MUMBAI: The World Cup will drive revenues of Sony into the Rs 10 billion mark this fiscal, MAX executive vice president and business head Rajat Jain claims.
Jain also asserted that the World Cup would ensure that the paid subscriber base of the Sony-Discovery bouquet rises from the current 10 per cent to around 20 per cent of its reach. According to Jain, Sony Entertainment has a reach of 33 million subscribers.
Jain said that historically the trend has been that in a year when the World Cup is on, 9 to 11 per cent of the total TV ad spend is what cricket carves out. Taking the upper range of 11 per cent, the TV ad spend that both Sony and national broadcaster Doordashan can together expect to rake in would be about Rs 3520 million (factoring indiantelevision.com's estimate of total TV ad spend this fiscal at Rs 32 billion). Jain was speaking on the sidelines of a press briefing where MAX announced its mega plans for the forthcoming World Cup
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This more or less ties in with expectations from media analysts that MAX would get around Rs 2 billion and DD-Nimbus Rs 1.5 billion in ad revenues out of this tournament.
Jain also mentioned that India accounted for 80 per cent of the entire global cricket advertising spend of Rs 10 billion per annum; a trend valid for those years in which the World Cup was being held. Little wonder why the ICC considers Indian audiences to be so important that all the match fixtures during future World Cups would be scheduled to prime time in India.
The Indian cricket team may not necessarily win the World Cup but the Indian audiences have definitely beaten the world before the first ball has been bowled.
Jain added that MAX was charging a hefty premium for the approximately 5000 seconds per match available for the 51 'live' matches. He claimed that the premium is comparable to what Star introduced when KBC became such a rage but media analysts dispute the claims.
Jain also debunked the threat of terrestrial channel DD easing away a substantial chunk of the total World Cup TV ad spend by claiming: "As far as TV spends are concerned, history shows that DD has always lagged behind the C&S channels. Ad agencies are also aware of the fact that DD's higher reach has never translated into higher consumer purchases. A person who cannot afford to buy a cable connection cannot afford buy many of the products being currently advertised on TV channels," Jain pointed out.
The total inventory available to advertisers is around 255,000 seconds and if Sony manages to get Rs 2 billion, then the average rate at which they sell the 10-seconds spots works out to Rs 78,431 (a rate that many advertisers and agencies would settle for). Agency sources claim that MAX had initially quoted a rate of around Rs 1,25,000 for a 10 second spot as MAX had initially targeted a total revenue of Rs 3 billion.
The Rs 3 billion mark is what Sony has publicly declared it will achieve but even according to media buyers who are more bullish on Sony's ad toplines for the World Cup, it will take some doing for it to manage the Rs 2.5 to Rs 2.6 billion figure.
Thus far, Sony has been touting the fact that it will not budge on its rates, but it remains to be seen who will blink first, Sony or the advertisers. That in the end could well determine whether it comes out of this World Cup with Rs 2.5 to Rs 2.6 billion in its ad kitty or has to settle for something closer to the Rs 2 billion number some buyers are putting out.
