Star India has shelved its plan to sell the bulk of the Indian Premier League (IPL) advertising inventory to Sandeep Goyal, owner of Mogae Media, amid alleged resistance from rival agencies seeking to market the hottest property in world cricket. Earlier, Star India, which had acquired the global media rights of the cash-rich league for the next five years for a record Rs 16,437.5 crore, had brought on board Goyal, the former group chairman at Dentsu India, to sell ad inventory worth Rs 1,000 crore.
“IPL is one of the biggest properties and we are partnering multiple advertising agencies to maximise value. Sandeep (Goyal) is consulting with us on marketing IPL and assisting us on sales,” Sanjay Gupta, managing director, Star India, told ET last week, though he refused to divulge deal details. When ET spoke with heads of multiple media agencies, they confirmed Goyal has approached them, claiming to offer better rates. However, some agencies did not like the arrangement.
Ashish Bhasin, CEO, Dentsu Aegis Networks, said, “IPL is one of the most lucrative properties and this is the first time both TV and digital are being sold together… We will look for the best deal for clients and it is up to Star India to decide how it wants to sell.” Confirming his company was approached by Goyal, Bhasin added that Dentsu’s financial dealings will be with broadcaster (Star India) directly.
Another media agency executive, who did not wish to be named, said: “Goyal has been meeting agencies offering IPL inventory at a substantial advantage over market rates. Some big agencies did not want to negotiate with a third party as that would disintermediate media agencies. Now Star India has removed the offer and we will be negotiating with Star directly.”
According to Star India sources, the “best rates” were offered until January 26 if an agency would have committed a sizeable amount. “As there was too much of resistance from two large agencies, Goyal has decided to step back for now,” a source said.
Incidentally, Goyal had first devised this media trading model when he was heading the India business of Dentsu. Back in 2006-07, when Sony Pictures Entertainment (then Multi Screen Media) had ICC media rights, Goyal struck similar deals for Champions Trophy and ICC World Cup 2007. After the abysmal performance of Team India in the 2007 World Cup, Goyal tried a similar deal in the first season of IPL. However, industry bodies, the Advertising Agencies Association of India (AAAI) and the Indian Broadcasting Foundation (IBF), opposed the move and formed an ethics committee.
“Goyal’s model is simple, he underwrites inventory and commits a certain amount, which gives a breather to broadcasters. As a significant portion of inventory is already blocked, the broadcaster can safely increase rates, which also talks up the market and creates hype for the property. This is something media agencies did not want then — and don’t want now,” added another media agency executive.
Goyal refused to comment on the development, saying that he is off to Europe on a holiday. Without confirming his role in the IPL, he said: “I have always had an interest in media… At Mogae Media, every media monetisation opportunity is welcome.”
ET had first reported that Star India is targeting Rs 1,800 crore in ad sales from IPL 2018. The broadcaster has announced an exhaustive telecast plan, where IPL matches will be aired in six languages across seven different TV channels, and on Hotstar.
Source: Economic Times