Ambani bats for cricket glory as Disney scales back in India #Ecommerce - The Entrepreneurial Way with A.I.

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Friday, March 31, 2023

Ambani bats for cricket glory as Disney scales back in India #Ecommerce

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Mukesh Ambani’s Jio, the South Asian telecom powerhouse, has long sought to entice its customer base with a plethora of services aimed at boosting subscriber retention. Despite amassing over 425 million customers and claiming the mantle of India’s top network provider—due in large part to its aggressively competitive data pricing—Jio’s array of additional services has yet to gain significant traction.

With the highly anticipated Indian Premier League (IPL) cricket tournament starting later today, Ambani is eyeing this as the perfect opportunity to revamp Jio’s service adoption strategy.

Viacom18 – a venture between Ambani’s Reliance and Paramount – outbid Disney to secure five years of IPL’s streaming rights for the Indian subcontinent region with a sum of $3 billion. Unlike Disney’s Hotstar, which restricted access to IPL streaming to paid subscribers in recent seasons, Viacom18 is opening the floodgates for IPL games to everyone on the Jio network.

In a move that proved transformative, Star India executives Ajit Mohan and Uday Shankar’s strategic investment in cricket streaming nearly a decade ago catapulted Hotstar to prominence as a household name. The platform drew over 100 million digital viewers during the two-month-long event year after year, with cricket alone solidifying Hotstar’s position at the pinnacle of the market.

Star India’s Hotstar was a crown jewel in Fox’s large portfolio in the $71 billion acquisition by Disney, prompting the Mickey Mouse company to expand the service to many international markets.

However, Disney’s decision last year to relinquish digital streaming bids in favor of securing television broadcast rights under the leadership of former CEO Bob Chapek left many industry insiders perplexed. The company has also decided not to renew the licensing rights for HBO content in India in a move that has understandably frustrated many Hotstar subscribers.

In 2016, as Reliance prepared to launch Jio, the company emerged as the first telecom operator to believe in Hotstar’s vision and commit to collaboration, according to a source familiar with the discussions. Disney reaped significant benefits from Jio’s competitively priced data plans, which enabled tens of millions of Indian consumers to alter their internet consumption habits virtually overnight.

Now, it appears that Reliance is shifting gears and focusing on its own interests.

Jio has been assertively recruiting talent from Disney’s Hotstar, restructuring its infrastructure to accommodate a large user base. The company plans to provide 16 distinct feeds for IPL matches, featuring ultra-HD resolution – a first for cricket in India – and coverage in 12 languages.

Analyst group Media Partners Asia estimates that Jio Cinema, where Viacom18 plans to stream matches, will be able to drive sales of up to $350 million during the IPL season this year, up from $128 million in digital sales in 2022. The group marked down advertising sales on pay TV to $220 million, from $442 million last year.

“The US$550 mil. number across digital and pay-TV is marginally flat Y/Y and represents a steep loss against annualized 2023-27 IPL rights fees of US$1.2 bil. Subscription fees are expected to be very modest this year because of challenges on pay-TV distribution and the lack of a subscription fee on digital,” it wrote in a report.

Reliance has “promised” advertisers that cricket streaming on Jio Cinema will reach 400 million users, said Media Partners Asia. Jio Cinema has also promised a concurrent user base of 100 million, nearly four times of the current records, the analyst group added.

Nonetheless, this underscores a considerable leap for Jio Cinema, which currently boasts fewer than 30 million monthly active users, as per data from mobile intelligence firm Sensor Tower. This is despite the fact that over 400 million Jio subscribers are eligible to access Jio Cinema at no extra charge.

Numerous industry executives have expressed skepticism regarding the likelihood of such a significant number of users transitioning to streaming on their smartphones when they have the option of watching games on their satellite televisions.

Additionally, whether Jio Cinema can effectively manage the technical demands of tens of millions of viewers tuning in to cricket matches remains an open question for the time being.

Ambani bats for cricket glory as Disney scales back in India by Manish Singh originally published on TechCrunch



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Manish Singh, Khareem Sudlow