 "The torchbearer of linear content: Live-action sports")
February 27, 2011, like the rest of the country, I was glued to my living room DTH TV set as England went about nonchalantly chasing what looked like an unobtainable 338 runs scored by India in the Cricket World Cup match. After Zaheer Khan had got India back in the reckoning, England still needed 14 runs from the final over, I was sitting at the edge of my sofa, biting my fingernails. Down to the wire, two runs needed from the final ball.
As I see Munaf Patel at the top of his run-up ready to bowl the final ball of the match, suddenly my neighbourhood (mostly on cable TV) erupts with excitement of a tied match!! I see the same being played out on my TV three seconds later; DTH latency issues - this is not on. I felt cheated, SACRILEGE!! Those three seconds reinforced in me the power of 'live-action' sports and the relevance of linear content in an increasingly digital environment.
Linear TV content is where a viewer has to watch a scheduled TV programme at a particular time on a particular channel. Given the increasingly hectic life we all live, it becomes impossible to keep up with one's favourite TV shows and this trend is likely to get accentuated in the future. A recent report by consumer insights firm, Experian Marketing Services, revealed that 6.5 per cent of American cable homes have "cut the cable cord." And why not? Over-the-top (OTT) services like Netflix and Hulu Plus, with their impressive content libraries are increasing drawing subscribers towards them and away from expensive pay TV packages. The only exception to this trend is Live-action sports. After all, while it is entirely conceivable to watch your favourite saas-bahu saga or reality show or talk show a few hours or days later, no sports fan can imagine forgoing a 'live' event for its highlights - it is just not the same! The on-going digitisation of the pay TV industry in India has fuelled the recent mushrooming of 'leagues' in various sports, including hockey, tennis, badminton and kabaddi and the high cost of acquiring TV, digital media rights of leading content.
Media rights of sports are increasingly being re-rated upwards and sponsorship rates are mirroring this trend. In 2012,contrary to popular perception, PepsiCo's winning IPL title sponsorship at Rs 400 crore was almost double the 2008 sponsorship deal with DLF. Vodafone and Hero Motor Corp emerged as title sponsors for the newer Indian Badminton League and Hockey India League respectively. Clearly, if the share of non-linear consumption of media increases, fiction-based programming ad-rates will come under pressure. One will see a shift towards high-impact advertising like product launches, festival sales and breaking the clutter campaigns during the more expensive live-action sports events,whereas most FMCG brand-reinforcing campaigns, will continue with fiction-based programming.
With the mushrooming of various sports leagues in the country, the viewer and the advertiser will now also have more choice. As for me, I will be glued to my Cable TV set in the children room (no DTH), as the Indian team embarks on its campaign for the ICC World Cup 2015.
As I see Munaf Patel at the top of his run-up ready to bowl the final ball of the match, suddenly my neighbourhood (mostly on cable TV) erupts with excitement of a tied match!! I see the same being played out on my TV three seconds later; DTH latency issues - this is not on. I felt cheated, SACRILEGE!! Those three seconds reinforced in me the power of 'live-action' sports and the relevance of linear content in an increasingly digital environment.
Linear TV content is where a viewer has to watch a scheduled TV programme at a particular time on a particular channel. Given the increasingly hectic life we all live, it becomes impossible to keep up with one's favourite TV shows and this trend is likely to get accentuated in the future. A recent report by consumer insights firm, Experian Marketing Services, revealed that 6.5 per cent of American cable homes have "cut the cable cord." And why not? Over-the-top (OTT) services like Netflix and Hulu Plus, with their impressive content libraries are increasing drawing subscribers towards them and away from expensive pay TV packages. The only exception to this trend is Live-action sports. After all, while it is entirely conceivable to watch your favourite saas-bahu saga or reality show or talk show a few hours or days later, no sports fan can imagine forgoing a 'live' event for its highlights - it is just not the same! The on-going digitisation of the pay TV industry in India has fuelled the recent mushrooming of 'leagues' in various sports, including hockey, tennis, badminton and kabaddi and the high cost of acquiring TV, digital media rights of leading content.
Media rights of sports are increasingly being re-rated upwards and sponsorship rates are mirroring this trend. In 2012,contrary to popular perception, PepsiCo's winning IPL title sponsorship at Rs 400 crore was almost double the 2008 sponsorship deal with DLF. Vodafone and Hero Motor Corp emerged as title sponsors for the newer Indian Badminton League and Hockey India League respectively. Clearly, if the share of non-linear consumption of media increases, fiction-based programming ad-rates will come under pressure. One will see a shift towards high-impact advertising like product launches, festival sales and breaking the clutter campaigns during the more expensive live-action sports events,whereas most FMCG brand-reinforcing campaigns, will continue with fiction-based programming.
With the mushrooming of various sports leagues in the country, the viewer and the advertiser will now also have more choice. As for me, I will be glued to my Cable TV set in the children room (no DTH), as the Indian team embarks on its campaign for the ICC World Cup 2015.
The author is MD, Ambit Corporate Finance