Television

We expect ICL to break even in two and a half years

 
We expect ICL to break even in two and a half years

When Zee launched the Indian Cricket League in the face of a take-no-prisoners campaign of opposition from the Board of Control for Cricket in India last year, there was scepticism galore on whether the Subhash Chandra-backed league would bat it out. Particularly after the the BCCI announced plans for its own league shortly thereafter.

ICL, however, successfully staged two events despite all the hurdles thrown in its way. The Indian Premier League kicking off on 18 April notwithstanding, Zee Sports business head Himanshu Mody is confident that his cricket endeavour will hold its own.

Indiantelevision.com‘s Ashwin Pinto caught up with Mody to ascertain his views on the progress made and future plans.

Excerpts:

 

Firstly, congratulations on having been able to deliver the second edition of the ICL despite the best efforts of the BCCI to skewer you. How has the experience been different from the first edition?

It was much better. The first one was with six teams in one venue. There were 20 games. For the next event we added two more teams and had three venues. Lahore came from across the border. The event was held on a larger scale.

 

What were the learnings from the event that you will take, going forward?

We learn every day. Despite the pressure and resistance that we face, I think that we are set on a path to success. We have good players and have built on the ground infrastructure. We have 250 members, 80 of whom are Indian players. The rest are foreigners - coaches, players support staff, etc.

 

How is the event being expanded upon this year?

From April to September it is summer and then the monsoon season. There is not we can do in this period. We will hold an event later this year. We could include ODIs as well. We had a non televised ODI tournament in January which was played in Chennai and Hyderabad. What we come out with will depend on the commercial viability.

 

How succesful have you been thus far in infrastructure and grassroot talent development?

The Indian players come from various small towns and cities like Jammu, Srinagar, Assam, Indore and Bhopal. The Indian players come from 58 cities. We have a diverse mix in this sense. We also have talent scouts in each Zone where they have gone out to find emerging talent. We will now be setting up a central Academy for our boys.

 

A notable feature this time round was that there was an increase in spectators in the stadia. Has some sort of a spectator/viewer connect with the state teams happened?

This is starting to happen. The event is a family viewing experience. People are supporting the local team. In the final, Hyderabad Heroes had a lot of local support. At the same time support depends on performance as well, which is what has hampered Mumbai.

 

Simulcasting the event on Ten Sports and Zee Sports has ramped up viewership quite significantly. What have been the average combined ratings? Have they been up to expectations or have they exceeded your brand partners‘ expectations?

The ratings have exceeded our expectations. We managed an average of 1.5. Ratings peaked at 3.5, which is more than India Test cricket and some ODI ratings.

 

Was it a challenge to get sponsors on board given the BCCI stance?

The establishment tried everything they could to prevent us from getting a start. They tried to resist sponsors from coming on. Also, to be fair, for the first event sponsors were reluctant as they did not know what to expect. The first event was a solid start.

The second event has been a big hit and on the back of that we launched a tri series between an Indian XI and a World XI. We sold most of our inventory for this. The likes of Pepsi, HUL and Vodafone have come on board.

 

And what of the other cricket boards? Do you see a softening of their stances vis-a-vis the ICL and what could be the catalyst for it?

The other cricket boards have to realise that more than ICL, it is the IPL that presents the biggest threat to them. I think that they are starting to realise this. We do not ask any existing players to break their contract. At the moment the IPL presents that dilemma to current players as to whether they should play for their country or IPL club. We have taken players who are on the fringe or who do not have a central contract with their respective boards.

The international governing body needs to take a call on what is more important. In soccer for instance, club soccer contributes more revenue as opposed to countries playing against each other. Cricket must decide if it wants to go down this route. If that happens, then country versus country matches will have to come down. If, however, it decides that the country format is more important, then the IPL could be limited in terms of matches played.

 

How has ICL fared businesswise? Could you offer any idea of the kind of investments that have been pumped in?

I cannot talk about numbers. However the business is robust. Earlier when we started this last year, we had given ourselves a breakeven period of three years. Now we expect that to happen in two and a half years.

 
The other cricket boards have to realise that more than ICL, it is the IPL that presents the biggest threat to them
 

Where have the revenues come from and how does it compare with the inaugural edition?

We have several revenue sources. We have ground sponsorship, associate sponsorship, ticket sales sponsor, advertising on television, broadband rights.

ICL was aired in several countries including UK, US, Pakistan, the Middle East, Africa, Southeast Asia, Australia and New Zealand. We did deals with international broadcasters for ICL including Showtime in the Middle East, Starhub in Singapore and Astro in

Malaysia.

 

The ICL is unique in that everything - whether it be telecast rights, teams, stadia - is owned by the promoters. Therefore, by extension, it‘s Essel that has to spend on development, promotion and marketing of every aspect of the event. With IPL as a rival, in effect you‘re confronting the power of 10 - not just a powerful cricket board but eight strong franchises as well as an established television network for share of mind. Doesn‘t that become a huge challenge?

We took satisfaction from the fact that the IPL format has duplicated ICL. The economics of the whole thing differs from product to product. We knew what the marketing plan would be and what would be enough to cover the country. We are on track. If we incur all costs and do it ourselves, then all revenues belong to us. We do not have to share them with anybody on a

80:20 or 60:40 basis.

If there is no India cricket in a certain period, then the ICL becomes a strong proposition. If you can have many news channels, I don‘t see why two leagues cannot co-exist. We can have as many events as we like with all our players.

Actor Mithun Chakraborty has picked up a stake in the Kolkata ICL team. What are the future opportunities for stakes in teams?

We are talking with a few corporates. We chose not to sell teams initially as we wanted to show people the value that we bring to the table and what our delivery is. Having done this, we can now command a premium for our teams for strategic partners. It is not just a question of money. We are looking for partners who share our vision and who can bring synergies to the table that will help the ICL grow.

We will, therefore, be selective about whom we choose to partner. We need to know the drive they have and what their objective to invest is.

 
With the BCCI‘s league being launched next week, what impact will this have on ICL in terms of retaining both local and international talent and viewer interest? In the present context, the ICL has a shelf life as a low-cost, lower value alternative to the IPL. But if these eight franchisees are going to expand in a big way, what will be left over for the ICL to pick up might just be the crumbs. Are some of these fears being expressed?

I don‘t think that it is a fair comment. There is enough local and international talent to go around. We have contracts with our players and I know that the satisfaction level they have is high. We are a closely-knit family. I don‘t see substantial movements

happening.

A mature sports market allows for trading, though. The players have contracts with us and if somebody wants them, then they will have to pay us accordingly. That is how sports clubs operate globally. A player cannot simply break his contract. Our stated objective has been to have talent at the grassroots level. So we did not go out and try to get the likes of Sachin, Dravid.

What we do is in line with what Zee does if you look at shows like Sa Re Ga Ma or India‘s Best (Cinestar Ki Khoj). We short-listed 15 Indian players who we felt were the best. They played in the tri series. The fight they showed was commendable against a global bowling attack.

 
The flip side to ICL is that many cricket boards, including Pakistan, are peeved that cricketers were taken. Do you feel that this will negatively affect your ability to go after their TV rights?

I do not think that there is a conflict over here. The businesses are separate. If our bid is the highest, then it will come to us. A good price is what any board would look for. The best man wins. I don‘t think that the board will be concerned about who offers the

highest.
 
How is the relationship with Ten Sports working out?

We have been partners for a year and a half. It is working well. There is content sharing. We distribute Ten Sports. They handle our ad sales. The FPC is made by a central team. If there are clashes, then the programmes get split between the two channels.

The Uefa Champions League sometimes has two games at the same time. So we air one match. In fact, we started doing this before we partnered with them. This offers the power of two.

 
You are also doing an initiative Goal 2010. How did this idea come about and what progress has been made?

This came about when Fifa president Sepp Blatter came down to India. This sport has a huge potential. We are putting money into this sport and in a couple of years, we will start seeing the results. We do a lot of school soccer tournaments.

Our focus is at the grassroots level. We need to emerge as champions at the Asia level by 2010. We should be among the top five teams in Asia. Ten Sports airs domestic football in the Middle East. We are also working with the AIFF at tweaking the format of domestic football.

 
Is the appeal of soccer moving beyond the three states of Goa, Kerala and West Bengal?

Yes. It is getting popular in parts of states like Gujarat and Maharashtra.
 
Do you think corporatisation will help sports like soccer and hockey to move forward?

It can certainly help soccer. Hockey, however, is on a downturn not just in India but also abroad. In soccer, you have 32 teams playing the World Cup. In hockey just seven or eight teams play the event. Even in those countries the popularity is not as high as it should be.
 
How is Zee Sports faring on the distribution front?

The ICL has done us a lot of good. We have achieved 50 per cent connectivity. This rose from 25 per cent over the last three months.
 
What property acquisitions were recently made?

Zee and Ten Sports acquire things together. We renewed the West Indies cricket rights. We have the US Open tennis event for the long term.

India is a unique country in that there are several sports channels but only one sport dominates. In other countries there are only two sports channels but multiple sports are followed.

This is why the price of rights are going up dramatcially in India due to

competition.

 
Finally on the advertising front brands at the moment are not sure about how to use sport beyond cricket. Do you see this changing in the near future?

It is changing already. A lot of advertisers are going to Golf. Once the Indian advertisers start to understand the true value of sponsorship that goes beyond just TRP, things will change. The best example is what the EPL has done for Barclays.

This, though, has been built over several years. Indian companies are realising that they should invest in sport over a long term. The advertiser has to invest with the sports federation.

should invest in sport over a long term. The advertiser has to invest with the sports federation.

competition.

 
Finally on the advertising front brands at the moment are not sure about how to use sport beyond cricket. Do you see this changing in the near future?

It is changing already. A lot of advertisers are going to Golf. Once the Indian advertisers start to understand the true value of sponsorship that goes beyond just TRP, things will change. The best example is what the EPL has done for Barclays.

This, though, has been built over several years. Indian companies are realising that they should invest in sport over a long term. The advertiser has to invest with the sports federation.

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