Thursday, 4th January 2007

SPORTS SHORTS

* Soccer’s European champions Greece will face South Korea in an international friendly in England on February 6. The game will be played at Craven Cottage, home of top-tier English Premiership club Fulham. Source: Sportcal, 3rd January 2007

* Mobile value added services industry in India could be worth Rs 45.6 billion by the end of 2007, from its current Rs 28.5 billion, according to findings by the Internet And Mobile Association of India and IMRB International. Breaking down the Rs 28.5 billion reveals that text messaging dominates with Rs 11.4 billion, followed by ringtones and caller ring back tones at Rs 10.26 billion; Person to Application and Application to Person at Rs 4.28 billion; games and data at Rs 1.71 billion and others (MMS etc) at Rs 860 million. Source: Indian Television, 3rd January 2007

* Quattro Media is distributing live coverage of the World Football Gala taking place in Austria on January 8. The event, organised by the International Federation of Football History and Statistics (IFFHS) in co-operation with FIFA, will take place at the House of Mozart in Salzburg. Quattro Media is co-ordinating all licence contracts as well as co and host production agreements. Source: Sports Media, 3rd January 2007

* 2007 could mark futsal’s breakthrough into becoming a major sport in Europe. The Portuguese city of Porto will host the sixth UEFA European Futsal Championships in November and the tournament is set to be the biggest yet, with qualifying getting underway this month. UEFA divisions that usually deal with the top football competitions are now involved in the project for the first time. Member associations are now aware of the growing demand for futsal in respective countries, and most of them have now initiated activities. Source: Sports Media, 3rd January 2007


MORE NEWS

Asia/New Media: Mobile Video to Boost Mobile Sports Market

Increasing influence of mobile video enabled on 3G networks will drive the uptake of many mobile sports, leisure and information services over the next five years. According to Juniper Research, global market for sports, leisure and information content will grow from just under $4.2 billion in 2006 to $9.5 billion by 2011.

Europe is expected to be the largest market, accounting for 40 per cent of revenues between 2006 and 2011. Asia Pacific will account for 33 per cent and North America for 18 per cent. Higher price levels will make Europe the largest revenue generator ahead of Asia Pacific despite the Asian region generating the most infotainment traffic over the period.

Types of services that will benefit from enhanced video capability include sports services, services based around TV shows and celebrities, traffic update services, news services and community applications with user generated content. Growth in sports services and services with user generated content should be particularly strong. Source: Sport Business, Advanced Television, Market Wire, 3rd January 2007

China/General: CCTV Dresses In Li-Ning

Presenters on China’s main sports channel are wearing Li-Ning apparel under a new deal between sportswear producer Li-Ning Company and China Central Television’s CCTV5. The channel’s personalities will be attired in Li-Ning products on screen until the end of 2008. The company, set up by former Olympic gymnastics champion Li Ning, is also official sponsor of several of China's Olympic national teams.

CCTV is starting its push toward the Beijing 2008 Olympics, with CCTV5 being a window to preparations for the Games. Jiang Heping, director of the channel, said it would launch new programmes devoted to the Games, including more Olympic-themed news features. A new show, My Olympics, will highlight important Olympic figures. CCTV and the State General Administration of Sport will work together on a long documentary on the Beijing Olympics.

Meanwhile, construction of Beijing’s new Television Cultural Center (TVCC) was completed on Friday, the Beijing News reported. The TVCC is part of a new complex (540,000 square metres in total) housing the new CCTV headquarters. The TVCC includes a hotel, a visitor's centre, a large public theatre and exhibition spaces. Source: Sports Media, 3rd January 2006

Elsewhere/Business: IMG Acquires Tennis Week and Tennisweek.Com

IMG has acquired Tennis Week magazine, adding to its growing stable of publications. Under the deal has also acquired online news site tennisweek.com. The transaction closed on December 22, 2006. Terms were not disclosed.

Tennis Week has a circulation of 60,000 subscribers and provides in-depth reports on the sport. It also owns or manages more than 20 major tournaments around the world including the China Open and the Chennai Open and is involved in the organisation of the Wimbledon Championships. It is seen as a good fit for IMG, which represents many players, including Roger Federer, Rafael Nadal, James Blake and Maria Sharapova.

Tennisweek.com provides instant coverage of the Grand Slams, the ATP and WTA Tours, in addition to major collegiate, junior and senior events. It reaches millions of visitors annually with up-to-the-minute scores, rankings, earnings, schedules, tournament draws and camps. IMG plans to launch a fully re-conceptualized first issue of Tennis Week in mid-March with a schedule of six glossy, perfect-bound, 100+ page issues in 2007. Source: Sport Business, Mediaweek, Sportcal, 3rd January 2007

Elsewhere/Business: Long-awaited Agency MBO ‘Imminent’

Octagon CSI said that a management buyout separating it from parent company Octagon, the sports marketing agency owned by US advertising giant Interpublic, is ‘imminent.’ Octagon announced in October 2006 that a buyout of Octagon CSI, its television arm, was expected to be finalised by the end of the year. Octagon said today that there was ‘no new news’ but that talks are ongoing and a deal is ‘imminent.’Chris Guinness, Octagon CSI's chief executive, said last year that the members of the management team involved in the buyout were funding it themselves. The buyout is the culmination of mutual disenchantment between Octagon CSI and Interpublic which first surfaced with the advertising group’s refusal to give financial backing for guarantees that Octagon CSI was required to make in order to land media rights contracts. Source: Sportcal, 3rd January 2007


ARTICLES, COMMENTS & OPINIONS

Nothing can beat cricket - Q&A with R C Venkateish, MD of ESPN Software (India) Pvt Ltd

At one time, ESPN-Star Sports was the undisputed leader of cricket broadcasting in India. Then new kids on the block like Sony (that have the rights for the 2003 and 2007 World Cups), Zee (that bid $219.15 million for non-ICC matches played on neutral territories) and Nimbus Communications (that bid $612.18 million for a four-year contract of BCCI-owned properties) realised this is where the big bucks were, and started outbidding ESPN-Star Sports for major cricketing rights.

A fortnight ago, ESPN-Star Sports silenced its competitors by bidding $1.1 billion to acquire 18 ICC tournaments from 2008 to 2015 that includes two World Cups (2011 and 2015), a minimum of three Champions Trophies, two Twenty20 World Championships, four ICC under-19 World Cups and a Women’s World Cup. Excerpts of Interview by Surajeet Das Gupta and Nayantara Rai on Business Standard, 29th December 2006:

Q: Have you overbid?
A: Not at all. We do not blow our brains and buy out properties. There is always a detailed business plan behind each and every one of our bids. We are a responsible joint venture company and answerable to our shareholders.

Q: How is it commercially viable?
A: The 18 major tournaments include two ICC World Cups, two Twenty20 World Championships, three Champions Trophy, Intercontinental Cup, four under-19 World Cups and a Women’s World Cup. The time frame of the contract is eight years, allowing us to leverage these properties over a large period of time. A broadcaster makes around $2 million from an ODI today. It’s only going to go up, let’s see by how much by 2015. With this acquisition, we are projecting high double-digit growth in the next three years. You must also evaluate our bid in the context of the increasing household economy.

Q: How will your advertising revenue be affected?
A: We are looking at signing up advertisers who make big commitments to the channel. We are looking at 8 to 10 major advertising partners in tranches of two to three years. That would represent 60-70 per cent of our advertising pie from the properties we have won. TRPs based on cricket swing between six to 15 depending on the performance of the Indian team.

Q: What kind of revenue does the 60-70 per cent of the pie represent?
A: Early days for that but I would imagine around $10-20 million per series. Sometimes, what would happen earlier was that the broadcast rights would be given out too late. But this contract is for eight years — so we have more than enough time to chalk out an excellent business plan.

Q: What about revenues from CAS?
The matter is sub judice but we are unhappy about it. It’s unfair to give channels at Rs 5 — we’re being forced to sell in prime areas like Delhi, Mumbai and Kolkata at the same price of bidi packets. Obviously we are taking a significant hit. We have made a case to Trai that sports channels should be treated differently. A channel that bid $1.1 billion for cricket rights is being sold at the same price as religious and comedy channels.

Q: How will mandatory sharing of feed with DD impact you?
Ten Sports got an injuction in the case of the India versus West Indies series. Zee Sports also did not share the DLF Cup. Hopefully, we are moving towards a free market economy!

Q: You had lost cricket to newer players. How tough was that?
It was a testing period. But we discovered the strength of our basic brands. We still had the English Premier League, Formula 1 and tennis grand slams — that’s why we recorded double-digit growth even then. We are very happy with what we did with hockey — we are trying to build assets like hockey but this takes time. We did the same thing with the English Premier League (EPL). And recently, we renewed our rights for EPL and the Euro 2008.

Q: What are the new areas you’re looking at?
A: We have taken a lead in that. ESPN Mobile has already been launched [major networks like Airtel and Hutch give users news, exclusive interviews, scores and video clips from ESPN’s team of experts for rates that vary from Rs 50 to 100 a month]. We are increasing our presence on the Internet. Bandwidth is increasing, and that provides with newer opportunities that we must integrate with wireless. We have a separate business group for mobile and Internet now.