The Indian Premier League (IPL) is seeking a clarification from Sony Entertainment Television (SET) on the matter related to the alleged discriminatory pricing practice followed by the channel for its on-air deals between BIG TV and rival Airtel DTH.
On Thursday, BIG TV, the DTH arm of the Reliance ADA Group, exited its Rs 137-crore, four-year deal with IPL. The company cited discrimination in pricing by Sony as the reason for its exit. BIG TV has already communicated its decision to IPL CEO Sundar Raman. "We have sought clarity from Sony regarding the current situation," confirmed Raman.
According to sources close to the development, the discriminatory pricing refers to the fact that Sony offered Airtel DTH one-fourth the price quoted to BIG TV for their on-air sponsorship deal. This despite the fact that BIG TV had the first right of refusal (FRoR) being the on-ground partner for IPL. A BIG TV spokesperson declined to comment on the matter.
Unlike last year, Sony is not offering any category exclusive on-air rights to advertisers for the upcoming IPL season. So any DTH company could pick up on-air sponsorship during the IPL matches on Sony. Airtel took advantage of Sony's non-exclusive clause to sign an on-air sponsorship. However, the discriminatory attitude of Sony in pricing has resulted in BIG TV refusing to be arm-twisted.
While BIG TV has decided to exit, Sony had re-opened discussions with BIG TV following talks with the Board of Control for Cricket in India (BCCI) earlier this week. According to the BCCI rules, the first right of refusal for on-air sponsorship is offered to the ground rights holder, in this case, Big TV.
With BIG TV's exit, IPL is set to lose out on Rs 137-crore deal it had signed with BIG TV for four years. Sony on the other hand may suffer a potential loss of Rs 120 crore over four years (averaging Rs 30 crore per year) on its on-air deal with BIG TV.
