Sports channels to earn Rs 28 bn ad revenue over 14 months

[khurramdar]

Sports channels to earn Rs 28 bn ad revenue over 14 months



MUMBAI: The coming 14 months will prove to be a bonanza for sports channels.

According to B&K Securities, Rs 27.92 billion of TV ad revenues will be consumed by sports channels, surpassing the earlier period's sports related advertising figure of Rs 10 billion by a big mile.

Sony is expected to gain massively with two new IPL franchises coming in next year. The official IPL broadcaster is expected to make Rs 6.4 billion this year. In 2011, the B&K study suggests that IPL will rake in Rs 8.7 billion.

ESPN Star Sports, in comparison, will only earn Rs 318 million from the Champions Twenty20 League. It is estimated to earn Rs 3.9 billion from the World Cup next year, according to the report.



The report notes that this will negatively impact Hindi general entertainment channels (GECs) and to some extent the regional GECs as advertiser’s profile (and to some extent the viewer's profile) across Hindi GECs and sports categories is similar. The study expects Zee Entertainment and Sun TV to be negatively impacted.

Zee Entertainment, which owns Ten Sports, will, however, be compensated to some extent as it will telecast two cricketing series featuring India. 242 days of cricket in the next 420 days (March 2010 - April 2011) could have some negative bearing on multiplexes as well.

Meanwhile, there will also be a positive impact on:

News channels (NDTV, Zee News, TV Today) could be positively impacted as they will have many more sporting events to talk about in FY11E.

DTH companies should show robust subscriber additions (aided by more TV sales).

Outdoor advertising, radio advertising and to some extent print advertising

The study says that this prognosis stems from the fact that heavy advertisers on the Hindi GECs like auto, telecom, food and beverages, consumer goods and BFSI move their ad-spends to a cricketing property, if India is playing and performing well.

As a case in point, in the year 2003, when India reached the finals of the Cricket World Cup 2003, advertising share of sports genre jumped to 13 per cent (+10 per cent from 2.7 per cent in 2002) of the total TV ad-pie and this came at the cost of the Hindi mass entertainment (now re-christened as Hindi GEC) channels, ad-share of which fell to 47 per cent (-10 per cent from 57 per cent in 2002).