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					BCCI CHANNEL
A FEASIBILITY STUDY
PROPOSAL


To establish an autonomous body/public
limited company to fully exploit the
potential of BCCI cricket in particular and
promote the sport of cricket in India in
general.
WHAT WILL THIS ENTITY DO?

 To launch a premier 24/7 hour cricket related channel.
 Promote the cause of domestic cricket league.
 Exploit the full potential of Indian cricket among the South
  Asian diaspora spread around the world (i.e.; UK/Europe,
   US/Canada and the Caribbean's, Australia/New Zealand and Far
   East and Middle East and Africa.
 Explore alternate media to generate other business
  opportunities (Radio broadcast, internet and web streaming and
   other emerging media.)
 Generate    opportunities  in  allied   activities   like
  merchandising, event management and franchising etc.
 BENEFIT TO BCCI & VARIOUS STATE
 CRICKET ASSOCIATIONS?

 Need to review the business with a fresh outlook to realise
  the full potential of cricket.
 To maximize the revenues generated from sports rights to
  enhance viewership, brand appeal and additional sources of
  revenue.
 Review the BCCI’s contribution to the promotion of the
  sport of cricket in India, in terms of infrastructure, revenue
  and popularity of the game, and move ahead from its
  yeoman’s service.
 BENEFIT TO BCCI & VARIOUS STATE
 CRICKET ASSOCIATIONS?

Our proposal to BCCI:
 Consider launching a cricket channel in India
 To realize the full potential of revenues so generated
 To plough revenues so generated back into the affiliate
  associations, cricketers present and past and in upgrading
  cricket infrastructure in India.
 Further strengthen BCCI’s unique position amongst ICC
  members and create a sustainable leadership position.
  ENHANCING OVERALL REVENUE OF BCCI RIGHTS



 Creation of a valuable brand which can be
  leveraged for multiple streams of business and
  revenues
 Generate substantial stream of revenues as
  compared to trading of rights.
 Unlock the potential of realizing subscription
  revenues in addition to the sponsorship and
  airtime revenues.
 Unlock revenue opportunities in the areas of
  Merchandising, Events and Franchises etc.
      ENHANCING OVERALL REVENUE
      OF BCCI RIGHTS

 Unlock revenue opportunities in the overseas markets.
 Rope in cricket stars to endorse the channel.
 Establish a dynamic professional organization that
  can acquire a leadership position in the sports
  business.
 Effectively and significantly enhance & create
  shareholder value.
 To boost the growth of other sports in India by
  generating visibility for Indian sports persons and
  their particpn in International cricketing events not
  covered by other channels
  KEY SUCCESS FACTORS ?

 A professional and independent organization
  answerable to a designated board.
 Creation of sound production competencies.
 Airtime marketing skills.
                          [



 Pay distribution skills.
 International business development skills.
 Creation of skills for merchandising and event
  management.
  KEY THREATS & OPPORTUNITIES

Threats:

 International cricket rights
 Consent of Overseas Boards whether on a bidding basis or
  through mutual negotiations.

Opportunity :

 Fragmented Rights for cricket amongst existing sports channels
  in India.
 Buoyant capital markets. Appropriate time for IPO or listing.
 Make Indian public stake holder in the venture – good will.
 Sorts out the current legal issues in award of Rights.
   KEY ASSUMPTIONS
International Matches in India :
    Number of Test : 10 Total Days 50
    Number of ODI : 15 Total Days 15

International Matches outside India but involving India
    Number of Test : 4 Total Days 20
    Number of ODI : 7 Total Days 7

International Matches outside India without India
    Number of Test : 15 Total Days 75
    Number of ODI : 21 Total Days 21

Total Days of Domestic Cricket : 118 Days
     Domestic Cricket League :
     Total number of teams : 8
     Round robin league on home & away basis : 56
     Semifinals : 2
     Final : 1
Total number of Matches : 59
     KEY ASSUMPTIONS
Sharing of Rights with DD and AIR
 If required by law, TV Rights will be shared with DD for
   simulcast of all one day matches involving India.
 Test matches to be exclusive to BCCI Channel.
 All Highlights to be shared with DD.

Other alternatives
 Even if all international matches are simulcast both channels
   shall have separate productions as a differentiating factor.
 Value addition on BCCI channel through better commentators
   and lead in and wrap up programmes.
 Simulcast with DD but the entire Air Time inventory is
   marketed by BCCI channel and DD gets opportunity cost of
   DD Air Time.
     BCCI MATCHES

 BCCI should strive to maximize international cricket played in
  India as a policy.
 Provide for at least two Test Match cum one day series each
  year and a triangular one day international tournament in
  India (may be in the summer months)
 India to only play one away series each year.
 Provide for higher match fees for visiting Teams in India as
  an incentive to draw larger number of overseas teams.
 BCCI should negotiate as a precondition TV Rights for India
  market as part of the package of reciprocal visit of Indian
  Team to other countries.
     BCCI MATCHES

 BCCI to also negotiate for procuring overseas boards rights to
  archival TV footage.
 Encourage live production of all Domestic cricket as
  promotional effort.
 Promote a Domestic Cricket League :
          Total of 8 City Teams
          Round robin league on Home & away basis : 56
          Semifinals :2 matches
          Final : 1
          Total no. of Matches : 59
 Revenues from the overall business to be ploughed back to
  Associations, Sports persons and in upgrading cricketing
  infrastructures.
     BCCI MATCHES INT’L

 Subscription Revenues are a mix of DBS and Cable
  subscription platforms.

 No revenue from web casting or any other emerging media
  have been forecast.

 Advertising Revenues from Middle East, Africa, S. E. Asia,
  Australia/New Zealand not projected.

 No Revenues from Radio have been considered.

 Subscription revenues from Bangladesh, Nepal, Pakistan,
  Srilanka, Maldives not factored.
     BCCI MATCHES – Other assmpns.

 Revenues from Title and Team Sponsorship not factored
  though these are well established revenue sources.
 Revenues from Merchandising and Franchises not factored
  but these potential revenue streams will develop as the
  business evolves.
 Syndication Revenue stream has also not been factored
  though could develop healthily as the business evolves.
 Revenue from Events not factored also. This too can evolve
  and in addition can provide strong marketing, PR and
  programming value additions
 Revenues from web casting not factored.
 Revenues from DVD’s, Cricket academy video’s etc. not
  factored.
 Revenues from Radio in India not factored.
   PRODUCTION AND TECHNICAL

 The overall emphasis will be on outsourcing live productions
  to competent agencies.
 However, to minimize costs and facilitate logistics only fly
  away uplinks equipments and out door production vans have
  been provided as Capital Expenditure items.
 Core competence for in-house productions, graphics etc. will
  however be created.
 Therefore, a total capex of 40.00 crores as one time cost for
  Broadcast operations center, studios, shooting floor, on-line
  edit room, non-linear edit room and graphics room will be
  housed in a centrally air conditioned 5000 sq. ft. of space.
    PRODUCTION & TECHNICAL (contd.)

 Commentators will be outsourced on contract.
 For Live International Matches in India since BCCI will
  provide Fly Away uplinks and OB Vans we estimate paying
  at the rate of USD 50000 per day as production cost to an
  outsourced Agency such as TWI or World Tel or Channel
  Nine.
 For Domestic live Matches a second domestic agency will
  be outsourced for production at USD 30000 per day.
    PRODUCTION &TECHNICAL (contd.)

 All promos, fillers and interstitials to be produced at in-
  house facilities.
 All technical, creative and production personnel to be
  employed on yearly retainers.
 Event Mascots etc would be produced in house.
 Channel ID and supportings would be created at the in-
  house facilities.
 A core team of 38 would manage the entire operations.
    THE ORGANIZATION

   A flat organization with CEO reporting to a Board of Directors has
    been contemplated.
   Given the size and scale of operations contractual retainerships are
    contemplated for production and broadcast operations in non core
    areas.
   An in-house Airtime marketing and Distribution Team is being
    recommended.
   For overseas operations, personnel for effecting airtime sales and
    distribution are being proposed for the international markets.
   Payroll functions, PF and other statutory functions and even legal
    support can be outsourced.
   No provision for peons/drivers and class IV employees has been
    made.
   Accent will be on team building, transparency and multifunctionality
    skill based organization.
                                                                                    ORGANOGRAM
                                                                                                           CEO
                                                                                                                           SECRETARY
                                                                                                          COO
                                                                                                                           SECRETARY




                    MARKETING                      CORPORATE AFFAIRS &                     DISTRIBUTION                            PRODUCTION, TECHNICAL                  FINANCE &                GENERAL
Departments Personnel               Number       INTERNATIONAL OPERATIONS   Departments Offices           In Cities               & BROADCAST OPERATIONS                  ACCOUNTS          ADMINISTRATION
PR                                     2             Number of Personnel    HEAD                               1               Departments   Personnel    Number   Departments Number      Departments Number
                                                             4              DISTRIBUTION                                       PRODUCTION    HEAD              1     FINANCE &        1    HEAD-ADMN          1
BRAND           Director               1                                                                                                                             ACCOUNTS

                GM                     1                                    SMS                                4               TECHNICAL     HEAD              1                           ADMIN              3
                Brand Mgr              1                                                                                                                           COMPANY            1
                Supp Staff             3                                    TECHNICAL                          3               BROADCAST                           SECRETARY               LEGAL              3
TRAFFICKING                            5                                    ACCOUNTS                           7               OPERATIONS    HEAD              1   REGIONAL           10   HR                 4
AIRTIME SALES   Delhi             Gen Mgr -1+4                              SALES                     Delhi                    HEAD LIVE                      20   H.O.               10   TOTAL             11
                Mumbai                 4                                                    REGIONAL Mumbai                    INCLUDING

                Bangalore              3                                                    OFFICES   Bangalore                BROADCAST                           TOTAL              22
                Kolkata                3                                                              Kolkata                  OPERATIONS

                Support Staff +                                                                       Ahmedabad                HEAD STUDIO   Production        5
                Assistants             4                                                             Hyderabad
                                                                                            REPRESENTATION                     BASED         Assistants        5
                Secretary              4                                                    OFFICES   Kanpur                                 Support           5
RESEARCH &                             2                                                    ONLY      Ludhiana                 TOTAL                          38
ANALYSIS                                                                                              Jaipur
TOTAL                                 38                                                              Indore
                                                                            TOTAL                                     75



India           :                          198
Intern'l        :                           20

Note :          Detailed departmentwise organogram can be prepared in the detailed project report
    NECESSARY STEPS AND TIMELINES

   Decision by the BCCI in approving the concept.
   Constitution and registration of an appropriate vehicle whether Company/Board or any
    other body and the statutory approvals thereof.
    45 Days.
   Registration of logo, brand name and other trade marks in India and overseas
    markets.
    45 Days to 3 months.
   Approval of Ministry of Information and Broadcasting for the license of the channel and
    its registration.
    3 / 4 months.
   Funding the capex and equity in the proposed venture as per Board Decision.
   Setting up the organization and in hiring a suitable core team including the CEO.
    4 months.
   Launch to coincide with the forth coming tour of Sri Lanka to India in
    September/October.
   Enter into arrangements with DBS and cable platforms in UK/Europe, US/Canada,
    Middle East and Africa, Singapore, Malaysia, Hong Kong and Australia/New Zealand.
    From 4 months to 1 year.
   The launch of channels in these markets will be staggered accordingly.
    PROJECT EXECUTION

 Recommend a stage by stage approach.
 All International markets may not be served since inception
  and instead can be launched step by step.
               REVENUE

(All Figures in Rs. Million)                Year 1       Year 2    Year 3    Year 4    Year 5       Total
                                                                                                 In 5 Years
Revenue

Airtime                                          4,403     5,083     5,877     6,794     7,807      29,963
Airtime - India on DD feed                         -         -         -         -         -           -
Sale of Title sponsorship rights                   -         -         -         -         -           -
Sale of Title sponsorship rights Overseas          -         -         -         -         -           -
Radio- India and Overseas                          -         -         -         -         -           -
Emerging media                                     -         -         -         -         -           -
Syndication                                        -         -         -         -         -           -
Merchandise                                        -         -         -         -         -           -
Events                                             -         -         -         -         -           -
Board Partners                                     -         -         -         -         -           -
Franchise                                          -         -         -         -         -           -
Subscriber Revenue India                         6,000     7,920     9,583    11,596    14,031      49,130
Subscriber Revenue International                10,876    11,963    14,475    17,515    21,193      76,023
Revenue from DTH                                   221       613     1,386     2,793     4,788       9,801

Total Revenue                                   21,499    25,579    31,321    38,698    47,819    164,916
               COSTS

(All Figures in Rs. Million)               Year 1       Year 2    Year 3    Year 4    Year 5       Total
                                                                                                In 5 Years
Costs

Airtime Sales Commission                          660       762       881     1,019     1,171       4,494
Dealer Incentive sub revenue - India              300       396       383       406       491       1,976
Revenue shared with Platforms                   3,439     3,783     4,460     5,255     6,358      23,296
Cricket Rights                                  1,544     1,544     1,544     1,544     1,544       7,721
Salaries, Office and Administrative Cost          258       291       329       372       420       1,671
Production Cost                                   532       604       695       809       954       3,594
Transponder Cost                                   18        19        20        21        22          99
Backhaul cost india incoming                       25        29        33        38        44         169
Backhaul cost india outgoing                       75        86        99       114       131         506
Marketing Cost                                    250       275       316       380       474       1,695
 Total Costs                                    7,102     7,790     8,761     9,957    11,610      45,221
               PROFIT AND LOSS
(All Figures in Rs. Million)                          Year 1            Year 2       Year 3       Year 4         Year 5          Total
                                                                                                                              In 5 Years

Total Revenue                                              21,499        25,579       31,321         38,698       47,819       164,916

Total Costs                                                 7,102         7,790        8,761          9,957       11,610         45,221

EBITDA                                                     14,397        17,789       22,560         28,741       36,208       119,695

EBITDA %                                                           67           70           72             74           76

Depreciation                                                       39           48           56             64           72        279

EBIT                                                       14,358        17,741       22,504         28,677       36,136       119,416

Interest                                                       -            -            -              -            -              -

EBT                                                        14,358        17,741       22,504         28,677       36,136       119,416

Tax                                                         4,833         5,972        7,575          9,653       12,164         40,195

EAT                                                         9,525        11,769       14,929         19,024       23,973         79,220

Note :
*Sharing of International matches with DD but share of revenue not factored.
* Revenue from radio not factored.
* Title and team sponsorship revenues not factored.
* Revenues from syndication, events, merchandising etc have not been factored.
* In a 5 year time frame all these revenue streams can deliver enhanced revenue and profitability.

				
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posted:4/27/2013
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