The Indian Premier League (IPL) 2023 is set to be a major battleground not just on the cricket field, but also in the media world. The convergence of 4G mobile broadband, connected TV penetration, and fibre broadband adoption is driving this, with Jio Cinema emerging as a major player in live sports streaming.
Starting on March 31, IPL 2023 will be streamed free to millions of mobile broadband users and connected TV households in India. Media Partners Asia (MPA) expects total ad investment in IPL 2023 to be between $490-600 million, but ad budgets are under pressure due to macroeconomic headwinds.
Many advertisers have allocated budgets for the event, however, with demand particularly strong on digital platforms. FMCG budgets are expected to be split between TV and digital, with RIL-owned companies likely to allocate spend to Jio Cinema. Jio Cinema has promised advertisers a reach of 400 million and a concurrent user base of 100 million for IPL 2023.
The company has already hired a large part of the Disney+ Hotstar technical and engineering teams, and is expected to launch SVOD in 2H 2023, leveraging partnerships with Paramount+, Viacom18, Warner Bros. Discovery (WBD), and NBCU.
In total, Jio Cinema has roped in 500 advertisers for the 2023 IPL. Conquering CTV will be a challenge given distributor fragmentation and a significant level of customization required. MPA estimates the total CTV TAM in India at 70 million. MPA forecasts that Jio Cinema’s IPL 2023 penetration of this base will reach 20-30 million, driving CPMs and enhancing the consumer bond with multi camera angles, 12 languages, 4K resolution, live statistics and more.
Star, the incumbent rights holder for IPL, is struggling to keep pace with Jio, as well as a challenging macroeconomic environment. Pay-TV ad sales are expected to more than halve year on year to $200-220 million for IPL 2023, with subscription fees also likely to be significantly impacted.
Furthermore, Star has broadcast 12 important IPL matches over its free-to-air channel, which may cannibalize its subscription revenue. The drop in IPL TV viewership is also concerning, with reach falling from 267 million to 229 million year on year. In addition, Disney+ Hotstar is losing ground due to the absence of IPL and the termination of its partnership with Jio.
The Zee-Sony merger, set to take place in May 2023, is expected to create the most scaled and profitable broadcaster in India, surpassing Star India. As sports broadcasting becomes increasingly challenging, Star may also scale down its investments. Overall, IPL 2023 is set to be a crucial battleground in the media industry, as Jio Cinema and Star compete for viewership and ad revenue.
Meanwhile, India’s AVOD market reached US$2 billion in 2022 and is projected to grow at 18% CAGR over 2023-27 to reach US$4.5 billion. A large part of this incremental growth is expected to be fueled by supply of premium inventory coming from heavyweights like Jio Cinema, featuring IPL and other marquee sports, as well as SVOD powerhouses such Prime Video introducing AVOD tiers to go deeper. India’s AVOD revolution is just getting started.
View the full report of Media Partners Asia here