and collecting the commercials which eventually paid rich dividends.

However, now Ehsan Mani’s management has decided to sell the media rights because the TV channels are now showing tremendous interest in purchase of media rights.

While not a single match was held in Pakistan during the first edition held in 2016 due to security issues, the final of the second edition was held at the Gaddafi Stadium which attracted a packed to capacity crowd. In the third edition, three matches - two in Lahore and the final in Karachi - were held and were sellout affairs.

And now the PCB has announced to hold eight matches including the final in Pakistan. It is possible that the future PSL editions may see more matches played in Pakistan and, in that reference, the PCB - by setting a target price of around US$42 million for next three years - is still selling it short.

It may be mentioned here that the PCB’s income through TV rights in 2016 and 2017 had increased remarkably. According to the PCB documents, the PSL fetched Rs 341,324,182 from TV rights in its first edition but the board itself had made all the arrangements for the transmission, the total cost incurred was Rs 232,463,991 with a net income of Rs 108,860,191.

In 2017, the PCB earned a net profit through TV rights to the tune of Rs 257,613,062 as it got bumper commercial advertisement amounting to nearly Rs 531,714,102. The cost was just 274,101,040.

However, no details of the third edition of the PSL, held in 2018, are available on the PCB website but according to an estimate, they could be around Rs 400 million.

Published in Dawn, December 16th, 2018

https://www.dawn.com/news/1451644/tv-rights-bidders-for-psl-fall-well-short-of-pcbs-target-of-42m

 

[navin]

LAHORE: The Pakistan Cricket Board (PCB) has started receiving bids for the next three years’ media rights for the Pakistan Super League (PSL) but they are certainly not as attractive or handsome as compared to the bids received for the first two PSL editions (2016-17), Dawn learnt on Saturday.

[MENTION=2501]Savak[/MENTION]

 

[Sidilicious]

Why change the method that worked for them? If buying specific time slots works for them, still use that. Especially, if the revenue generated is not as high as expected from full TV rights.

As more matches are played in Pakistan, the quality of foreign players will reduce for the first few years, after picking up again when playing in Pakistan becomes normal. So, I'd expect this reduction to be a factor of that.

 

[Bhaijaan]

Wishing PSL and all Pakistan friends best of luck. Hope you secure good deals and are able to also a have a good show on the ground with good participation of talent from all over the world.

 

[Savak]

Why would broadcasters try to low ball the pcb given that the psl has achieved some semblance of stability and some matches are now even being played in Pakistan? They are showing interest and acknowledging interest but want to pay a price even lower than what they paid for the previous psl edition?

One could understand for the first few seasons they would have been nervous about the sustainability of the league, whether the pcb could pull it off and whether it could be played in Pakistan and hence why they paid a lower price back then and that was acceptable to the pcb at the time as it sportingly acknowledged that it had to prove itself first.

But inspite of all pcb faults and imperfections, they have done well with the psl especially given the fact that numerous other T20 leagues around the world have failed and have either not Kickstarterted or continued after the first season.

To me this looks like a classic case of the broadcasters trying to exploit the fact that the pcb has been struggling for a while and dont have a lot of options that a board like the BCCI does for eg.

A guy with an established job searching for another position will have a different mindset compared to an unemployed person job hunting. I wonder what kind of people have been negotiating on the pcbs behalf

 

[cricketjoshila]

Why would broadcasters try to low ball the pcb given that the psl has achieved some semblance of stability and some matches are now even being played in Pakistan? They are showing interest and acknowledging interest but want to pay a price even lower than what they paid for the previous psl edition?

One could understand for the first few seasons they would have been nervous about the sustainability of the league, whether the pcb could pull it off and whether it could be played in Pakistan and hence why they paid a lower price back then and that was acceptable to the pcb at the time as it sportingly acknowledged that it had to prove itself first.

But inspite of all pcb faults and imperfections, they have done well with the psl especially given the fact that numerous other T20 leagues around the world have failed and have either not Kickstarterted or continued after the first season.

To me this looks like a classic case of the broadcasters trying to exploit the fact that the pcb has been struggling for a while and dont have a lot of options that a board like the BCCI does for eg.

A guy with an established job searching for another position will have a different mindset compared to an unemployed person job hunting. I wonder what kind of people have been negotiating on the pcbs behalf

The broadcaster has to factor in the production cost plus the money to be paid to the PCB and then calculate profit. Since pcb only had to factor in the production cost and rest was profit,the two situations are not the same.

 

[Savak]

Am reading on the internet that the pcb requested govt permission to allow entertainment channels to bid for the psl media rights to increase channels for additional revenue streams but the govt denied permission.

This is Ik's govt we are talking about here. Why would he as PM of Pakistan be indifferent to PCB'S plight knowing full well it is the only international sport which puts the nation of Pakistan in the international media spot light.

Extremely disappointing stuff

 

[Angrez Pakistani]

Am reading on the internet that the pcb requested govt permission to allow entertainment channels to bid for the psl media rights to increase channels for additional revenue streams but the govt denied permission.

This is Ik's govt we are talking about here. Why would he as PM of Pakistan be indifferent to PCB'S plight knowing full well it is the only international sport which puts the nation of Pakistan in the international media spot light.

Extremely disappointing stuff

Things like these requires months and months of lobbying. Knowing the history of PCB I can safely say that they didn’t anticipated this scenario and have only now applied for permission. It’s actually the incompetence on part of the PCB.

 

[navin]

so things don't look as rosy for the world's 2nd most popular cricket league as it was being painted.

Franchises are not even able to break even entering the fourth season and now the broadcasters not ready to pay what they did for the first two seasons despite being more matches are going to be played in pakistan

 

[Savak]

Things like these requires months and months of lobbying. Knowing the history of PCB I can safely say that they didn’t anticipated this scenario and have only now applied for permission. It’s actually the incompetence on part of the PCB.

The PCB has had the whole of 2018 to plan for the 2019 PSL. First they waited for the absolute last minute to terminate Schon group just before the draft. Now they are battling with the franchises on Psl revenue sharing at the last minute, leaking confidential documents.

Expected much better from Ehsan Mani. But IK should be more sympathetic to the problems being faced by the PCB

 

[Savak]

so things don't look as rosy for the world's 2nd most popular cricket league as it was being painted.

Franchises are not even able to break even entering the fourth season and now the broadcasters not ready to pay what they did for the first two seasons despite being more matches are going to be played in pakistan

The PCB has many justified reasons to demand a better deal from the broadcasters this time around. The broadcasters are exploiting the monopoly position that they have.

 

[Angrez Pakistani]

The PCB has many justified reasons to demand a better deal from the broadcasters this time around. The broadcasters are exploiting the monopoly position that they have.

That’s the flaw in the theoretical framework of Pakistani society. We believe that by just replacing the head of an organisation will work miracles and improve everything. This would get too political but it’s sufficient to say that things won’t improve through cosmetic changes.

 

[navin]

The PCB has many justified reasons to demand a better deal from the broadcasters this time around. The broadcasters are exploiting the monopoly position that they have.

It's a market-based economy. If the broadcasters are not bidding what PCB was expecting means they don't find it profitable enough at such a high price. You can't blame broadcasters for that, they are not here for charity or nationalism's sake, they are here to recover their money back and expect some profit.

 

[Savak]

It's a market-based economy. If the broadcasters are not bidding what PCB was expecting means they don't find it profitable enough at such a high price. You can't blame broadcasters for that, they are not here for charity or nationalism's sake, they are here to recover their money back and expect some profit.

Do you believe it could be possible that the psl is profitable and worth what the pcb is demanding but the broadcasters want to pay the minimum possible price?

 

[Last Monetarist]

I don't think the PCB should change their model of buying airtime directly from the broadcasters. The only way they make more money à l'inverse is if the large Indian broadcasters like Sony or Star want to bid, which is highly unlikely for both economic and political reasons.

 

[navin]

Do you believe it could be possible that the psl is profitable and worth what the pcb is demanding but the broadcasters want to pay the minimum possible price?

What I think is if broadcasters found it profitable enough at that price they would've bidden it already. The fact that they didn't bid high means they don't find it profitable enough, simple and yes bidders would always want to buy at the minimum possible price.

 

[navin]

BTW which broadcasting company telecasted the first three seasons? Wasn't it PTV?

 

[Last Monetarist]

BTW which broadcasting company telecasted the first three seasons? Wasn't it PTV?

The PCB bought airtime on all 3 sports channels in Pakistan: PTV, Geo Super, and Ten Sports. With Ten's parent company being acquired by Sony, I don't think they have as much clout to spend a lot of money in Pakistan.

 

[Savak]

What I think is if broadcasters found it profitable enough at that price they would've bidden it already. The fact that they didn't bid high means they don't find it profitable enough, simple and yes bidders would always want to buy at the minimum possible price.

In the past the pcb has been accused of corruption and malpractice where they got significant TV rights revenue but informed the public that they got much less than expected and the people pocketed the difference. I hope someone independent thoroughly investigated to ensure no hanky panky is going on.

 

[navin]

The PCB bought airtime on all 3 sports channels in Pakistan: PTV, Geo Super, and Ten Sports. With Ten's parent company being acquired by Sony, I don't think they have as much clout to spend a lot of money in Pakistan.

So why don't they use the same model again this time?

 

[navin]

In the past the pcb has been accused of corruption and malpractice where they got significant TV rights revenue but informed the public that they got much less than expected and the people pocketed the difference. I hope someone independent thoroughly investigated to ensure no hanky panky is going on.

Are you talking about Najam Sethi tenure as PSL started in his tenure?

 

[Savak]

Najam Sethi wanted to launch a PCB run Cricketing television channel subscription based where the pcb would not only have the exclusive rights to broadcast the Pakistani team international matches worldwide but also to broadcast domestic cricket.

The plan was also to provide opportunities to prominent sports journalists, legendary Pakistani Cricketers to commentate, provide expert analysis, run documentaries on Pakistani Cricketing history and achievements. To provide and broadcast coaching sessions

The PCB believed that this way, they would be able to maximize their revenues and be able to do away with the local broadcasters who had established a monopoly and were short changing the pcb for a long time.

Last I heard the pcb had applied to pemra for an official license and go ahead in the final month of Najam Seth's tenure. I hope Ehsan Mani has not scrapped the project

 

[Last Monetarist]

So why don't they use the same model again this time?

Someone got greedy somewhere, I expect.

 

[Savak]

Are you talking about Najam Sethi tenure as PSL started in his tenure?

All prior pcb chairmen. Many times sports channels and ex international cricketers and administrators have made these accusations against the pcb

 

[cricketjoshila]

The PCB has many justified reasons to demand a better deal from the broadcasters this time around. The broadcasters are exploiting the monopoly position that they have.

Monopoly? ARY,GEO,PTV sports thats 3 channels. How is it a monopoly?

You have to understand that if the broadcaster meets the $40mn price of PCB it means they will have to find revenues worth almost $13mn every year on top of what pcb was earning to keep their profitability at the same level as PCB.

$13mn is around pkr1,807,000,000 add to that the production cost.


Now the entire ad revenue of 2017 PSL was pkr 531,741,102 .

So the broadcaster is not willing to pay that much money.

 

[navin]

Najam Sethi wanted to launch a PCB run Cricketing television channel subscription based where the pcb would not only have the exclusive rights to broadcast the Pakistani team international matches worldwide but also to broadcast domestic cricket.

The plan was also to provide opportunities to prominent sports journalists, legendary Pakistani Cricketers to commentate, provide expert analysis, run documentaries on Pakistani Cricketing history and achievements. To provide and broadcast coaching sessions

The PCB believed that this way, they would be able to maximize their revenues and be able to do away with the local broadcasters who had established a monopoly and were short changing the pcb for a long time.

Last I heard the pcb had applied to pemra for an official license and go ahead in the final month of Najam Seth's tenure. I hope Ehsan Mani has not scrapped the project

So they want to create a "monopoly" to end a "monopoly", interesting.

 

[cricketjoshila]

Calculations are of the top of my head and hence may have errors.

 

[Savak]

Monopoly? ARY,GEO,PTV sports thats 3 channels. How is it a monopoly?

You have to understand that if the broadcaster meets the $40mn price of PCB it means they will have to find revenues worth almost $13mn every year on top of what pcb was earning to keep their profitability at the same level as PCB.

$13mn is around pkr1,807,000,000 add to that the production cost.


Now the entire ad revenue of 2017 PSL was pkr 531,741,102 .

So the broadcaster is not willing to pay that much money.

These 3 sports channels have been around for a long time. Najam Sethi in many interviews complained that these channels continously kept offering ridiculous low bids for broadcast deals because the pcb did not have much options outside these parties. The advertising revenue should bump up with more and more games being played in Pakistan.

 

[barah_admi]

The article is a bit flimsy as no mention is given of the sources which state that the supposed $42 million target has not been met. And it also goes on to state "It may be mentioned here that the PCB’s income through TV rights in 2016 and 2017 had increased remarkably."

These are almost contradictory statements, plus as the revenue model has changed, an almost useless comparison.

Poor journalism as per usual.

 

[Savak]

So they want to create a "monopoly" to end a "monopoly", interesting.

The PCB as part of its fiduciary duty has to do what is in its best interest.

 

[Savak]

The article is a bit flimsy as no mention is given of the sources which state that the supposed $42 million target has not been met. And it also goes on to state "It may be mentioned here that the PCB’s income through TV rights in 2016 and 2017 had increased remarkably."

These are almost contradictory statements, plus as the revenue model has changed, an almost useless comparison.

Poor journalism as per usual.

Like I said, on paper the pcb has a solid case for demanding the price it has quoted ie

League having run for 3 years without failure

Two finals and a few games having been played in Pakistan in front of jam packed stadiums

Nail biting matches with plenty of games having gone to the wire

No payment controversy

Foreign players praising how professionally the tournament has been run and how well they have been treated by the pcb and franchise owners

Nation of Pakistan proving its hospitality to foreign players

An apparent brand marketing report which valued the psl at $500 million

Even these broadcasters acknowledge the popularity of the psl but they are trying to low ball the pcb and offering an even lower amount than what they paid when the league was in infancy and completely unproven?

I suspect some shady business going on behind the scenes in terms of kickbacks

 

[Titan24]

So cost with be almost 6-7 times more for the media right buyer then it was for PCB. PCB spent almost 7-8 m dollars for first 3 years in their media rights cost and now they want someone to by it for 7-8 times more. Thats a bit too a steep a jump from PCB, I think.

Even if they get to sale it at get 3-4 times the previous cost which would be somewhere around 21-32 m dollars it would be a huge success. They would earn almost 4-5 times the profit which earned before for 3 years which would be a huge jump in the bank accounts of PCB.

Whatever it is, good thing is its only going to be more than before so definitely more revenue for PCB on the way.

 

[cricketjoshila]

Like I said, on paper the pcb has a solid case for demanding the price it has quoted ie

League having run for 3 years without failure

Two finals and a few games having been played in Pakistan in front of jam packed stadiums

Nail biting matches with plenty of games having gone to the wire

No payment controversy

Foreign players praising how professionally the tournament has been run and how well they have been treated by the pcb and franchise owners

Nation of Pakistan proving its hospitality to foreign players

An apparent brand marketing report which valued the psl at $500 million

Even these broadcasters acknowledge the popularity of the psl but they are trying to low ball the pcb and offering an even lower amount than what they paid when the league was in infancy and completely unproven?

I suspect some shady business going on behind the scenes in terms of kickbacks

Can you tell comment about the revenues i mentioned.?

 

[Savak]

Can you tell comment about the revenues i mentioned.?

Ignoring the numbers for a second. There is no justified reason for the broadcasters to be offering a low bid to the pcb for the psl compared to the first season

 

[ARK Rafay]

TV bidders won't bid what they can't profit from much. I know PSL's 4th edition is now going to happen. But PCB needs to take account of Media houses production cost as well.

Hope it all ends well for everyone.

 

[cricketjoshila]

Ignoring the numbers for a second. There is no justified reason for the broadcasters to be offering a low bid to the pcb for the psl compared to the first season

The numbers are the most important thing.

PSL 3 made a profit of around pkr400mn thats $3mn. Thats the most important number. Any bids will revolved round that number.

 

[Savak]

I fear for the leagues future now. The PSL Franchises have already put the pcb on notice that they better start seeing some $$ now. With a disastrously low bid on the biggest cash source, is the league viable now?

What alternatives does the pcb have to realize their desired number?

 

[navin]

I fear for the leagues future now. The PSL Franchises have already put the pcb on notice that they better start seeing some $$ now. With a disastrously low bid on the biggest cash source, is the league viable now?

What alternatives does the pcb have to realize their desired number?

Don't you think GOP should inject a few million dollars in PSL until it becomes self-sustainable? I mean they really wouldn't want it to discontinue.

 

[Titan24]

I fear for the leagues future now. The PSL Franchises have already put the pcb on notice that they better start seeing some $$ now. With a disastrously low bid on the biggest cash source, is the league viable now?

What alternatives does the pcb have to realize their desired number?

Its the quest for growth PCB is looking for, they can still manage the same or even double tripple the amount then previous season.

Sustaiabilty of any product is only in question if either it has regressed or growth has stopped or minimized, which is clearly not the case here. The case is of higher expectations vs real world.

 

[Savak]

Najam Sethi proposed putting the PSL in a seperate corporate entity and then listing it on the Stock Exchange. I wonder if that idea can actually work?

 

[Savak]

Don't you think GOP should inject a few million dollars in PSL until it becomes self-sustainable? I mean they really wouldn't want it to discontinue.

That would be disastrous for the image of the league if it has to depend on a govt bail out. Any future franchise owner and broadcaster needs to have the confidence that the product can do well tremendously on its own without needing handouts.

 

[navin]

That would be disastrous for the image of the league if it has to depend on a govt bailout. Any future franchise owner and broadcaster needs to have the confidence that the product can do well tremendously on its own without needing handouts.

But the present circumstances aren't helping to paint a better picture either. At least it would sustain a few more years to recover and fight back. I mean how long these franchises can sustain loses before giving up.

 

[Savak]

But the present circumstances aren't helping to paint a better picture either. At least it would sustain a few more years to recover and fight back. I mean how long these franchises can sustain loses before giving up.

Having top quality foreign players participating in the full league with the full league being played in Pakistan and having international cricket in Pakistan would have helped.

The solution should be reaching out to the private and public sector. Like the idea behind putting the PSL in a corporation and then listing that corporation on the stock exchange can be a good strategy.

 

[Napa]

Do you believe it could be possible that the psl is profitable and worth what the pcb is demanding but the broadcasters want to pay the minimum possible price?

If the broadcasters are competing with each other, then they would bid up the price to the point where the winner of the auction expects to make a bit more than breakeven.

The larger issue is the amount of extra sales firms expect to make by advertising during PSL games. If the economy is doing well, this number will be larger. It all comes down to how the economy is doing.

 

[Hawkeye]

Expected.

There just isn't enough $$ in the economy right now.

 

[super hitter]

LAHORE: The Pakistan Cricket Board (PCB) has started receiving bids for the next three years’ media rights for the Pakistan Super League (PSL) but they are certainly not as attractive or handsome as compared to the bids received for the first two PSL editions (2016-17), Dawn learnt on Saturday.

[MENTION=2501]Savak[/MENTION]

"Dawn learnt on Saturday"

 

[navin]

"Dawn learnt on Saturday"

so?

 

[super hitter]

so?

The political rivalry.

It's hard to believe that PCB have failed to get higher bids, however, a World Cup, an Asia Cup and a T20 World Cup in the next two years might be the reason.

 

[Barragan]

Then do a deal for a year or two!

Economy is in a bad shape, hence shelling out money will be difficult, so just do a short term deal and hope the situation improves in Pak over the next year or two.

 

[MMHS]

PSL needs to come back in PAK, be with inferior foreigners, otherwise in every aspect it'll start to get devalued. And, if PCB can't dare to arrange PSL in PAK after 10 years of Lahore attack& PSL in it's 5th year, then PAK posters should leave the dream of hosting 2030 Asia Cup in PAK, let alone 2020.

 

[Hedz]

Everything combined is nothing short of a crisis for the PCB and the PSL

No current owners of the Sixth Team
Current franchises supposedly had a fallout over the current financial model, individual franchise financial details have been leaked
Broadcasters haven’t met the PCBs targeted amount

Really hope they can pull things together pretty quickly, cos we have just 2 months till the league kicks off and atm thinks don’t look remotely positive

 

[kamz]

Najam Sethi proposed putting the PSL in a seperate corporate entity and then listing it on the Stock Exchange. I wonder if that idea can actually work?

where is the growth story

why will anyone buy shares? put their equity in

IPO is not easy as people think.

As any investor there needs to be a growth story. Not potential but proper growth. Here the biggest revenue line has gone downwards rather than an upward growth. so IPO wont work.

I can understand why broadcast revenue is not pulling off as expected. As a few posters highlighted, only 3 sports channels and they dont low ball because they are bullies, but their ad revenue is significantly low compared to entertainment channels.

So they will only bid what they can pay (which is what businesses are willing to pay for an advertising spot) and by the way the advertising spot in pakistan for news entertainment is higher than sports.

So blame the public and people of pakistan! because they like seeing the talk shows and political shows rather than sports. If more eyes on the match, that advertising spot will demand higher fees.

PCB tried to lobby where they can give rights to entertainment channels, to build up competition, but unfortunately gvt of pak hasnt allowed sports transmission to entertainment channels

 

[gazza619]

Why announce to the whole world the revenue target and then embarrass yourself by falling short of it!

Is this how business is done!

 

[barah_admi]

Like I said, on paper the pcb has a solid case for demanding the price it has quoted ie

League having run for 3 years without failure

Two finals and a few games having been played in Pakistan in front of jam packed stadiums

Nail biting matches with plenty of games having gone to the wire

No payment controversy

Foreign players praising how professionally the tournament has been run and how well they have been treated by the pcb and franchise owners

Nation of Pakistan proving its hospitality to foreign players

An apparent brand marketing report which valued the psl at $500 million

Even these broadcasters acknowledge the popularity of the psl but they are trying to low ball the pcb and offering an even lower amount than what they paid when the league was in infancy and completely unproven?

I suspect some shady business going on behind the scenes in terms of kickbacks

I mean this could all be true but I spoke about the article not containing any sources or any reliable information and contradictions. It is poorly written and possibly poorly researched and leaves me not knowing if any of what is being said is true.

 

[Savak]

where is the growth story

why will anyone buy shares? put their equity in

IPO is not easy as people think.

As any investor there needs to be a growth story. Not potential but proper growth. Here the biggest revenue line has gone downwards rather than an upward growth. so IPO wont work.

I can understand why broadcast revenue is not pulling off as expected. As a few posters highlighted, only 3 sports channels and they dont low ball because they are bullies, but their ad revenue is significantly low compared to entertainment channels.

So they will only bid what they can pay (which is what businesses are willing to pay for an advertising spot) and by the way the advertising spot in pakistan for news entertainment is higher than sports.

So blame the public and people of pakistan! because they like seeing the talk shows and political shows rather than sports. If more eyes on the match, that advertising spot will demand higher fees.

PCB tried to lobby where they can give rights to entertainment channels, to build up competition, but unfortunately gvt of pak hasnt allowed sports transmission to entertainment channels

This is where I am disappointed with the IK led govt, he should make an exception in this case and allow the pcb whatever it needs to build a successful psl via tax exemptions and permission to sell media rights to entertainment channels

 

[AMSS]

Something is *very* off about these numbers.

Pakistan is a country with a GDP per capita more or less in the same bracket as India and a population that roughly stands at one sixth of its neighbor.

The IPL's latest broadcast right went for 500 million USD per year. Logically, PSL's rights should sell for a figure close to 80 million USD a year, or 240 million USD for three years. Granted, IPL has been in existence for longer but, even so, this disparity in number is too large to explain.

Can anyone explain why PSL's annual broadcast rights are valued 100 times less than IPL?

 

[Savak]

Lol, kheir even I will acknowledge the disparity in quality and the fact the psl isn't being played a 100% in Pakistan yet. But the price that the pcb is asking for is reasonable in my view for now.

 

[ipl_fan]

Lol, kheir even I will acknowledge the disparity in quality and the fact the psl isn't being played a 100% in Pakistan yet. But the price that the pcb is asking for is reasonable in my view for now.

This might be a bitter pill to swallow. PSL is not as established an entity as you and PCB think. It is probably the most unsettled amongst T20 leagues. IPL, BBL, CPL are more settled and professionally run leagues which instill confidence among the investors fraternity.

1. PSL doesn't have a dedicated window. They have to scout for foreign talent almost every year based on the available dates. How will a channel believe that the best foot is being put forward to make a 3 year investment.

2. The fact that half the foreign players refuse to come to Pakistan to play the semis and finals has turned PSL in to a joke. What is the point of running a tournament in which people who have been instrumental in driving a team to the semis skipping the final steps. How will a channel take such a league seriously.

3. PSL is a league of has been foreigners or can't make it to A league foreign cricketers. Good luck with convincing the channels to pick this league up for a good price.

 

[Savak]

This might be a bitter pill to swallow. PSL is not as established an entity as you and PCB think. It is probably the most unsettled amongst T20 leagues. IPL, BBL, CPL are more settled and professionally run leagues which instill confidence among the investors fraternity.

1. PSL doesn't have a dedicated window. They have to scout for foreign talent almost every year based on the available dates. How will a channel believe that the best foot is being put forward to make a 3 year investment.

2. The fact that half the foreign players refuse to come to Pakistan to play the semis and finals has turned PSL in to a joke. What is the point of running a tournament in which people who have been instrumental in driving a team to the semis skipping the final steps. How will a channel take such a league seriously.

3. PSL is a league of has been foreigners or can't make it to A league foreign cricketers. Good luck with convincing the channels to pick this league up for a good price.

The window for the psl has always been from Jan-Feb, it is the wrong time period as most foreign players will not want to come play and risk injury before the IPL. Also the PSL cannot compete with the IPL in terms of salaries. In order to improve their chances of getting foreign players they need to change their window to after the IPL but that won't be easy due to Pakistan's own commitments and commitments of other international teams but regardless the pcb has to understand they need to choose a window for the psl after the IPL.

I dont think you can conclude that the psl has been run unprofessionally, the pcb has done a good job in the circumstances. One can hope the quality of players will improve with the passage of time and with each and every game the pcb successfully hosts in Pakistan in front of jam packed crowds

 

[jagatk]

The window for the psl has always been from Jan-Feb, it is the wrong time period as most foreign players will not want to come play and risk injury before the IPL. Also the PSL cannot compete with the IPL in terms of salaries. In order to improve their chances of getting foreign players they need to change their window to after the IPL but that won't be easy due to Pakistan's own commitments and commitments of other international teams but regardless the pcb has to understand they need to choose a window for the psl after the IPL.

I dont think you can conclude that the psl has been run unprofessionally, the pcb has done a good job in the circumstances. One can hope the quality of players will improve with the passage of time and with each and every game the pcb successfully hosts in Pakistan in front of jam packed crowds

But why do you hope to compete with ipl financially or otherwise, BBL doesn't yet it is successful. PSL's problem is the PCB seems to be in a hurry to get cricket back to Pakistan and is using psl to do bulk of the work which I think is stupid. You need to bring international cricket first back not start PSL. It's impossible for anyone to take a winner of a tournament seriously when the biggest reason for winning is the opponent's best players did not participate in the match.

 

[Savak]

But why do you hope to compete with ipl financially or otherwise, BBL doesn't yet it is successful. PSL's problem is the PCB seems to be in a hurry to get cricket back to Pakistan and is using psl to do bulk of the work which I think is stupid. You need to bring international cricket first back not start PSL. It's impossible for anyone to take a winner of a tournament seriously when the biggest reason for winning is the opponent's best players did not participate in the match.

Its a catch 22 situation, international teams and security agencies will demand proof that the Pakistani government can provide fool proof presidential level security to foreign players and that the PCB can successfully organize many international games in front of jam packed crowds. Not many international teams are willing to tour Pakistan even though the PCB has successfully held around 15 international games in Pakistan in front of jam packed crowds since 2009.

Therefore right now the PSL is the only reason methodology the PCB has of proving to the world that international cricket can be played in Pakistan.

 

[jagatk]

Its a catch 22 situation, international teams and security agencies will demand proof that the Pakistani government can provide fool proof presidential level security to foreign players and that the PCB can successfully organize many international games in front of jam packed crowds. Not many international teams are willing to tour Pakistan even though the PCB has successfully held around 15 international games in Pakistan in front of jam packed crowds since 2009.

Therefore right now the PSL is the only reason methodology the PCB has of proving to the world that international cricket can be played in Pakistan.

This mess is PCB's doing, WI did travel to Pakistan and I am sure Afghanistan and Bangladesh with the right incentive and diplomacy would have followed suit, PCB went guns blazing with see we held PSL in Pakistan, now come play here even if it was our turn to visit you, that is literally the opposite of diplomacy.

 

[kamz]

Something is *very* off about these numbers.

Pakistan is a country with a GDP per capita more or less in the same bracket as India and a population that roughly stands at one sixth of its neighbor.

The IPL's latest broadcast right went for 500 million USD per year. Logically, PSL's rights should sell for a figure close to 80 million USD a year, or 240 million USD for three years. Granted, IPL has been in existence for longer but, even so, this disparity in number is too large to explain.

Can anyone explain why PSL's annual broadcast rights are valued 100 times less than IPL?

because the advertising spend of companies on sports is higher in India than in Pak.

In pakistan advertising spend is more on entertainment channels

 

[AMSS]

because the advertising spend of companies on sports is higher in India than in Pak.

In pakistan advertising spend is more on entertainment channels

Unless you have specific data to prove your case, I cannot believe that pakistani entertainment channels get more advertising revenue than indian channels on a proportionate basis.

Cricket is a staple in both India and pakistan. I don't see why companies in pakistan won't like to spend on cricket. Especially when everyone agrees that PSL has been an unqualified success among the cricket watching public in pakistan.

Once again, I would love to hear a good, convincing explanation to this massive numerical anomaly. PSL should be earning a sixth of what IPL does from broadcast deal. And even if we assume that broadcasters paid a premium to BCCI for the IPL, let's say two times its actual worth, even then PSL's broadcast deal makes no sense.

I mean, even in PCB's best case scenario of 42 millions over three years, the PSL is earning 35 times less than IPL. It makes NO sense.

 

[cricketjoshila]

Unless you have specific data to prove your case, I cannot believe that pakistani entertainment channels get more advertising revenue than indian channels on a proportionate basis.

Cricket is a staple in both India and pakistan. I don't see why companies in pakistan won't like to spend on cricket. Especially when everyone agrees that PSL has been an unqualified success among the cricket watching public in pakistan.

Once again, I would love to hear a good, convincing explanation to this massive numerical anomaly. PSL should be earning a sixth of what IPL does from broadcast deal. And even if we assume that broadcasters paid a premium to BCCI for the IPL, let's say two times its actual worth, even then PSL's broadcast deal makes no sense.

I mean, even in PCB's best case scenario of 42 millions over three years, the PSL is earning 35 times less than IPL. It makes NO sense.

1 inr is equal to 1.96pkr. So the Indian currency is twice as strong.Add to that the fact that the Indian GDP is 10 times of Pakistan.

Coming to per capita income, India's per capita income in PPP terms in 2017 was $7030 while Pakistan's was $5830.There is almost a 20% difference between them.In addition to that,the number of people in each country. Indian market's spending power per capita is 20% more and multiplied by 6 times.

Indian economy is growing at 7% plus while Pakistani economy is not in a very good shape.

Lastly, how many Pakistani companies listed on KSE have a market cap of $1bn or more? That should tell us how many companies in Pakistan are capable of spending big on Ads.

 

[cricketjoshila]

Also IPL rights bidders included

21st Century Fox owned STAR
Sony corp owned Sony Network
Reliance owned Jio
Facebook etc

Pakistani broadcasters dont have such deep pockets.

On top of that the likes of Supersports,OSN,Bein etc put in bids for their respective regions. PSL doesnot get that kind of attention.

According to the OP, PCB made ad revenues worth Rs 531,741,102 in 2017. SONY the then rights holders of IPL made $200mn in AD revenues in 2017.

 

[AMSS]

1 inr is equal to 1.96pkr. So the Indian currency is twice as strong.Add to that the fact that the Indian GDP is 10 times of Pakistan.

Coming to per capita income, India's per capita income in PPP terms in 2017 was $7030 while Pakistan's was $5830.There is almost a 20% difference between them.In addition to that,the number of people in each country. Indian market's spending power per capita is 20% more and multiplied by 6 times.

Indian economy is growing at 7% plus while Pakistani economy is not in a very good shape.

Lastly, how many Pakistani companies listed on KSE have a market cap of $1bn or more? That should tell us how many companies in Pakistan are capable of spending big on Ads.

Given that both BCCI and PCB are bankrolled by either domestic companies or subsidiaries of MNCs, the strength of currency is pretty much irrelevant to the debate. This isn't export competitiveness we are talking about.

If you read my first post in this thread, you'd note that I didn't say India and Pakistan had the same GDP per capita. I said they belonged to the same 'bracket'. India's PPP being 20% higher than pakistan on a per capita basis means they can be clubbed together.

I'll admit your argument on economic growth. It's possible that broadcasters shell out higher amounts for BCCI noticing that buying power of Indians would increase substantially, while this may not be the case in pakistan. Good point.

Not convinced by the market cap argument either. IPakistani companies don't have to pay the same amount as their indian counterparts so they don't need to enjoy the same revenue or market valuation.

The question for you is that if we take into account the following factors

1) India's 6 times greater population, and

2) Higher growth rate in India

Are they significant enough to explain the 35 times difference in broadcast deals for IPL and PSL?

A 10 times difference would be normal perhaps. A 12 times difference would mean India is 6 times bigger population wise and twice as rich. But 35 times? Something doesn't compute here.

 

[par]

Given that both BCCI and PCB are bankrolled by either domestic companies or subsidiaries of MNCs, the strength of currency is pretty much irrelevant to the debate. This isn't export competitiveness we are talking about.

If you read my first post in this thread, you'd note that I didn't say India and Pakistan had the same GDP per capita. I said they belonged to the same 'bracket'. India's PPP being 20% higher than pakistan on a per capita basis means they can be clubbed together.

I'll admit your argument on economic growth. It's possible that broadcasters shell out higher amounts for BCCI noticing that buying power of Indians would increase substantially, while this may not be the case in pakistan. Good point.

Not convinced by the market cap argument either. IPakistani companies don't have to pay the same amount as their indian counterparts so they don't need to enjoy the same revenue or market valuation.

The question for you is that if we take into account the following factors

1) India's 6 times greater population, and

2) Higher growth rate in India

Are they significant enough to explain the 35 times difference in broadcast deals for IPL and PSL?

A 10 times difference would be normal perhaps. A 12 times difference would mean India is 6 times bigger population wise and twice as rich. But 35 times? Something doesn't compute here.

There is one more big difference between IPL and PSL. IPL is played for over 6 weeks between 8 teams. PSL is played for less than 3 weeks between 6 teams.

 

[cricketjoshila]

Given that both BCCI and PCB are bankrolled by either domestic companies or subsidiaries of MNCs, the strength of currency is pretty much irrelevant to the debate. This isn't export competitiveness we are talking about.

If you read my first post in this thread, you'd note that I didn't say India and Pakistan had the same GDP per capita. I said they belonged to the same 'bracket'. India's PPP being 20% higher than pakistan on a per capita basis means they can be clubbed together.

I'll admit your argument on economic growth. It's possible that broadcasters shell out higher amounts for BCCI noticing that buying power of Indians would increase substantially, while this may not be the case in pakistan. Good point.

Not convinced by the market cap argument either. IPakistani companies don't have to pay the same amount as their indian counterparts so they don't need to enjoy the same revenue or market valuation.

The question for you is that if we take into account the following factors

1) India's 6 times greater population, and

2) Higher growth rate in India

Are they significant enough to explain the 35 times difference in broadcast deals for IPL and PSL?

A 10 times difference would be normal perhaps. A 12 times difference would mean India is 6 times bigger population wise and twice as rich. But 35 times? Something doesn't compute here.

Whether MNC subsidiaries or domestic companies,in India, both have to spend significant forex on importing raw materials or other things. So the strength of the currency matters.

The present IPL deal is $2.55bn for 5 years, roughly $500mn a year. Now PSL is looking for $42mn for 3 years thats $14mn a year.

PCB's Ad revenues in 2017 were close to $4mn(taking usd to pkr at 130). Sony's ad revenue from IPL in 2017 was $200mn. So if you see, the Ad revenue itself is more than 35 times. STAR last year had AD revenues worth $300mn.So the revenues justify the valuation.

You need companies to have a certain revenue to be able to spend a certain amount of money on sponsorships. Pakistani companies may not be earning that much to be spending on multiple cricket deals, from players to PCB international cricket to PSL.

6times greater population with 20% extra spending power. Thats a big amount.

More than that, the Indian middle class and above have significantly higher per capita income and their population will be almost equal to Pakistan's total population.

I made a few other points in another post.

 

[AMSS]

There is one more big difference between IPL and PSL. IPL is played for over 6 weeks between 8 teams. PSL is played for less than 3 weeks between 6 teams.

Good point and I completely overlooked it. The duration of the league itself is significant. PSL having lesser number of games does affect the size of broadcast deal.

 

[AMSS]

Whether MNC subsidiaries or domestic companies,in India, both have to spend significant forex on importing raw materials or other things. So the strength of the currency matters.

The present IPL deal is $2.55bn for 5 years, roughly $500mn a year. Now PSL is looking for $42mn for 3 years thats $14mn a year.

PCB's Ad revenues in 2017 were close to $4mn(taking usd to pkr at 130). Sony's ad revenue from IPL in 2017 was $200mn. So if you see, the Ad revenue itself is more than 35 times. STAR last year had AD revenues worth $300mn.So the revenues justify the valuation.

You need companies to have a certain revenue to be able to spend a certain amount of money on sponsorships. Pakistani companies may not be earning that much to be spending on multiple cricket deals, from players to PCB international cricket to PSL.

6times greater population with 20% extra spending power. Thats a big amount.

More than that, the Indian middle class and above have significantly higher per capita income and their population will be almost equal to Pakistan's total population.

I made a few other points in another post.

For the Nth number of time, I know the numbers you are dropping without understanding my query.

Like you said yourself, 6 times population with 20 percent extra spending power equals an IPL valuation that should be not more than 12 times PSL...let me be liberal and say 15-18 times. Not 35.

But [MENTION=107298]par[/MENTION] above has actually furnished a good reason that escaped me...the duration of the league. That's one powerful piece of this valuation puzzle as far as I am concerned.

I looked up further and found that KSE's total market cap is 35 times less than BSE. This is in line with the difference in broadcast deals of the two leagues. So maybe it's the case that IPL's broadcast right holders valued it the same way investors in capital markets do...price according to expected future returns.

 

[cricketjoshila]

For the Nth number of time, I know the numbers you are dropping without understanding my query.

Like you said yourself, 6 times population with 20 percent extra spending power equals an IPL valuation that should be not more than 12 times PSL...let me be liberal and say 15-18 times. Not 35.

But [MENTION=107298]par[/MENTION] above has actually furnished a good reason that escaped me...the duration of the league. That's one powerful piece of this valuation puzzle as far as I am concerned.

I looked up further and found that KSE's total market cap is 35 times less than BSE. This is in line with the difference in broadcast deals of the two leagues. So maybe it's the case that IPL's broadcast right holders valued it the same way investors in capital markets do...price according to expected future returns.

See the AD revenue difference between the leagues and the rate of growth. That itself justifies the valuation.

 

[Hawkeye]

Lol, kheir even I will acknowledge the disparity in quality and the fact the psl isn't being played a 100% in Pakistan yet. But the price that the pcb is asking for is reasonable in my view for now.

What your view is not reality, far from it.

 

[Savak]

According to media report, the best offer the pcb has received so far is $33 million for the next 3 years from a UK based broadcaster for the psl and they have comfortably outbid all the local broadcasters.

 

[MightyObnoxious]

Two important factors at play here
1-Only sports channels can bid. And here, there are only three. PTV and Ten Sports make a joint bid and Geo Super often doesn't, so the price doesn't increase. Maybe it is something that competation comission of Pakistan should look into.
2- Ad market is not that big. And with now the govt deciding not to be an advertiser, this will get worse. And there is no pay tv. For PSL to work and get money, you need to have DTH and pay services.
PCB under Najam Sethi was right in seeking govt's permission to launch it's own channel and take PSL behind the pay wall. That may hurt the eye ball but will definetley increase revenue. Look at it this way,(I am simplifying it, but I am an individual. An organisation like PCB could definetley do proper marketing research) as per economic survey of Pakistan 30mm are middle class household. Of those, if 20mm consider buying a PSL subscription for Rs 150, this nets you $21m. Obviously this is all top of my head but this is the only way you can see Broadcast income increase and only way teams make break even.

 

[MightyObnoxious]

Its the quest for growth PCB is looking for, they can still manage the same or even double tripple the amount then previous season.

Sustaiabilty of any product is only in question if either it has regressed or growth has stopped or minimized, which is clearly not the case here. The case is of higher expectations vs real world.

This is why I think PCB was greedy in expanding the league. Other franchises rightfully objected. You can't increase the pool without increasing the kitty. Now 6 teams sharing the money.

 

[MightyObnoxious]

Okay so this settles it. PCB to follow the previous practice of buying airtime.
https://www.facebook.com/blitz.pk/photos/a.436821616429771/1794110227367563/?type=3&theater

 

[Sunny_majoka]

Okay so this settles it. PCB to follow the previous practice of buying airtime.
https://www.facebook.com/blitz.pk/photos/a.436821616429771/1794110227367563/?type=3&theater

this is good . this method is favoring pcb

 

[Abdullah719]

PSL broadcasting rights sold to Blitz Advertising and Techfront at 358% more than previous 3 years

PCB HITS A SIX ON HBL PSL BROADCAST AND LIVE-STREAMING RIGHTS

Rights sold to Blitz Advertising and Techfront until 2021 at an unprecedented 358 per cent more than the previous three years of one of the most attractive cricket leagues on the planet

Lahore – December 21, 2018: The Pakistan Cricket Board today announced the consortium of Blitz Advertising and Techfront as its broadcast and live-streaming partner for the star-studded HBL Pakistan Super League from 2019 to 2021.

While the final figure on the agreement will remain confidential, the new agreement is 358 per cent more than the previous three years of one of the most competitive and well-organised tournaments on the planet.

With the broadcast and live-streaming rights now finalized, further details on local and foreign TV channels, which will air live action of the HBL PSL 2019 from February 14, will be finalized and then released in due course.

The new rights cycle renews a time-tested partnership between Pakistan Cricket Board, Blitz Advertising and Techfront.

Blitz Advertising is part of Pakistan’s largest full service communications group with nationwide presence and represents Publicis Media, the world’s premier media management group in Pakistan.

Techfront, a UAE-based affiliate of Global Sports Commerce (GSC), is one of the largest sports technology and management companies providing dynamic solutions and commercial management to leading sports stakeholders.

“We have successfully exceeded our targets for the new HBL PSL broadcast and live-streaming rights,” Mr Ehsan Mani, Chairman of the PCB, said.

“I would like to congratulate and thank Blitz Advertising and Techfront for partnering with us once again. This is a time-tested partnership and our joint objective, for the next three years, is to ensure that HBL PSL continues to grow in terms of fan engagement.”

The bid process for the new rights cycle saw tremendous interest from multiple parties, with added focus on the live-streaming rights of HBL PSL in a growing digital market.

“I would like to thank all the companies who expressed their interest in partnering with us for the next three years. We value and appreciate their interest and support,” concluded Mr Mani.

Mr Ahsen Idris, CEO of Blitz Advertising, said: “Blitz Advertising has had three wonderful years with HBL PSL and this new three-year partnership is a win achieved with a six.

“Taking heart from past successes, we will make this a win-win scenario for all stakeholders and will play our role to see the game of cricket in Pakistan benefit from this partnership.”

Mr M.S Muralidharan, Managing Director of Techfront, said: “We have been involved with HBL PSL since its very first season in various capacities. We are glad to have procured the global broadcast and live-streaming rights for HBL PSL rom 2019-2021.

“The tournament has been a huge success and will continue to grow globally. We are committed to widening the reach of the tournament and we look forward to working with Pakistan Cricket Board once again.”

HBL PSL returns to action with a glittering opening ceremony in Dubai followed by the opening game between Islamabad United and Lahore Qalandars on February 14, 2019. For the first time in the short history of this tournament, eight matches at the backend of the tournament with Lahore staging three and Karachi hosting five, including the March 17, 2019 final.

 

[iPakistani]

PCB HITS A SIX ON HBL PSL BROADCAST AND LIVE-STREAMING RIGHTS

Rights sold to Blitz Advertising and Techfront until 2021 at an unprecedented 358 per cent more than the previous three years of one of the most attractive cricket leagues on the planet

Lahore – December 21, 2018: The Pakistan Cricket Board today announced the consortium of Blitz Advertising and Techfront as its broadcast and live-streaming partner for the star-studded HBL Pakistan Super League from 2019 to 2021.

While the final figure on the agreement will remain confidential, the new agreement is 358 per cent more than the previous three years of one of the most competitive and well-organised tournaments on the planet.

With the broadcast and live-streaming rights now finalized, further details on local and foreign TV channels, which will air live action of the HBL PSL 2019 from February 14, will be finalized and then released in due course.

The new rights cycle renews a time-tested partnership between Pakistan Cricket Board, Blitz Advertising and Techfront.

Blitz Advertising is part of Pakistan’s largest full service communications group with nationwide presence and represents Publicis Media, the world’s premier media management group in Pakistan.

Techfront, a UAE-based affiliate of Global Sports Commerce (GSC), is one of the largest sports technology and management companies providing dynamic solutions and commercial management to leading sports stakeholders.

“We have successfully exceeded our targets for the new HBL PSL broadcast and live-streaming rights,” Mr Ehsan Mani, Chairman of the PCB, said.

“I would like to congratulate and thank Blitz Advertising and Techfront for partnering with us once again. This is a time-tested partnership and our joint objective, for the next three years, is to ensure that HBL PSL continues to grow in terms of fan engagement.”

The bid process for the new rights cycle saw tremendous interest from multiple parties, with added focus on the live-streaming rights of HBL PSL in a growing digital market.

“I would like to thank all the companies who expressed their interest in partnering with us for the next three years. We value and appreciate their interest and support,” concluded Mr Mani.

Mr Ahsen Idris, CEO of Blitz Advertising, said: “Blitz Advertising has had three wonderful years with HBL PSL and this new three-year partnership is a win achieved with a six.

“Taking heart from past successes, we will make this a win-win scenario for all stakeholders and will play our role to see the game of cricket in Pakistan benefit from this partnership.”

Mr M.S Muralidharan, Managing Director of Techfront, said: “We have been involved with HBL PSL since its very first season in various capacities. We are glad to have procured the global broadcast and live-streaming rights for HBL PSL rom 2019-2021.

“The tournament has been a huge success and will continue to grow globally. We are committed to widening the reach of the tournament and we look forward to working with Pakistan Cricket Board once again.”

HBL PSL returns to action with a glittering opening ceremony in Dubai followed by the opening game between Islamabad United and Lahore Qalandars on February 14, 2019. For the first time in the short history of this tournament, eight matches at the backend of the tournament with Lahore staging three and Karachi hosting five, including the March 17, 2019 final.

This is great news, will it be on the same PTV channel on the UK or is it a different channel this time? Hope it is crisp clear coverage on a well known channel, will do PCB a lot of good.