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MUMBAI: Agreeing to sell Ten Sports to Sony Pictures Networks for $385 million (about Rs 2,578 crore), Subhash Chandra-promoted Zee Entertainment Enterprises Ltd (ZEEL) has decided to exit from the sports business to focus on five growth engines.
ZEEL has signed a non-compete clause with Sony for four years, which implies that it can theoretically re-enter the sports market after taking a long holiday. Until that occasion of possible future return, it will invest in the five verticals of broadcast, digital, films, live events and international business.
With ZEEL leaving the sports field vacant, Star India and Sony will now pull all their resources to acquire rights, fight for market share and make the ecosystem favourable for pay TV income. Consolidation and a two-player market will put pressure on distribution platforms like cable TV and direct-to-home (DTH) to increase their payouts to the two sports broadcasters.
National multi-system operators (MSOs), who have made use of digital addressable system (DAS) to consolidate their market share, will have the muscle power to control content cost. However, independent and small-sized MSOs will have to struggle against wild inflationary pressures on content. This will further fuel consolidation in the cable TV sector.
The DTH sector is making its first moves towards consolidation. Essel Group-owned Dish TV and Videocon d2h are in talks to merge, creating a mammoth subscriber base of over 27 million. It remains to be seen if the deal consummates and Dish TV is able to acquire Videocon d2h in a stock and cash deal.
The TV broadcast map is being redrawn. ZEE is moving to a model like Mukesh Ambani’s TV18 Broadcast. Sans sports, the two giants have a wide swathe of entertainment and news channels. They also have movie production, OTT and live events in their footprint.
Star India, a wholly owned subsidiary of Rupert Murdoch-controlled 21st Century Fox, and Sony Pictures Networks India (SPNI) will be similarly positioned, with presence in both sports and non-sports broadcasting. SPNI will, however, have to enter regional-language broadcasting to enjoy a larger footprint like Star does in India.
Till such time ZEE said goodbye to sports broadcasting, Chandra’s media empire resembled that of Murdoch’s. In yesteryears, the two towering personalities fought for TV audience share in sports, Hindi and regional-language markets, while in terms of distribution they competed for DTH and cable TV subscribers. Star retrenched from cable TV business in 2012 when it sold its stake in Hathway Cable & Datacom to focus on Tata Sky, the DTH joint venture company with Tata Group as a majority partner.
Deal Factsheet
Non-compete period of 4 years
All-cash deal. Sony to make payment at one go after closure of deal
Transaction and tax costs in the range of 5–10%
Deal likely to close in next 4–5 months
Some sports contracts require no objection certificates from respective boards. ZEE will need that. Transfer of rights not to be a problem due to Sony’s global credibility
ZEEL to use cash to invest in 5 verticals. It will seek board’s approval for early redemption of preference shares as a possible route to return excess cash to shareholders
Not to buy RBNL as radio biz allows FDI of 49%
Deal value does not include proceeds from two ongoing court cases with BCCI. If decision is in favour of ZEE, the benefit will go to the company and not move to Sony. ZEE could gain Rs 50 crore (including interest) from BCCI and another Rs 124 crore (excluding interest)
Ten Sports’ contribution to ZEEL’s total subscription revenue is in mid-teens.
Closing down loss-making channels is not new to ZEEL, though many doubted the company would ever let go of the sports business, which is viewed by many as a deep asset with strategic value. Last year, ZEEL pulled the shutters on 9X and Zee Premier while Zee Trendz and ETC Punjabi stopped airing in 2014. Zee Gujarati and Zee Next shut shop in 2009.
Television
How the $385 mn Sony-Ten Sports deal is redrawing the TV broadcast map
Posted on: 01/09/2016 09:10 AM Sibabrata Das
MUMBAI: Agreeing to sell Ten Sports to Sony Pictures Networks for $385 million (about Rs 2,578 crore), Subhash Chandra-promoted Zee Entertainment Enterprises Ltd (ZEEL) has decided to exit from the sports business to focus on five growth engines.
ZEEL has signed a non-compete clause with Sony for four years, which implies that it can theoretically re-enter the sports market after taking a long holiday. Until that occasion of possible future return, it will invest in the five verticals of broadcast, digital, films, live events and international business.
With ZEEL leaving the sports field vacant, Star India and Sony will now pull all their resources to acquire rights, fight for market share and make the ecosystem favourable for pay TV income. Consolidation and a two-player market will put pressure on distribution platforms like cable TV and direct-to-home (DTH) to increase their payouts to the two sports broadcasters.
National multi-system operators (MSOs), who have made use of digital addressable system (DAS) to consolidate their market share, will have the muscle power to control content cost. However, independent and small-sized MSOs will have to struggle against wild inflationary pressures on content. This will further fuel consolidation in the cable TV sector.
The DTH sector is making its first moves towards consolidation. Essel Group-owned Dish TV and Videocon d2h are in talks to merge, creating a mammoth subscriber base of over 27 million. It remains to be seen if the deal consummates and Dish TV is able to acquire Videocon d2h in a stock and cash deal.
The TV broadcast map is being redrawn. ZEE is moving to a model like Mukesh Ambani’s TV18 Broadcast. Sans sports, the two giants have a wide swathe of entertainment and news channels. They also have movie production, OTT and live events in their footprint.
Star India, a wholly owned subsidiary of Rupert Murdoch-controlled 21st Century Fox, and Sony Pictures Networks India (SPNI) will be similarly positioned, with presence in both sports and non-sports broadcasting. SPNI will, however, have to enter regional-language broadcasting to enjoy a larger footprint like Star does in India.
Till such time ZEE said goodbye to sports broadcasting, Chandra’s media empire resembled that of Murdoch’s. In yesteryears, the two towering personalities fought for TV audience share in sports, Hindi and regional-language markets, while in terms of distribution they competed for DTH and cable TV subscribers. Star retrenched from cable TV business in 2012 when it sold its stake in Hathway Cable & Datacom to focus on Tata Sky, the DTH joint venture company with Tata Group as a majority partner.
Deal Factsheet
Non-compete period of 4 years
All-cash deal. Sony to make payment at one go after closure of deal
Transaction and tax costs in the range of 5–10%
Deal likely to close in next 4–5 months
Some sports contracts require no objection certificates from respective boards. ZEE will need that. Transfer of rights not to be a problem due to Sony’s global credibility
ZEEL to use cash to invest in 5 verticals. It will seek board’s approval for early redemption of preference shares as a possible route to return excess cash to shareholders
Not to buy RBNL as radio biz allows FDI of 49%
Deal value does not include proceeds from two ongoing court cases with BCCI. If decision is in favour of ZEE, the benefit will go to the company and not move to Sony. ZEE could gain Rs 50 crore (including interest) from BCCI and another Rs 124 crore (excluding interest)
Ten Sports’ contribution to ZEEL’s total subscription revenue is in mid-teens.
How the 5 mn Sony-Ten Sports deal is redrawing the TV broadcast map | TelevisionPost.com
ZEEL has signed a non-compete clause with Sony for four years, which implies that it can theoretically re-enter the sports market after taking a long holiday. Until that occasion of possible future return, it will invest in the five verticals of broadcast, digital, films, live events and international business.
With ZEEL leaving the sports field vacant, Star India and Sony will now pull all their resources to acquire rights, fight for market share and make the ecosystem favourable for pay TV income. Consolidation and a two-player market will put pressure on distribution platforms like cable TV and direct-to-home (DTH) to increase their payouts to the two sports broadcasters.
National multi-system operators (MSOs), who have made use of digital addressable system (DAS) to consolidate their market share, will have the muscle power to control content cost. However, independent and small-sized MSOs will have to struggle against wild inflationary pressures on content. This will further fuel consolidation in the cable TV sector.
The DTH sector is making its first moves towards consolidation. Essel Group-owned Dish TV and Videocon d2h are in talks to merge, creating a mammoth subscriber base of over 27 million. It remains to be seen if the deal consummates and Dish TV is able to acquire Videocon d2h in a stock and cash deal.
The TV broadcast map is being redrawn. ZEE is moving to a model like Mukesh Ambani’s TV18 Broadcast. Sans sports, the two giants have a wide swathe of entertainment and news channels. They also have movie production, OTT and live events in their footprint.
Star India, a wholly owned subsidiary of Rupert Murdoch-controlled 21st Century Fox, and Sony Pictures Networks India (SPNI) will be similarly positioned, with presence in both sports and non-sports broadcasting. SPNI will, however, have to enter regional-language broadcasting to enjoy a larger footprint like Star does in India.
Till such time ZEE said goodbye to sports broadcasting, Chandra’s media empire resembled that of Murdoch’s. In yesteryears, the two towering personalities fought for TV audience share in sports, Hindi and regional-language markets, while in terms of distribution they competed for DTH and cable TV subscribers. Star retrenched from cable TV business in 2012 when it sold its stake in Hathway Cable & Datacom to focus on Tata Sky, the DTH joint venture company with Tata Group as a majority partner.
Deal Factsheet
Non-compete period of 4 years
All-cash deal. Sony to make payment at one go after closure of deal
Transaction and tax costs in the range of 5–10%
Deal likely to close in next 4–5 months
Some sports contracts require no objection certificates from respective boards. ZEE will need that. Transfer of rights not to be a problem due to Sony’s global credibility
ZEEL to use cash to invest in 5 verticals. It will seek board’s approval for early redemption of preference shares as a possible route to return excess cash to shareholders
Not to buy RBNL as radio biz allows FDI of 49%
Deal value does not include proceeds from two ongoing court cases with BCCI. If decision is in favour of ZEE, the benefit will go to the company and not move to Sony. ZEE could gain Rs 50 crore (including interest) from BCCI and another Rs 124 crore (excluding interest)
Ten Sports’ contribution to ZEEL’s total subscription revenue is in mid-teens.
Closing down loss-making channels is not new to ZEEL, though many doubted the company would ever let go of the sports business, which is viewed by many as a deep asset with strategic value. Last year, ZEEL pulled the shutters on 9X and Zee Premier while Zee Trendz and ETC Punjabi stopped airing in 2014. Zee Gujarati and Zee Next shut shop in 2009.
Television
How the $385 mn Sony-Ten Sports deal is redrawing the TV broadcast map
Posted on: 01/09/2016 09:10 AM Sibabrata Das
MUMBAI: Agreeing to sell Ten Sports to Sony Pictures Networks for $385 million (about Rs 2,578 crore), Subhash Chandra-promoted Zee Entertainment Enterprises Ltd (ZEEL) has decided to exit from the sports business to focus on five growth engines.
ZEEL has signed a non-compete clause with Sony for four years, which implies that it can theoretically re-enter the sports market after taking a long holiday. Until that occasion of possible future return, it will invest in the five verticals of broadcast, digital, films, live events and international business.
With ZEEL leaving the sports field vacant, Star India and Sony will now pull all their resources to acquire rights, fight for market share and make the ecosystem favourable for pay TV income. Consolidation and a two-player market will put pressure on distribution platforms like cable TV and direct-to-home (DTH) to increase their payouts to the two sports broadcasters.
National multi-system operators (MSOs), who have made use of digital addressable system (DAS) to consolidate their market share, will have the muscle power to control content cost. However, independent and small-sized MSOs will have to struggle against wild inflationary pressures on content. This will further fuel consolidation in the cable TV sector.
The DTH sector is making its first moves towards consolidation. Essel Group-owned Dish TV and Videocon d2h are in talks to merge, creating a mammoth subscriber base of over 27 million. It remains to be seen if the deal consummates and Dish TV is able to acquire Videocon d2h in a stock and cash deal.
The TV broadcast map is being redrawn. ZEE is moving to a model like Mukesh Ambani’s TV18 Broadcast. Sans sports, the two giants have a wide swathe of entertainment and news channels. They also have movie production, OTT and live events in their footprint.
Star India, a wholly owned subsidiary of Rupert Murdoch-controlled 21st Century Fox, and Sony Pictures Networks India (SPNI) will be similarly positioned, with presence in both sports and non-sports broadcasting. SPNI will, however, have to enter regional-language broadcasting to enjoy a larger footprint like Star does in India.
Till such time ZEE said goodbye to sports broadcasting, Chandra’s media empire resembled that of Murdoch’s. In yesteryears, the two towering personalities fought for TV audience share in sports, Hindi and regional-language markets, while in terms of distribution they competed for DTH and cable TV subscribers. Star retrenched from cable TV business in 2012 when it sold its stake in Hathway Cable & Datacom to focus on Tata Sky, the DTH joint venture company with Tata Group as a majority partner.
Deal Factsheet
Non-compete period of 4 years
All-cash deal. Sony to make payment at one go after closure of deal
Transaction and tax costs in the range of 5–10%
Deal likely to close in next 4–5 months
Some sports contracts require no objection certificates from respective boards. ZEE will need that. Transfer of rights not to be a problem due to Sony’s global credibility
ZEEL to use cash to invest in 5 verticals. It will seek board’s approval for early redemption of preference shares as a possible route to return excess cash to shareholders
Not to buy RBNL as radio biz allows FDI of 49%
Deal value does not include proceeds from two ongoing court cases with BCCI. If decision is in favour of ZEE, the benefit will go to the company and not move to Sony. ZEE could gain Rs 50 crore (including interest) from BCCI and another Rs 124 crore (excluding interest)
Ten Sports’ contribution to ZEEL’s total subscription revenue is in mid-teens.
How the 5 mn Sony-Ten Sports deal is redrawing the TV broadcast map | TelevisionPost.com
