Unbundled but united: What Disney-RIL merger means for IPL advertising

With their merger, Reliance Industries' Viacom18 and Disney's Star India are set to reshape advertising strategies across TV and digital platforms. But will this affect IPL, a premium IP, and the first major inventory the joint venture will sell as a single entity?

While both companies have assured the Competition Commission of India (CCI) that IPL 2025 ad slots will be sold separately for TV and digital, experts predict the JV will gain stronger negotiating power for better deals.

However, they caution that advertiser entry pricing may rise, with the JV likely dictating rates if both platforms—premium and freemium—continue to operate.

“The Disney-RIL merger means that the new entity could now be privy to deals on both platforms and may be in a stronger position to negotiate,” said Vinay Hegde, Chief Investment Officer, Madison Media.

“The new bigger entity’s expectation for entry pricing will be higher than before. And if both Hotstar and JioCinema are thrown into the ring, the combined might may help deliver better CPMs. TV may be under some pressure on the back of viewership and hence the pricing there may see some malleability,” he added.

Until last year, the television broadcast rights of IPL were with Disney Star while Viacom18 had the streaming rights.

As of last season, Disney Star charged between Rs 17 lakh and Rs 18 lakh per 10 seconds for both standard definition (SD) and high definition (HD) channels, while ad slots for the south feed ranged from Rs 7 lakh to Rs 8 lakh per 10 seconds. JioCinema on the other hand offered a host of flexible packages.

The value of IPL media rights has increased significantly, from Rs 8,200 crore in 2008 to Rs 48,390 crore in 2022.

In 2017, Star India had secured the IPL television and digital rights for Rs 16,347 crore through a consolidated bid for worldwide coverage. The rights, spanning from 2018 to 2022, made this the largest television deal in the history of cricket that time.

In June 2022, the Indian cricket board (BCCI) sold the IPL broadcasting rights for the 2023–2027 seasons to Star India and Viacom18 for a total of Rs 48,390 crore.

While Disney Star retained their Indian sub-continent TV rights with a figure of Rs 23,575 crore, digital rights deal was acquired for Rs 20,500 crore by Viacom18.

Advertising during IPL live streaming started at a cost of as low as Rs 25 CPM. The base pack for one day started at Rs 50,000 approximately offering 1.25 million impressions at Rs 40 CPM. For 5 million impressions, the cost went up to nearly Rs 2 lakh.

Mobile CPMs ranged from Rs 180 to Rs 300, depending on targeting, while CTV CPMs ranged from Rs 380 to Rs 700. For spot buys, mobile ad rates range from Rs 13 lakh to Rs 15 lakh per 10 seconds, and for CTV, they ranged from Rs 5.5 lakh to Rs 7 lakh per 10 seconds.

As the merger of Disney and Reliance comes through, in 2025, they will jointly sell IPL ad slots. However, following their commitment to the CCI, TV and digital ad slots will be sold separately, not bundled together.

Another expert in the know of developments said that while the separation of ad slots will not affect the proportion of investments but considering that viewership on digital has seen an upward trend which is expected to continue, there may be some shift to digital.

He said that Viacom18 will manage the inventory, selling products across two platforms based on advertiser needs. This positions them advantageously in the market by offering flexibility.

“If the user base for the IPL grows due to both Hotstar and JioCinema streaming it, CPMs could remain stable, leading to more impressions. Meanwhile, Connected TV (CTV) is expected to remain in high demand, resulting in higher pricing,” said the expert.

Experts believe that advertisers are likely to have anticipated the variation in viewership between TV and digital platforms, taking into account the data from the previous season.

Another expert observed that digital viewership numbers are expected to stay stable even if Disney+ Hotstar remains the primary streaming partner and is offered for free, similar to JioCinema.

Talking about challenges in managing campaigns across both platforms without bundled deals, Madison Media’s Hegde nodded in negative.

“Ideally, no. The fact remains that there is no common currency so the evaluation metrics and parameters are still specific to each medium. Reach is the common factor and that is where the bundling either for making the deal or later happens.

“However, with a single entity selling (Viacom), bundling could be more feasible from a product and sales point of view and facilitate where a client is looking to invest on both platforms. Also, levels of investments across the 2 platforms can be worked out better.

Viacom18 and Star India Pvt Ltd have agreed not to bundle television and OTT advertising slot sales for their cricketing rights—including the Indian Premier League (IPL), the International Cricket Council (ICC), and the Board of Control for Cricket in India (BCCI)—for the remaining tenure of their existing rights.

This agreement was noted by the Competition Commission of India (CCI) while approving the $8.5 billion merger in August this year, with the detailed order published recently. This decision aims to enhance competition in the advertising market and ensure fair access for advertisers.

On February 28, 2024, Star India Private Limited (Star India) entered into a binding definitive agreement with Reliance Industries Limited (RIL) and Viacom 18 Media Private Limited (Viacom 18), which is majority owned and controlled by RIL, to form a joint venture that will combine the businesses of Viacom18 and Star India consisting of entertainment and sports pay TV and free-to-air networks, DTC services, film and television content library and certain production businesses (the Star India Transaction).

RIL will have an effective 56% controlling interest in the joint venture with 37% held by the Company, and 7% by Bodhi Tree Systems, a third-party investment company.

The Star India Transaction is expected to close in the first half of 2025, subject to customary closing conditions, including regulatory approvals and government consents. If closing has not occurred by February 28, 2026, Star India or RIL may terminate the transaction.

The CCI noted that under ‘Schedule 3 - Commitments in Sports Segment’, the parties (RIL and Walt Disney) have submitted voluntary commitments and also provided certain voluntary clarifications to these commitments

“The Parties will not bundle together the TV ad slot sales for all three cricketing rights available with the Parties i.e., IPL, ICC and BCCI for the balance tenure of the existing rights, it noted. The parties will not bundle together OTT ad slot sales for all three cricketing rights available with the Parties i.e., IPL, ICC, and BCCI for the balance tenure of the existing rights,” the CCI noted while granting the approval in August this year.