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It’s an action-packed January in the world of sport! 

The 2023 Men’s FIH Hockey World Cup begins today in Odisha. From Monday, Novak Djokovic will look to win a 10th Australian Open title after being denied the opportunity last year because of his Covid vaccination status. And the 2023 badminton season is also in full swing, with the Malaysia Open Super 1000 reaching its conclusion this weekend, followed by the India Open Super 750 next week. 

Meanwhile, in the world of cricket, India are playing hosts to Sri Lanka and New Zealand for rather pointless limited-overs series that can be best described as warm-ups for the 2023 men’s ODI World Cup in October-November.

I’m not really following the cricket—i’m one of those cynical old farts who thinks there’s too much cricket on the television. But one thing did pique my interest when the India-Sri Lanka series began on January 3. The logo on the right upper chest of the Indian team’s jersey had changed. That spot is reserved for the official kit manufacturer. But there’s been radio silence from the Indian cricket board as to what’s going on. 

It was leg-spinner Yuzvendra Chahal who inadvertently broke the news about the Indian team’s new official kit partner. 

On January 2, a day before the Sri Lanka series began, the 32-year-old posted a photo on social media of himself and four teammates wearing the India kit. Eagled-eyed social media users noticed that the logo on the right upper chest had changed from MPL Sports, which was the official kit partner of the Indian team since November 2020, to Killer Jeans.

As social media and the traditional media began to speculate what had happened, you’d think the Board of Control for Cricket in India (BCCI) would soon issue a clarification before the series began. 

It never came.

Finally, Kewal Kiran Clothing Limited (KKCL), the company that owns the Killer Jeans brand, issued a press release around 11.30 am on January 6. That was after the Indian team had played two whole matches with a new kit partner.

The release said that the company had got into a strategic partnership with BCCI as the Indian cricket team’s “Official Sponsor”. It added that KKCL will don the Killer Jeans logo on Team India’s kit until May 31, 2023. Which means it’s only coming on board for five months. MPL Sports’ three-year contract with the BCCI was supposed to run until December 2023.

However, MPL Sports had reportedly written to the BCCI early last month saying it wanted to exit the contract, and had found a willing party to come onboard for the rest of the term. A Press Trust of India report last month quoted a “BCCI note” as saying: 

“BCCI received an email communication from MPL sports on 2.12.2022 seeking a complete assignment (team merchandising) at full value to Kewal Kiran Clothing Limited, a fashion wear brand, for the period from 1.12.2023 to 31.12.2023.

“With the upcoming back to back home series and the women’s away calendar, it was suggested that the current arrangement should not be hampered as it involves performance gear for the national teams.

“We have asked MPL sports to continue the association at least until 31.3.2023 or look for a partial assignment that would involve only the right chest logo but not the kit manufacturing agreement.”

It seems like MPL Sports didn’t want to continue even until March, and the “partial assignment” to KKCL has taken place. Which would imply that the Indian team is wearing jerseys manufactured by MPL Sports but with the Killer Jeans logo. At least until May 31. 🤷🏽‍♂️ In return, KKCL is covering the entire per-match fee that MPL Sports is supposed to pay BCCI—₹65 lakh (~$80,000). 

From January to May, the Indian men’s team is playing 19 matches, while the women will play at least eight (could be more depending on how far the team goes in the ICC Women’s T20 World Cup next month). Which means KKCL will pay a minimum of ₹17.5 crore ($2.1 million) for having its logo on the right upper chest of the jersey for five months.

Apart from the per-match fee, MPL Sports also has to pay an annual fee of ₹3 crore ($368,000) and royalty for every piece of merchandise it sells, which can be anywhere between 10-25%. It’s not clear whether KKCL is also compensating MPL Sports for the annual retainer. MPL Sports did not respond to my request to participate in this story, while KKCL declined to comment. 

As for the merchandise royalty, the MPL Sports website isn’t selling any jerseys with the Killer Jeans logo. It only has merchandise with its own logo. Killer Jeans, meanwhile, has only put up one piece of BCCI merchandise on its website so far—a jersey that has some resemblance to the India T20 jersey worn by the players but doesn’t look exactly the same. It has the Killer Jeans logo and is manufactured by KKCL. 

It’s unclear whether KKCL plans to launch any more India cricket merchandise, including the actual players’ jersey. But it appears that both companies will continue selling BCCI merchandise with their own logos, and pay separate royalties to the board. 

This whole episode raises two fundamental questions:

1. What happened to MPL Sports?

2. How is a brand that’s known for making jeans and casual wear now the BCCI’s official kit sponsor?

MPL Sports: A cautionary tale

In November 2020, the BCCI announced that MPL Sports, an athleisure wear and sports merchandise brand launched by mobile gaming platform Mobile Premier League (MPL), was the new kit sponsor and official merchandise partner for the Indian cricket team. The announcement came after sportswear major Nike decided against renewing its deal with the BCCI, which was worth ₹370 crore ($50 million) a year. Nike had been the BCCI’s official kit partner since 2006.

MPL coming onboard as the new kit partner was a surprise move by most counts, given that the company had no prior experience in making any kind of apparel, let alone sportswear. It had sponsored a couple of Indian Premier League teams, while the then-Indian cricket captain Virat Kohli was an investor and brand ambassador. But that was for its mobile gaming platform.

MPL’s entry, for most, seemed left-field in classic sporting terms, given that top brands such as Adidas, Puma, Wrogn, and the Walt Disney Company, which had apparel and merchandising experience, had picked up the tender documents but never actually submitted a bid to become the BCCI’s new kit partner. 

The BCCI had set a base price of ₹8 crore ($980,000) for the three-year rights cycle, along with a per-match fee of ₹65 lakh. That was lower than what Nike had paid over the previous four years—₹30 crore ($3.7 million) and a per-match fee of ₹85 lakh ($104,000). Even with the discount, none of the interested parties submitted a bid.

Eventually, MPL decided to come on board. “It was almost as if MPL came to BCCI’s rescue. The BCCI was literally scrambling when this deal happened, given that Nike was a constant for the past 14 years. It seemed like a stop-gap arrangement, despite the BCCI’s detailed criteria for a clothing sponsor,” says an industry expert aware of how MPL Sports came into the fray. 

MPL didn’t initially fulfil almost every single criterion laid out by the board as part of the tender documents, since it didn’t have any apparel-making experience. To become eligible, it set up a company in Bengaluru called Nereus Sports Products Limited, which was exclusively dedicated to manufacturing and selling Indian cricket team jerseys and merchandise. It decided to call the new brand MPL Sports.

Why was MPL getting into sports merchandising? The internal thesis was simple: as a company with a growing online gaming/e-sports/fantasy sports business, it wanted to use the biggest real estate in Indian sport—the Indian cricket jersey—as a so-called flywheel for its core business. It hoped that the BCCI partnership would not just turbocharge activity on its fantasy offerings, but also compel the die-hards to spend more money on a replica jersey. 

“That most of these gaming brands were coalescing around cricket at the time wasn’t surprising either. Dream11 had just sponsored the IPL. MPL had to do something, and they went this way,” says another person aware of the matter.

With the BCCI contract sorted, next up for MPL was the actual manufacturing of jerseys. How did a company with no prior experience in apparel-making manage this? Two words: contract manufacturing.

Most apparel brands have a contract manufacturing setup, wherein they outsource the manufacturing to third-party vendors. “All they had to do is find the specialised vendors for sports apparel,” says an official from the apparel industry. 

“In today’s day and age, all manufacturer details of a product are available on the wash-care label and on e-commerce websites. There is a robust manufacturing ecosystem in India, Sri Lanka, Bangladesh, and Southeast Asia. All you have to do is find the right partner to make the jersey for you, put your branding on it, and sell it.” 

While established sportswear brands like Nike, Adidas, and Puma have their own proprietary technology that they use in their apparel, the actual manufacturing happens in a factory. The vendors would thereby have knowledge of this technology and could apply it to any other client’s products provided they make a certain number of tweaks for legal purposes. 

As a result, a vendor can technically create a jersey for MPL Sports or any other brand that has a 75-80% resemblance to a Nike jersey in terms of the quality. “It’s like: if you’re a data analyst, you can’t use your client’s data anywhere else. But the analytical skills that you imbibe can be used anywhere,” says the second industry expert. 

As MPL Sports launched its Indian cricket merchandise ahead of India’s tour of Australia in late 2020, it did rather well to generate a buzz. Its first India jersey was a throwback to India’s 1992 World Cup kit, which invoked nostalgia. “The retro jersey was a design success at the time, at least internally,” says a person aware of developments within MPL at the time.

Another aspect that MPL Sports got right was the pricing. Its “Fan Edition” jersey, which looked almost identical to the one worn by the players, started from ₹1,600 (US$20). Nike’s India jerseys used to retail for around ₹5,000 ($60). MPL Sports also sold a more premium “Player Edition” jersey that retailed for ₹3,500 (US$43), along with a cheaper “Stadium Jersey” for ₹900-1,000 ($11-12), which was a round-neck jersey with the same colouring as the official kit. In terms of variety, MPL Sports did far better than its predecessor.

However, despite the initial buzz, MPL Sports failed to really connect with Indian cricket fans. “Ultimately, people are buying an India jersey. Except, this time, they had no clue about the sponsor,” says the person quoted above. Nike is associated with sports apparel, so there is a connect with the consumer if they make the Indian jersey. With MPL, that was missing. 

What was also missing was an offline presence, especially around cricket stadiums in India. “Around 60% of jerseys are purchased right outside the stadium before matches, and none of the BCCI’s kit partners have had a presence there. It all goes back to the Indian mindset that is still trying to adapt to buying an authentic jersey rather than a cheap first copy that you get outside stadiums for ₹200-300 ($2.5-3.5),” says another official who has worked in the sports apparel industry.

While it isn’t clear how many jerseys MPL Sports has sold over the last two years, parent Nereus Sports Products earned a revenue of ₹11 crore ($1.3 million) in the year ended March 2022, at an expenditure of nearly ₹27 crore ($3.3 million). MPL, meanwhile, reported a 3X surge in losses to $149.3 million in the same year. It earned $63.8 million through online gaming, up from $50.8 million in the year ended March 2021.

That’s how MPL’s two-and-a-half-year love affair with the BCCI ended in a whimper, particularly with macroeconomic headwinds at play and investors keen to invoke fiscal discipline among their portfolio. All of which now begs the question: in a challenging year for most businesses, who is likely to bite and pay top dollar for the India jersey? 

The answer is unclear, but the Killer Jeans deal may offer a hint or two. “The BCCI will likely make the terms more palatable to attract some of the biggest names in sports business,” says the first industry expert. “The Killer Jeans deal seems like another stop-gap. After all, it’s better to have someone on board rather than no sponsor at all, considering this is a key revenue stream for the board.” 

So that’s how and why a jeans brand is temporarily sponsoring the Indian cricket team. For KKCL, a profitable listed company, five months is a good time period to get a sense check of how fruitful a BCCI sponsorship is. In the off chance that the BCCI fails to find a new kit partner post May, and if Killer Jeans is willing to extend the deal, it won’t be too difficult for a casual-wear brand to make Indian cricket merchandise. Whether it’s a sustainable business, though, is a completely different story.

– With inputs from Venkat Ananth

⚡️Quick Singles

🏏📺🇮🇳 Viacom18 is deliberating multiple pricing strategies for its maiden Indian Premier League (IPL) digital broadcast, including a free viewing option on streaming app JioCinema, according to a report in The Hindu businessline. The broadcaster is likely to bundle free IPL streaming with Jio telecom subscription packages or allow users of rival telcos to access some form of free broadcast on JioCinema. Viacom18 will continue to offer subscriptions for a superior match-viewing experience, the report said.

🏏📺🇮🇳 Disney-Star, Viacom18, Sony-Zee, Amazon, FanCode, and Times Internet are among the companies that have reportedly picked up bid documents for the media rights auction of the women’s Indian Premier League for the 2023-27 cycle. They’re expected to submit bids on January 16. The BCCI is reportedly looking to make ₹1,100 crore-₹1,250 crore ($135 million-$150 million) from the auction, which is about ₹220 crore-₹250 crore ($27 million-$30 million) annually.

🏈🤑 The United States’ National Football League (NFL) made a record $2.7 billion in sponsorship revenue in the 2022-23 season, led by deals in alcohol and tech, according to market research firm SponsorUnited. The league recently signed a deal with YouTube for the NFL Sunday Ticket package of games for a reported $2.5 billion per year. It also earns about $10 billion annually from media rights deals with Comcast, Disney, Paramount, Fox, and Amazon.

🏎️🎰🇺🇸 Formula One is looking to make $500 million in revenue from the Las Vegas Grand Prix in November this year. The sport is returning Sin City for the first time since 1982. Tickets for the night race will cost a minimum of $500 for three days, while the ultra high-end package for five days will burn a $15,000 hole in your pocket. The first batch of tickets were sold out in 45 minutes. 

🎾🇯🇵 Naomi Osaka, the world’s highest-paid female athlete, has announced she’s pregnant and will miss the entire 2023 tennis season. The 25-year-old  recently withdrew from the Australian Open, which she has won twice. She hasn’t played a full match since her first-round loss at the 2022 US Open and participated in just 11 tournaments last year. Osaka started her own talent agency in 2022 along with her longtime agent Stuart Duguid. 

That’s all for this edition of The Playbook. Please reach out to me at jaideep@thesignal.co with any feedback (good, bad, or ugly), tips, and ideas. 

See you again next Friday!

Best,
Jaideep Vaidya

Welcome to The Playbook, a weekly newsletter on the business of sports and gaming. If someone shared this newsletter with you, please hit the subscribe button below — it’s free!

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How has the first week of the new year gone for you? I hope your 2023 resolutions are on track! As for me, I’ve not even had the time to think about new-year resolutions because I’ve spent the last few days moving from Bangalore to Pondicherry. Yes, yes, I know, such a cool place to move to, etc etc, but I’m hoping it’s worth it considering the ordeal my partner and I went through with our movers and packers. Long story for another day.

I’ll keep this edition short because I’ve honestly not had the time to keep up with the news cycle this past week. So, I thought I’ll write about the one story that I did follow—one that made me cackle loud enough to scare my cats.

The Big Take

In The Playbook’s year-ender a couple of weeks ago, I called 2022 the year of sportswashing. So it was rather apt that the year ended with yet another instance of a government using sports sponsorship to improve its global reputation. Yet again, it was Saudi Arabia.

Late on December 30, Saudi Arabian football club Al-Nassr confirmed reports that it had signed Portuguese superstar Cristiano Ronaldo. The 37-year-old has reportedly signed a two-and-a-half-year contract, which will likely see him end his career playing in the Saudi Pro League. “I am excited to try a new football league in a different country,” Ronaldo said in a statement released by the club. “The vision that Al-Nassr is working with is very inspiring.”

Then, on January 3, Al-Nassr officially unveiled Ronaldo. “In Europe, my work is done. I won everything, played for the biggest clubs. Now, I have a new challenge,” he said at a press conference where he only faced questions from a club representative. When asked what he was hoping to achieve on and off the pitch in Saudi Arabia, here’s what he said: 

“This is a great opportunity not only in football but also to change the mentality of the new generation. I had many opportunities in Europe, Brazil, Australia, the US, and even [back home] in Portugal. Many clubs tried to sign me, but I gave my word to Al-Nassr to get the opportunity to develop not only football, but other parts of this amazing country. 

It’s a chance to help grow, with my knowledge and experience, many important aspects, including women’s football. I want to give a different vision of this country, of its football. This is why I took this opportunity.”

It was a public relations masterclass, with perfectly-choreographed questions and responses. Ronaldo also tried to convince everyone that Saudi Arabian football is competitive, giving the example of the national team beating eventual champions Argentina in the recently-concluded Fifa World Cup. “Everyone talks and gives their opinions, but they don’t know anything about football,” was his message to detractors. 

But by the end of the interaction, it became clear that the only person Ronaldo was trying to convince was himself. And for all the talk about helping grow women’s football and changing the image of Saudi Arabia, let’s cut the crap: one of the major reasons he’s gone there is because of the 💰💰💰. According to reports, Ronaldo will earn ~$200 million per season, making him the highest-paid footballer in the world. Around $75 million is for playing football, and the rest is for image rights and commercial deals.

Whatever Ronaldo’s motives are, make no mistake about what Saudi Arabia wants to achieve by signing one of the most famous people on the planet, with 529 million Instagram followers. (I say Saudi Arabia and not Al-Nassr because major football clubs in the country are ultimately owned by the state. Al-Nassr is sponsored by Qiddiya, a sports and entertainment company launched by Saudi Arabia’s sovereign wealth fund in 2018).

Reports have said that Ronaldo’s contract includes a clause that he will also be involved with Saudi Arabia’s bid to co-host the 2030 World Cup along with Greece and Egypt. Incredible, if true, considering Portugal also wants to host the tournament. And Ronaldo’s signing means that Saudi Arabia has two of the greatest footballers of all time on its payroll. Last year, the oil-rich Gulf nation roped in Lionel Messi to become its tourism ambassador. The contract is reportedly worth ~$30 million per year. 

Saudi Arabia is reportedly ready to spend $40 billion to fund the World Cup bid, which would probably see matches held in the winter again, like Qatar 2022. The bid is a part of Crown Prince Mohammed bin Salman’s ambitious Vision 2030—a transformative economic and social reform blueprint to reduce Saudi Arabia’s dependence on oil and diversify its economy. 

Ronaldo is also the latest piece in Saudi’s plan to sportswash its abysmal human rights record. The country has spent at least $1.5 billion on high-profile international sporting events, according to a 2021 report by human rights organisation Grant Liberty. The sports include football, golf, tennis, Formula One, chess, boxing, and horse racing. 

Human rights group Amnesty has urged Ronaldo to speak out over human rights issues in Saudi Arabia. If only pigs could fly.

⚡️Quick Singles

⚽️🔵⚪️ Manchester City has announced a new partnership with Jio Platforms that will see Reliance Industries’ digital services subsidiary become the club’s official mobile communications network partner in India. City fans in India will be able to access club content through Jio’s digital ecosystem, including JioTV and other apps. In June 2020, the UAE’s sovereign wealth fund, Mubadala, had invested $1.2 billion in Jio Platforms in exchange for a 1.85% stake. Manchester City is indirectly owned by the Abu Dhabi royal family.

🏏🇮🇳👖 Killer Jeans has replaced MPL Sports as the official kit sponsor of the Indian cricket team. MPL had a contract with the Indian cricket board (BCCI) until December 31, 2023, but the mobile gaming company decided to pull out early. There has been no official announcement on this from the BCCI. 

🎮💰 GMR Sports, a subsidiary of Indian conglomerate GMR Group, is reportedly in talks to buy “a significant stake” in fantasy gaming startup Fantasy Akhada at a valuation of $160 million-$175 million. GMR Sports co-owns the Indian Premier League franchise Delhi Capitals, among others.

📺🏈 Amazon has discussed building a standalone streaming app for sports, according to The Information. The tech giant owns the streaming rights for sports properties such as the NFL’s Thursday Night Football, some Premier League matches in the UK, New Zealand Cricket in India, and the New York Yankees baseball games in the New York region. It also recently made a big push into sports talk shows. 

🏏📺🇦🇺 Cricket Australia has signed a ~$ 1 billion extension of its domestic broadcast rights partnership with pay-TV network Foxtel and free-to-air broadcaster Seven. The new deal is for seven years starting from mid-2024. It covers bilateral men’s and women’s cricket series played in Australia, as well as the men’s and women’s Big Bash Twenty20 leagues. The current six-year deal is worth $794 million.

That’s all for this week. Please reach out to me at jaideep@thesignal.co with any feedback (good, bad, or ugly), tips, and ideas. 

See you again next Friday with a full edition!

Best,
Jaideep Vaidya

Welcome to The Playbook, a weekly newsletter on the business of sports and gaming. A warm welcome to new subscribers who joined this week. If someone shared this newsletter with you, please hit the subscribe button below — it’s free!

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This is the final edition of 2022, as The Playbook will be taking a break for the year-end holidays next week. The next edition will land in your inbox on Friday, January 6. Here’s wishing all you lovely people a Merry Christmas and a Happy New Year! 🎄🎆

As we bid farewell to 2022, I thought it would be apt to recap the biggest events from the year that shaped the world of sports. If there had to be one overarching theme, 2022 was the year of sportswashing—a year bookended by the Beijing Winter Olympics and the Fifa World Cup in Qatar, where authoritarian regimes tried to distract the world from their abysmal human rights records by hosting global sporting events.

But that wasn’t all. 2022 was quite an eventful year. Here’s a look at the major shifts in the world of sport this year:

Beijing 2022: the most political Olympics in years

In February, China became the first country to host the summer and winter Olympics in the same city—its capital, Beijing. It was an accomplishment that the Chinese Communist Party tried to project as a mark of its supremacy. However, the 2022 Winter Olympics never quite managed to rise above numerous controversies, including the Chinese government’s inhumane treatment of ethnic minorities in the Xinjiang region, its attempts to seize control of Hong Kong and Taiwan, and the disappearance (and state-controlled reappearance) of tennis player Peng Shuai after she accused a former government official of sexual assault.

Several western countries announced a diplomatic boycott of the Games, although they allowed their athletes to compete. China called the boycott “a farce” and said the Olympics were not about politics. However, the Xi Jinping regime followed that up by inviting Russian president Vladimir Putin to the Beijing 2022 opening ceremony and supporting Moscow in its dispute with Ukraine, which was threatening to break out into an armed conflict.

Four days after the curtains fell on Beijing 2022, Putin announced a “special military operation” against Ukraine. More than 300 days later, the war continues.

The world of sport unites against Russia

Days after the invasion of Ukraine, numerous international sports bodies banned Russia and its athletes from competing. This included sports such as tennis, football, Formula One, ice hockey, and figure skating. Even the International Olympic Committee (IOC), known to shy away from anything even remotely political, took action.

Russia lost the hosting rights to major events such as the 2022 men’s Champions League final and the 2023 world ice hockey championships. Russian and Belarusian players were also banned from the 2022 Wimbledon championships, under pressure from the British government. 

The sale of Chelsea FC

The United Kingdom also began targeting wealthy Russians with extensive business interests in the country because of their alleged links with Putin. This included Roman Abramovich, the oligarch owner of Chelsea Football Club. In early March, Abramovich, whose deep pockets had transformed Chelsea into a global powerhouse, announced that he was selling the club.

About a week later, the British government imposed sanctions on Abramovich, which effectively barred him from making any money in the UK, including selling Chelsea. The government took control of the club and allowed it to continue football-related activities, but it was barred from buying players and selling tickets. The government also accelerated the sale process, inviting bids from anyone interested in buying the club.

Two months later, in early May, Chelsea was sold to a consortium led by American billionaire Todd Boehly and backed by California-based investment firm Clearlake Capital. The winning bid of £2.5 billion ($3.1 billion) was the highest amount ever paid for any sports team at the time. 

And this piqued the interest of some of Chelsea’s peers.

The owners of sports teams smell an opportunity

The sale of Chelsea was the latest sign of American investors’ growing interest in football clubs, especially in the Premier League, with an eye on attractive returns. Joe Ravitch, co-founder of Raine Group, the merchant bank that conducted the Chelsea auction, had told the Financial Times in April that top Premier League clubs would probably be valued at more than $10 billion each in five years. ​​Last year, broadcaster NBC Sports paid $2.7 billion to extend its broadcast rights deal for the Premier League in the United States by six years. This was more than double the previous amount. 

In November, the American owners of Liverpool and Manchester United indicated that they’re open to strategic investments and even an outright sale at the right price. They’ve reportedly been advised that now’s the best time to sell, with valuations at their peak. 

The activity isn’t restricted to the Premier League. In August, American investment firm RedBird Capital bought Italian champions AC Milan for $1.2 billion. Their rivals Inter Milan are also in the market for a buyer, while the Qatari owners of French champions Paris Saint-Germain are looking to sell a minority stake at a valuation of over €4 billion ($4.25 billion). 

In a previous edition of The Playbook, I’ve already written about why football club owners are looking to cash out. But the activity isn’t restricted to football clubs. 

In June, a consortium led by Walmart heir Rob Walton bought the National Football League (NFL) franchise Denver Broncos for $4.6 billion—beating the Chelsea record. And just earlier this week, American billionaire Mat Ishbia agreed a deal to acquire the Phoenix Suns and Phoenix Mercury basketball teams at a valuation of $4 billion—a record in the National Basketball Association (NBA). 

If you’re a billionaire and want to own a sports team, now’s your chance. I’m sure we’ll see a lot more deals in 2023.

A major shake-up in India’s sports broadcast space

In June, the Indian Premier League (IPL) held its media rights auction for the 2023-27 cycle. The auction lasted three days and generated a record ₹48,390.3 crore ($6.2 billion) for the Board of Control for Cricket in India (BCCI)—nearly three times the amount that won the last auction in 2017. And unlike the previous two auctions, one broadcaster didn’t win all the rights.

The Walt Disney Company retained the television rights for ₹23,575 crore ($3.02 billion) but lost the digital rights to Viacom18, which paid ₹23,757.5 crore (US$3.04 billion). This is just for the Indian subcontinent. If you include the figures for other regions, an IPL match is now worth over $15 million. Only the NFL gets paid more—$35 million.

The IPL media rights auction kickstarted a slugfest in the Indian sports broadcasting industry. I’ve written about how Disney fought back by overpaying for the International Cricket Council (ICC) and Cricket Australia rights. Viacom18 then went ahead and bagged multi-year deals for Cricket South Africa for its international matches and its new franchise-based league, SA20, which begins in January. And just earlier this week, it also won the rights to broadcast the 2024 Paris Olympics in India, paying $31 million or 3x the amount Sony Sports did for Tokyo 2020.

But the move that raised the most eyebrows was Viacom18 offering the 2022 Fifa World Cup for free on its streaming platform JioCinema. While media companies worldwide lost billions of dollars in market value this year due to the global economic downturn, Viacom18, a subsidiary of India’s largest conglomerate Reliance Industries, doubled down. It did face major teething issues while broadcasting the Fifa World Cup, but emerged from the month-long tournament with 100 million viewers and over ₹300 crore ($36 million) in advertising revenue. 

With a market cap of over $200 billion, expect Reliance Industries and Viacom18 to make some more noise on the sports broadcast front in 2023. Let’s just hope some of that money goes into its sports streaming technology, too. The 2023 IPL will be its biggest test, although the SA20 next month should give a good idea of what we can expect wrt cricket.

Saudi Arabia disrupts golf

Until June this year, Saudi Arabia had only invested in various sports, including football (it bought Premier League club Newcastle United last year) and Formula One. Then, it decided to control one. 

This summer, Saudi Arabia signed up a handful of the most popular golfers to participate in a new, glitzy, global tour called LIV Golf. It was billed as “an opportunity to reinvigorate golf” with star players (lured with fat paychecks) and a new format with shorter tournaments, some of which were played at former US President Donald Trump’s country clubs. 

LIV Golf was pitched as an alternative to the PGA Tour, the highest level of professional golf for nearly 100 years. The PGA Tour responded by suspending several players who had signed up with LIV Golf. The two series have since engaged in an acrimonious legal battle. 

Meanwhile, a recent report in The New York Times revealed that LIV Golf appears far from meeting the goals it had set out to achieve. Its inaugural season cost more than $750 million, and the league hasn’t yet announced any major broadcasting or sponsorship deals for the next season. Earlier this week, LIV Golf CEO Atul Khosla resigned from his position.

The birth of LIV Golf further stoked allegations of sportswashing against Saudi Arabia. Critics said it was the latest example of Crown Prince Mohammed bin Salman’s regime trying to sanitise its human-rights image, which hit a low after the 2018 assassination of journalist Jamal Khashoggi at the Saudi consulate in Istanbul.

Crypto winter freezes sports sponsorships

It’s amazing what a difference 12 months can make. Last year, one of the biggest shifts in sports business was the proliferation of cryptocurrency sponsorships. Crypto companies, which profited from the rising value of bitcoin and other digital currencies, turned to sports sponsorship to boost their growth. The logos of companies like Crypto.com, FTX, and Socios were seen everywhere in the world of sport.

We’re living in a completely different world today. The crypto bubble burst in 2022—and how! The industry has shed more than $2 trillion in market value in the last 12 months. The most significant collapse was that of crypto exchange FTX, which filed for bankruptcy last month and whose owner, Sam Bankman-Fried, has been arrested.

FTX reportedly spent close to $100 million on sports sponsorships in 2021. It had partnerships with the Mercedes F1 team, the ICC, and multiple franchises in the NBA, including the naming rights of the Miami Heat arena. It also had deals with ​​top athletes, including Tom Brady, Naomi Osaka, and Steph Curry. All these partnerships have been suspended. 

It’s not just FTX. There have been other breakups, like Chelsea-Amber Group, Red Bull Racing-Tezos, and Uefa Champions League-Crypto.com. Bloomberg reported that the number of crypto-sports sponsorship deals signed since July is down more than 50% compared with the first half of 2022. 

It’s not all over, though. 

Crypto firms still spent $2.4 billion on sports sponsorships this year, per Forbes. Crypto.com was a prominent sponsor during the Fifa World Cup in Qatar. Its $700 million naming-rights deal for the Crypto.com Arena in Los Angeles, home to the LA Lakers, is still alive. As is its $100 million deal with F1. Crypto exchange Binance has also ramped up its marketing after the FTX collapse, including launching an NFT collection with football superstar Cristiano Ronaldo last month.

What will happen in 2023? Your guess is as good as mine.

A World Cup like no other

And then, to wrap up the year, there was Qatar 2022. 

Arguably the most controversial and chaotic Fifa World Cup in its 92-year history. Corruption allegations, migrant worker rights, rainbow armbands, a last-minute beer ban, and an extraordinary speech on morals from Fifa president Gianni Infantino… the World Cup had everything.

What it also had was some exhilarating football. The script could not have been better: big upsets, plenty of underdog stories (including the Moroccan miracle), four thrilling quarterfinals, and arguably the best World Cup final of all time, culminating with Lionel Messi lifting the only trophy that had eluded him in his glittering career. 

In many ways, Qatar got exactly what it wanted. And so did Fifa, which laughed its way to the bank with a record revenue of $7.5 billion for the four-year cycle leading up to Qatar 2022.

The months and years to come will define Qatar 2022’s legacy. Will it be remembered as the World Cup of Messi, Mbappe, and Morocco or a $300 billion, 12-year exercise in sportswashing? Will the world, including the media, eventually forget the plight of the hundreds of thousands of migrant workers, many of whom lost their lives while building the infrastructure for the tournament?

It’s really up to us.

That’s all for this edition of The Playbook. Please write to me at jaideep@thesignal.co with any feedback (good, bad, or ugly), tips, and ideas. 

See you next year!

Best,
Jaideep Vaidya

Welcome to The Playbook, a weekly newsletter on the business of sports and gaming. A warm welcome to new subscribers who joined this week. If someone shared this newsletter with you, please hit the subscribe button below — it’s free!

Subscribe now

If you were hoping an underdog wins the Fifa World Cup, tough luck. Footballing powerhouses Argentina and France sent the neutrals’ favourites Croatia and Morocco packing in the semifinals to set up a title showdown on Sunday.

However, a Lionel Messi vs Kylian Mbappe final is by no means a letdown. 

A 35-year-old footballing god who has won everything possible in a glittering, two-decade-long career except a World Cup versus a 23-year-old generational talent who’s looking to hoist the famous golden trophy for, incredibly, the second time. Both players will enter the final with five goals each in Qatar 2022, leading the Golden Boot tally.

But it’s not just about Messi vs Mbappe.  

Argentina are looking to win their first World Cup since 1986, while France are hoping to become the first team to defend the title since Pele’s Brazil did it in 1962. Both countries have won the World Cup twice, which means the winner will be behind only Brazil (five), Italy and Germany (four each). Argentina might even have a bit of revenge on their minds, considering France knocked them out in the round of 16 four years ago en route to the title. 

Honestly, I can’t believe it’s all ending this Sunday. No matter who wins the title, this World Cup has been unique in so many ways. I’m going to miss all the drama, if not the controversies.

Netflix, meanwhile, will soon be serving us with some tennis to make up for the void. Only, it won’t be live.

The big take

On Wednesday, Netflix released the teaser for Break Point, its new documentary series on tennis that’s releasing on January 13, three days before the start of the 2023 Australian Open.

Break Point, according to its description, “follows a diverse group of tennis players on and off the court as they compete in gruelling slams with hopes of winning a final and even bigger dreams of becoming world number one. Break Point gets up close and personal with top players on the tennis circuit through an entire year travelling across the globe for all four Grand Slams and the ATP and WTA tours.”

If you’ve watched Netflix’s acclaimed behind-the-scenes docu-series on Formula One, called Drive to Survive, I’m sure this rings a bell. Break Point, in fact, is produced by the same company, Box to Box Films, that made Drive to Survive. And that’s no coincidence, since the show is widely credited with helping grow interest in F1, a largely European and elite sport, around the world. The fourth season of Drive to Survive, released in March, made it to Netflix’s top-10 list in more than 50 countries. The series has been renewed for two more seasons.

Nowhere has the Drive to Survive effect been as prominent as the United States. Back in March 2019, when the first season was released, F1 used to get about 500,000 viewers per race in the country—a pittance compared with NASCAR (four million) and the Indy 500 (more than five million). The US used to host one F1 grand prix back then, but interest was dwindling. 

Nearly four years on, things are completely different. ESPN’s ratings have gone through the roof—the sports network broke the record for the largest American television audience for a live F1 race, with an average of 2.6 million viewers watching the Miami Grand Prix on its channel ABC, according to Forbes. ESPN’s average audience per race this year was around 1.2 million, up from 949,000 in 2021. 

More than 243,000 fans attended the Miami Grand Prix in July. And the United States Grand Prix in Austin, Texas, in October become the best attended race in its history, with 440,000 fans coming through the gates across four days at the Circuit of The Americas. The 2023 F1 season will have as many as three grands prix in the US, with Las Vegas joining the circus. And get this: the value of F1 broadcast rights in the US have gone up from $5 million per year in 2018 to $85 million, according to Sportico. 

So, what’s so great about Drive to Survive? If you ask me personally, I love the fact that it shines a light on the drivers, officials, and teams that don’t usually get much airtime during the live coverage. Like Guenther Steiner, the team principal of Haas, which has failed to finish above eighth in the constructors championship for the last four seasons. 

An extremely animated character with a habit of dropping F-bombs, Steiner stole the show in the first Drive to Survive season and became an instant fan favourite. In fact, the Italian has become such a cult figure in the last four years that he’s coming out with a book called…wait for it…Surviving to Drive.

One of the reasons Box to Box Films had to focus on the rest of the pack in F1 was because two heavyweights, Mercedes and Ferrari, chose to sit out of the first season. They thought that having a documentary crew follow them around with cameras throughout the season would be a distraction in the championship fight. After the phenomenal success of the first season, though, both teams reversed their decision.

That’s why I’m not too concerned about this:

If Break Point is anything like Drive to Survive, it won’t need a Roger Federer or Serena Williams to carry it. In fact, I’d happily watch a documentary solely focused on Nick Kyrgios, who will be a major part of the first Break Point season.

However, I do hope that Netflix and Box to Box Films rein in some of the creative liberties that they’ve taken with Drive to Survive. The series has been criticised for manufacturing certain storylines and exaggerating rivalries. Two-time F1 champion Max Verstappen refused to be interviewed for the 2021 season of Drive to Survive because of this very reason. 

Over the course of the four seasons, too, audio clips and reaction shots have occasionally been used misleadingly to help create a heightened narrative. In a Season 3 episode entitled “Man on Fire,” Hamilton was shown responding to a competitor’s near-fatal crash by saying, “It’s a little scary, makes you feel vulnerable.” It turned out that he was actually referring to catching Covid-19. Recently, Stefano Domenicali, the sport’s chief executive, suggested that the show should reduce its efforts to amp up conflict. “In order to ignite the interest of a new audience, a tone was used in some ways focused on dramatizing the story,” he said. “It’s an opportunity, but I think it needs to be understood.”

‘Drive to Survive’ Made Americans Fall in Love With Formula 1 | The New York Times

It’ll be interesting to see how similar or different Break Point is compared with Drive to Survive. Executive producer James Gay-Rees told the Associated Press that the aim would be to keep the core audience—the tennis enthusiasts—happy but also at the same time “appeal to people who’ve got no interest in tennis at all”. He added that the characters and the way a tennis season is structured give “an entirely different feel” to Break Point. The show will showcase “the physicality, the mental side, the rivalries, the pain” seen in tennis.

What’s interesting is how Netflix is making the behind-the-scenes sports documentary series its forte. The streaming giant is also creating similar shows around the Tour de France (cycling) and the PGA Tour (golf). But unlike its competitors such as Amazon, Apple, and Disney, Netflix has so far avoided dipping its toes in the live sports pool. 

Netflix co-CEO Ted Sarandos recently characterised live sports as “dramatically expensive” and a “loss leader” at an event. “We’re not anti-sports, we’re just pro-profit,” he said, adding that he believes Netflix “can get twice as big without [live] sports”.

If Netflix delivers another hit with Break Point, it’ll be well on its way to proving this point. 

⚡️Quick Singles

🏏💰 Indian cricketer Shikhar Dhawan has announced that he’s launching a new $75 million sports tech fund, called Da One Global Ventures. It will cover areas such as sports technology, esports, gaming, and web3. The firm will also incubate a sports-tech accelerator and an esports venture studio, according to a press release. Dhawan is the second Indian cricketer to launch such a fund, after Yuvraj Singh’s YouWeCan Ventures. 

🏈🏏🌎 The global value of sports media rights currently stands at $55 billion, according to SportBusiness’ recently published Global Media Report. The value will stay more or less flat next year but will go past $60 billion in 2024 thanks to new, high-profile deals in the National Football League (NFL), the Indian Premier League (IPL), and the Paris 2024 Olympics.

📱🏏🎥 Viacom18 could bring its various digital streaming platforms under one super app, according to The Economic Times. This includes apps like JioCinema, which is showing the Fifa World Cup, and Voot, which currently has all its other sports properties.

🇺🇸🔴⚫️ American businessman Bill Foley’s company Black Knight Football Club has bought Bournemouth Football Club, in a deal reportedly worth more than £100 million ($122 million). Hollywood actor Michael B. Jordan will be a minority shareholder. Foley owns American ice hockey team Vegas Golden Knights. More than half of the Premier League clubs now have majority of minority American shareholders. 

🏊🤽 The Fédération Internationale de Natation (FINA)—the International Swimming Federation in English—is rebranding itself as World Aquatics, ahead of the Paris 2024 Olympics. World Aquatics says the new brand is more inclusive of events such as diving, water polo, and artistic swimming, which it also governs. The rebranding follows similar decisions in recent years by the International Association of Athletics Federations (IAAF), which became World Athletics; the Fédération Internationale des Sociétés d’Aviron, which became World Rowing; and the International Rugby Board, which became World Rugby.

🎾🇦🇺 Sony Pictures Networks India has renewed its broadcast rights deal with Tennis Australia for the Australian Open for another three years. The new deal is worth $5 million-$6 million, according to The Economic Times. Sony Sports has been the official broadcaster of the Australian Open in the Indian subcontinent for nine years. The company said the 2022 Australian Open garnered nearly 23 million viewers.

⚽️🇮🇳 The All India Football Federation (AIFF) is reportedly planning a complete revamp of its work culture and formulating a 25-year roadmap that aims to make the national team one of the best in Asia. The roadmap will not explicitly state that India should qualify for the Fifa World Cup in another X years. “The new set of office bearers does not want to portray World Cup qualification as be-all and end-all goal. The thought process is if you are among the best in Asia, then you will be playing in the World Cup,” a source privy to the developments told PTI.

🎮 Amazon’s fledgling gaming division has teamed up with Lara Croft. The tech giant has announced a new deal with game developer Crystal Dynamics to publish the next Tomb Raider game, which will be “a single-player, narrative-driven adventure that continues Lara Croft’s story”. Crystal Dynamics will handle development, with Amazon “providing full support and publishing the game globally.”

📖 Weekend Reads

🤼🇮🇳 Did you know that kabaddi has a weight limit? And that players have to take drastic measures, like reducing their food intake and even avoiding water, to drop weight and make the cut-off? “At nights, I switch off the air conditioning, wear a thick sweatshirt and sleep under a heavy blanket to try and sweat it out,” Surender Gill, a 6’2” Indian raider told Scroll.in. Check out Shahid Judge’s piece here.

⚽️🇶🇦 Qatari broadcaster beIN Sports has devoted six channels to the Fifa World Cup, including two that are Arabic only. It has hired a host of retired players as pundits, such as John Terry, Peter Scmeichel, Kaka, and Ruud Gullit. It has also hired a bunch of interpreters who have to translate every word of Arabic into English in the ears of the pundits before flicking a switch in their minds and immediately rendering their reactions, delivered in English, back into Arabic. The toughest assignments go to one man. Check out Tariq Panja’s profile of Lassaad Tounakti, a 52-year-old Tunisian with a gift for languages, in The New York Times.

📺 The Watchlist

⚽️🏆 The Fifa World Cup 2022 concludes this weekend after a month of madness.

Croatia vs Morocco | Third-place playoff | Saturday at 8.30 pm IST

Argentina vs France | Final | Sunday at 8.30 pm IST

Both matches are live on Sports18 and JioCinema.

🏏🇧🇩🇮🇳 The first Test between Bangladesh and India is currently being played in Chittagong, with the visitors in a commanding position (at the time of publishing). The match is live on the Sony Sports Network and SonyLIV.

🤼🇮🇳 Jaipur Pink Panthers take on Puneri Paltan in the final of the ninth season of the Pro Kabaddi League on Saturday at 8 pm IST. Live on Star Sports and Disney+ Hotstar.

👀 ICYMI

🐈🏴󠁧󠁢󠁥󠁮󠁧󠁿 Football may not be going home, but Dave the cat is.

🐐🇦🇷 Also, check out this angle of Lionel Messi’s incredible assist for Argentina’s third goal in their semifinal against Morocco:

That’s all for this edition of The Playbook. Please reach out to me at jaideep@thesignal.co with any feedback (good, bad, or ugly), tips, and ideas. 

See you again next Friday!

Best,
Jaideep Vaidya

Welcome to The Playbook, a weekly newsletter on the business of sports and gaming. A warm welcome to new subscribers who joined this week. If someone shared this newsletter with you, please hit the subscribe button below — it’s free!

Subscribe now

And then there were eight. The Fifa World Cup Qatar 2022 has reached the business end after two weeks of absolute madness. 

Argentina, Belgium, Brazil, France, Germany, and Spain all suffered shock defeats in the group stage, while Japan, Morocco, Saudi Arabia, South Korea, and Tunisia ensured the World Cup isn’t just about Europe and South America. 

Morocco, ranked 22nd in the world, even made it to the quarterfinals for the first time after topping its group and knocking 2010 champions Spain out on penalties in the round of 16. Ahead of its quarterfinal against Portugal, Morocco is unbeaten in Qatar and has conceded only one goal!

So, Fifa president Gianni Infantino wasn’t exaggerating much when he hailed the group stage of Qatar 2022 as the “best ever” in the World Cup’s 92-year history. Ironically, though, Infantino is also the reason we’ll never see a group stage like this again. 

That’s because Fifa is expanding the World Cup from 32 teams to 48, starting with the 2026 edition. That means the group stage can no longer be eight groups of four, with the top two progressing to the knockouts—a format that has been excellent since it was first introduced at France 1998. And Fifa is struggling to come up with an optimal group-stage format for a 48-team World Cup. The governing body initially proposed it would be 16 groups of three teams, but this idea has been widely criticised. This article in The Athletic explains the whole conundrum.

Anyway, before this turns into another rant about Infantino and Fifa, let’s get down to this week’s story. It’s not about football (sorry!). This week, we’re digging into athlete brand endorsements.

Why Virat Kohli ditched Fire-Boltt for Noise

After making a lot of noise during the ICC Men’s T20 World Cup 2022 last month, Indian cricket star Virat Kohli is doing it on the endorsement field, too. Earlier this week, Indian wearables technology company Noise announced that it had onboarded the 34-year-old as a brand ambassador for its smartwatch range.

While that’s nothing out of the ordinary for someone like Kohli, what struck me is the fact that he was a brand ambassador of another wearables brand, Fire-Boltt, not too long ago. A quick Google seach revealed that Kohli had signed up with Fire-Boltt just in October 2021. Google also told me that Fire-Boltt last month replaced Kohli with another former India cricket captain, MS Dhoni.

This got me wondering why Kohli switched from Fire-Boltt to Noise after just one year, considering the two brands are pretty similar in stature. According to market research firm IDC, Noise is the leader in India’s smartwatch market, with a 29.5% share. Fire-Boltt is close on its heels in second place, with a 26.2% share. 

According to two industry experts I spoke to, what’s likely to have happened is Noise approached Kohli towards the end of his contract with Fire-Boltt and offered him a higher endorsement fee. 

In October 2021, when Kohli signed with Fire-Boltt, his stock was down after an extended run of poor form and resignation as India captain. His brand value had dipped from $237.7 million in 2020 to $185.7 million last year, according to the Duff & Phelps Celebrity Brand Valuation Report 2021. 

However, Kohli has turned things around this year on the field, with prolific performances at the Asia Cup (276 runs in five matches at an average of 92) and T20 World Cup (296 runs in six matches at an average of 98.6). The negative press around him has also significantly reduced in the past six months.

The length of endorsement contracts is typically between one to three years, depending on the finances involved and the athlete’s profile. Kohli even has an eight-year deal with German sportswear brand Puma, which was signed in 2017 and is worth ₹110 crore ($13 million). And when it comes to multi-year deals, it can either be a fixed term or renewable at the end of every year, said an industry expert who requested anonymity. 

“Kohli’s contract with Fire-Boltt might have just been for one year, or a longer one that allowed him to walk away after a year if they couldn’t mutually agree on a fee for the second year. My sense is that’s what happened, since he walked away after just one year. Kohli’s team probably wanted more, which they eventually got from Noise. And then, Fire-Boltt went to Dhoni, who would have been cheaper but of equal stature,” added the expert.

I tried reaching out to Kohli’s management agency Cornerstone, Noise, and Fire-Boltt to understand what really happened, but didn’t get a response. 

This also got me wondering whether a brand can terminate an endorsement deal based on an athlete’s on-field performance. According to Divya MS, business director at sports management company ITW Universe, that doesn’t usually happen because it could prove to be rather shortsighted on the brand’s part. 

“Usually, brands are inclined to terminate an endorsement deal if the celebrity no longer aligns with their particular marketing or positioning goals, but that’s typically at the end point of a contract. There are exceptions, of course, like circumstances in which a brand lets go of a certain celebrity based on other factors that make the partnership untenable. And we have seen this happen with Kanye West and Adidas recently,” she added. 

In October, Adidas terminated its partnership with the controversial rapper and designer after he repeatedly made anti-Semitic comments. Earlier this week, rival Nike also severed its contract with basketball star Kyrie Irving after he promoted an anti-Semitic film on social media.

And can the athlete walk away if they get a better deal from a rival brand? “That depends on the agreement,” said the industry expert quoted earlier. “Usually, the brand will at the very least have the right to make you the first offer. Two months before the term ends, you have to agree terms on the renewal. If they can’t agree terms, the athlete has the right to go to the market.” 

Of course, this isn’t the first time Kohli has traded rival brands. He has jumped from Nike to Adidas and then Adidas to Puma earlier in his career, although those were all multi-year contracts. The cricketer was with Nike from 207 to 2013, and then with Adidas from 2014 to 2017, before signing the eight-year deal with Puma. 

In fact, Nike had even sued Kohli in 2013, accusing him of breaching their ₹1.42 crore contract. The five-year deal, which ended in July 2013, had a clause that allowed for it to be extended by another year. Nike claimed that while it was preparing to extend the contract and also offer Kohli a new deal beyond 2014, it received a letter from the cricketer in which he “made certain self-serving and baseless allegations with respect to implementation of the contract” and rejected the extension.

Nike asked the court to restrain Kohli from signing or even negotiating any endorsement deal with other brands until the expiry of their deal. However, the court ruled in favour of the cricketer. A few months later, in early 2014, Kohli signed a three-year deal with Adidas worth ₹30 crore. His breakup with Adidas in 2017 was a lot more amicable.

I’m not quite sure whether the Fire-Boltt to Noise switch is the first time Kohli has traded rival brands after just one year. If you remember any previous instance, please write in and let me know. But I wonder if this had anything to do with his decision to move away from Fire-Boltt 😁:

⚡️Quick Singles

🎮🧑‍⚖️  The United States’ Federal Trade Commission has sued Microsoft to block its $75-billion acquisition of video-game company Activision Blizzard. The agency said Microsoft could raise the prices of Activision’s games, such as Call of Duty and World of Warcraft, for consumers who don’t use the tech giant’s consoles, or even cut off access for them entirely. Microsoft has done this before when it acquired game developer Bethesda last year and made several of its games, such as Starfield and Redfall, exclusive to its own platforms. 

🎰🇮🇳  The Indian government has asked Google to stop displaying surrogate ads of overseas betting companies like Fairplay, Parimatch, Betway, and 1xBet. Earlier this year, the government had also issued advisories to the media—print, television, and digital—asking companies to drop such advertisements. 

🎲♠️  The Indian government will also not differentiate between games of skill and games of chance whenever it decides to regulate real-money gaming. The Prime Minister’s Office reportedly overruled a proposal to only regulate games of skill and let chance-based games remain under the purview of states. 

🏀💰 The NBA will for the first time allow sovereign wealth funds, along with endowments and pensions, to acquire small stakes in the league’s franchises. The league will approve new investors on a case-by-case basis, including moew stringent due diligence for state-owned firms, reported Sportico. In 2020, the NBA became the first major US league to allow private equity firms to own minority stakes in its franchises. The NHL, MLB and MLS soon followed suit.

⛷️ The International Olympic Committee (IOC) is contemplating overhauling the system of selecting a host for the Winter Olympics, with climate change shortening the list of viable options. It could establish a rotating schedule among cities that pass the criteria, such as average minimum temperatures of below 0°C over a 10-year period for snow competition venues. As a result, the IOC will delay naming a host for the 2030 Winter Olympics, which was set to be decided next year.

🇶🇦🏅 After the Fifa World Cup, Qatar’s next target is to host the 2036 Summer Olympics, according to a Reuters report. The Gulf nation had previously failed to make the shortlist for the 2016 and 2020 Games, partly due to concerns over high summer temperatures in the country. Qatar could push to move the Olympics to later in the year, just like it has done with the Fifa World Cup.

📺⚽️ Netflix co-CEO Ted Sarandos has said his company is yet to figure out a path to profitability if it has to invest in live sports, which is built around the economics of television. He is confident the streaming service can double in size without live sports, but stopped short of ruling it out entirely. “We’re not anti-sports, we’re just pro-profit,” he said. 

👕💰 American sports merchandising company Fanatics has raised around $700 million at a valuation of $31 billion, The Wall Street Journal reported. The funding round was led by private-equity firm Clearlake Capital, with other investors including LionTree, Silver Lake, Fidelity Management & Research Co., and SoftBank. Fanatics will use the money to grow across its divisions, including a soon-to-be launched sports-betting and gaming business.

📖 Weekend Reads

🎰🇬🇧 Bloomberg has a nice long read about how Britain opened the door to online gambling and is now struggling to cope with the consequences. For four of the last five years, British gamblers have lost more than £14 billion ($17 billion) in online casino games, sports betting, and other forms of gambling. However, successive UK governments have done little to tighten the rules, with many politicians having developed close ties with the industry.

♟️ In September, Hans Niemann defeated world chess champion Magnus Carlsen at the Sinquefield Cup. The Norwegian then accused his opponent of cheating, a claim that was backed by Chess.com, which released a 72-page report concluding that Niemann had cheated in more than 100 games on its platform. However, this is the same platform that bought Carlsen’s online chess-training company, Play Magnus, for $82 million. Meanwhile, even as the matter went to court, several grandmasters studied the game between Carlsen and Niemann, and concluded that the American’s moves appeared perfectly human. So, who wronged whom? This piece in The New York Times has all the details.

📺 The Watchlist

Eight teams remain in the Fifa World Cup. Here’s a list of all the quarterfinal matches to be played over the next couple of days: 

Croatia 🇭🇷 vs Brazil 🇧🇷 | Friday at 8.30 pm IST

Netherlands 🇳🇱 vs Argentina 🇦🇷 | Saturday at 12.30 am IST

Morocco 🇲🇦 vs Portugal 🇵🇹 | Saturday at 8.30 pm IST

England 🏴󠁧󠁢󠁥󠁮󠁧󠁿 vs France 🇫🇷 | Sunday at 12.30 am IST

All matches are live on Sports18 and JioCinema.

🎧 I’ve also got a podcast recommendation for you: NPR has an excellent five-part podcast series on Lionel Messi’s extremely complicated relationship with Argentina, ahead of what’s likely to be his final World Cup. Hosted by Argentine journalist Jasmine Garsd, The Last Cup is a tale of immigration, society, culture, race, capitalism, and identity. Do check it out. 

👀 ICYMI

Can you imagine Roger Federer being denied entry to Wimbledon? Yes, it actually happened:

It’s been two months since The Playbook launched, so I wanted to check: how are you liking it? What would you like more of? Or less of? Please reach out to me at jaideep@thesignal.co with any feedback (good, bad, or ugly). Please also feel free to send any reading/listening/watching recommendations.

See you again next Friday!

Best,
Jaideep Vaidya

Welcome to another edition of The Playbook, which is The Signal’s weekly newsletter on the business of sports and gaming. A warm welcome to new subscribers joining this week. If someone shared this newsletter with you, please hit the subscribe button below — it’s free!

Subscribe now

Remember the Bloomberg feature I shared with you last week on the manufacturing origins of Al Rihla, the official match ball of the Fifa World Cup 2022? This week, thanks to Cristiano Ronaldo, we learnt a bit more about the Adidas football.

I have no idea what an IMU sensor is but this whole Connected Ball Technology sounds like a fancy term for cricket’s Snickometer, no?

Anyway, this week’s edition is not about the World Cup. It’s about football, though. Despite the World Cup going on, there has been a lot of activity in the world of European club football.

Have a few billions to spare? A top European club could be yours

In the last 25 days, three of Europe’s biggest football clubs have signalled that they are looking for investors.

Just earlier this week, the Financial Times reported that the Qatari owners of Paris Saint-Germain have held discussions with several investors since the summer for a stake sale of up to 15%. PSG president Nasser al-Khelaifi told the newspaper that the club is seeking a valuation of over €4 billion (~$4.2 billion). 

Not only would this be a world-record valuation in football, but also a significant return for Qatar Sports Investments. The state-backed fund had bought an initial 70% stake in PSG in 2011 for €50 million-€70 million, according to reports. Since then, the club has spent around €1.6 billion on superstar players such as David Beckham, Zlatan Ibrahimovic, Neymar, Kylian Mbappe, and Lionel Messi.

However, whatever valuation PSG achieves will likely be eclipsed by Premier League giants Liverpool and Manchester United. Their American owners, the Fenway Sports Group (FSG) and the Glazer family, respectively, indicated earlier this month that they are open to strategic investments and even an outright sale at the right price. 

There are a couple of things worth noting here.

One, the popularity of minority stake sales, which is what PSG is looking for. According to a report by financial consultancy Deloitte, more than half of the 40 stakes bought in Europe’s top five leagues from 2017 until October this year were minority ones. 

PSG’s owners have reportedly held discussions with at least two US-based investors and one in Europe, per Bloomberg. And just earlier this month, American private equity firm Silver Lake consolidated its position as the second-largest shareholder in Premier League champions Manchester City’s parent company City Football Group by increasing its stake from 14.5% to 18%.

Institutional investors, mostly from the US, have been increasingly investing in European football clubs because of soaring valuations. The Financial Times put this down to a boom in the price of live broadcast rights. The Premier League is expected to earn over £10 billion ($12.3 billion) between 2022 and 2025 via broadcast rights sales. 

With Liverpool and Manchester United, though, it’s a bit different. While the owners of both clubs are open to investments, reports in the UK media suggest they would prefer an outright sale. 

FSG has even prepared a full sales presentation for interested parties, according to The Athletic. As for the Glazers, they’ve reportedly been looking to sell Manchester United since the summer, but made their intentions public only after Liverpool did so as to not lose any potential buyers to their rivals. 

The fact that England’s two biggest clubs are potentially up for sale at the same time is unprecedented. Why is this happening?

The roots lie in the collapse of the breakaway European Super League (ESL) last year. Liverpool and Manchester United were among the 12 clubs that conspired to create a closed European league—with no promotion or relegation or the need to qualify, unlike the Champions League. The idea was to maximise the revenue from guaranteed matches against Europe’s top teams. However, the plans dramatically fell through within 48 hours of the announcement after a massive backlash from fans, especially in the UK. 

Without an ESL, qualifying for the Champions League is crucial for clubs from a revenue standpoint. And with the growing strength of the Premier League, qualifying is no longer a given for top clubs, unlike a decade ago. 

Just look at the Premier League table right now. Newcastle United, the newest state-owned club, are in third position. Manchester United are fifth and Liverpool sixth, with only the top four making it to the Champions League. United have failed to qualify for the tournament four times in the last 10 years. Liverpool manager Jurgen Klopp has repeatedly stated that it’s impossible to compete with cash-rich state-owned clubs, referring to Manchester City, PSG, and Newcastle.

There has also been growing discontentment among fans of both Liverpool and Manchester United with respect to their club’s owners. In 2019, FSG was criticised after the club tried to trademark the name Liverpool. And the fans have also lately been unhappy with their lack of investment in players. 

As for the Glazers, United fans have been lashing out at them ever since they took control of the club in 2005 in a £790 million ($1.3 billion) deal largely funded by debt. There have been several fan protests against the Glazer ownership over the last 17 years, including a pitch invasion last year that got a match against Liverpool called off.

Manchester United are also seeking to undergo an infrastructure overhaul, including major work on the club’s leaky stadium and training centre. In April, the club hired master planners to conduct a feasibility study to determine whether Old Trafford needs to be refurbished or completely rebuilt from scratch. This will require a lot of money, and the Glazers are unlikely to pay for it out of their own pockets, according to reports.

Then, in May, Chelsea Football Club was sold for £2.5 billion ($3.1 billion at the time)—the highest anyone had paid for a football club. The new owners, a consortium led by American billionaire Todd Boehly, also pledged to invest an additional £1.75 billion (~$2.1 billion) in player transfers, the club’s stadium and academy, and the women’s team.

You can almost imagine the eyes of the Glazers and FSG lighting up when they read the news. Both parties were then advised that it’s now the “peak period” for the valuations of top clubs, reported Sky Sports News. If there was any reluctance until then to sell their clubs, the amount of interest that the Chelsea sale generated and the bidding war that ensued probably pushed them over the line. As many as five consortiums tried to buy Chelsea, in addition to a last-minute bid by Britain’s richest person, Jim Ratcliffe, that was rejected.

The Glazers have even hired the same US-based bank, the Raine Group, that helped broker the Chelsea sale as Manchester United’s financial advisors. The Telegraph quoted sources saying they wouldn’t be surprised if some of the groups that failed to buy Chelsea now turned their focus toward United. According to reports, the Glazers could seek as much as £8 billion-£9 billion ($10 billion-$11 billion). They’ve already claimed that the club has 1.1 billion fans worldwide, although it’s a bit absurd to think that every eighth person on earth is a Manchester United fan.

Considering the global economic downturn this year, it’ll be interesting to see how investors react to so many top clubs looking for investments. Even 19-time Italian top-division champions Inter Milan are reportedly up for sale. 

The next few months should be very exciting in the business of football.

⚡️Quick Singles

🏏🏴󠁧󠁢󠁥󠁮󠁧󠁿💰 The England and Wales Cricket Board (ECB) has received a £400 million ($490 million) offer from London-based private equity firm Bridgepoint Group for the majority ownership of The Hundred. The ECB, however, is not inclined to relinquish control of its flagship franchise-based league.

🏏🌏 Eighty-two percent of the world’s top T20 cricketers don’t want to be shackled to a national contract; they want the freedom to ply their trade in lucrative T20 leagues around the world. This was among the core findings of an employment survey conducted by the Federation of International Cricketers’ Association (FICA). Note: Indian and Pakistani cricketers were not included in the survey since the two countries don’t have a players’ association affiliated with FICA.

⚽️🇮🇹 Juventus, one of Italy’s oldest and most successful football clubs, has plunged into a crisis. Its entire board, including chairperson Andrea Agnelli, resigned earlier this week amid an investigation into the club’s finances. Italian prosecutors have been investigating the accounting of players’ salaries and transfers since last year. Agnelli was one of the main architects of the European Super League.

⚽️🇵🇹🤑 Cristiano Ronaldo has received a ridiculously lucrative offer to join Saudi Arabian club Al-Nassr, following his departure from Manchester United. According to reports, the offer is worth anywhere between £100 million ($119 million) and €200 million ($210 million) per year. Ronaldo, 37, will take a call on his future after the World Cup. 

🏏🇮🇳 The Board of Control for Cricket in India (BCCI) is reportedly looking to set a base price of ​​₹400 crore (~$50 million) when it auctions the five franchises for the upcoming women’s Indian Premier League. The BCCI expects the franchises to be bought for anywhere between ₹1,000 crore ($123 million) and ₹1,500 crore ($185 million).

⚽️🇺🇸 Because of their landmark equal pay deal struck earlier this year, the US women’s football team will make more money (at least $6.5 million) because the men’s team reached the knockout stages of the Fifa World Cup 2022 than it did by winning the last two Women’s World Cups ($6 million in total).

🎮🇮🇳 Mohalla Tech, the parent company of Indian social media startup ShareChat, has decided to shut its fantasy gaming platform, Jeet11. The company is also reportedly laying off 100 employees associated with Jeet11.

🎮📱 Indian gaming unicorn Mobile Premier League (MPL) announced that it has permanently banned over a million user accounts this year. The banned users didn’t comply with the rules and resorted to unfair means to manipulate gameplay results in their favour, the company said. This was the latest move in MPL’s push to show itself as a “player-first” platform. It had earlier launched a loss protection policy during the Diwali season.

🎮💰 Indian esports startup Gamerji has raised $3 million in a pre-Series A round led by GVFL (formerly Gujarat Venture Finance Limited) and existing investor Unicorn India Ventures. The funds will be used to expand in Southeast Asia, starting with Indonesia and the Philippines, and grow in markets it recently entered, like West Asia and North Africa. 

📖 Weekend Reads

⚽️🇶🇦🗣️ If you watched any of Qatar’s matches during the Fifa World Cup, you might have noticed a section of colour-coordinated fans sitting right behind one of the goals. Almost all men, they wore identical maroon T-shirts with the word “Qatar” in English and Arabic, and never stopped chanting loudly during the games. They were the Qatari “ultras” — a highly organised fan culture prominent in Europe and South America. The only difference is that the ultras cheering for Qatar weren’t in fact Qataris. Check out James Montague’s piece in The New York Times.

🏏🇵🇰 Shoaib Akhtar is in full form in this interview with The Guardian, published ahead of England’s first tour of Pakistan in 17 years. “Had I been the fittest guy, I would’ve been the greatest ever,” he tells James Wallace.

🎮📱 If you’ve got a subscription of The Morning Context, check out this piece about how MPL has been struggling to find its next big thing, after failed attempts at getting into esports and building a social gaming community.

📺 The Watchlist

Here’s a list of all the World Cup matches to catch over the weekend:

South Korea 🇰🇷 vs Portugal 🇵🇹 | Group Stage | Friday 8.30 pm IST

Ghana 🇬🇭 vs Uruguay 🇺🇾 | Group Stage | Friday 8.30 pm IST

Serbia 🇷🇸 vs Switzerland 🇨🇭 | Group Stage | Saturday 12.30 am IST

Brazil 🇧🇷 vs Cameroon 🇨🇲 | Group Stage | Saturday 12.30 am IST

Netherlands 🇳🇱 vs USA 🇺🇸 | Round of 16 | Saturday 8.30 pm IST

Argentina 🇦🇷 vs Australia 🇦🇺 | Round of 16 | Sunday 12.30 am IST

France 🇫🇷 vs Poland 🇵🇱 | Round of 16 | Sunday 8.30 pm IST

England 🏴󠁧󠁢󠁥󠁮󠁧󠁿 vs Senegal 🇸🇳 | Round of 16 | Monday 12.30 am IST

All matches are live on Sports18 and JioCinema.

🎥🇸🇾 If you’re in the mood to watch a movie, check out The Swimmers on Netflix. It’s based on Syrian refugee Yusra Mardini’s harrowing but inspiring journey from her war-torn country to Europe, to then swimming for the Refugee Olympic Team at the 2016 Rio Olympics. 

👀 ICYMI

📢 Abubakr Abbass, a 23-year-old Kenyan, has become an accidental social media sensation during the Fifa World Cup in Qatar. No, he’s not a footballer. In fact, he’s got nothing to do with the World Cup. He’s just one of the hundreds of thousands of expats working in Qatar. 

Abbass’ job is to sit on a tennis-umpire chair, wear a large foam finger and guide people visiting Qatar’s historic market Souq Waqif to the nearby metro station by saying, “Metro, this way,” into a megaphone. It’s that simple, but the enthusiastic and endearing way in which he says the three words has made him viral. 

Meet Qatar’s “metro man”:

That’s all from The Playbook this week. See you again next Friday!

Best,
Jaideep
jaideep@thesignal.co

After a controversy-filled buildup that lasted 12 years, the FIFA World Cup Qatar 2022 is finally underway. And boy, what an absorbing tournament it has been. There’s something absurd happening every day, both on and off the pitch. And it’s just been five days! I honestly don’t know how much more drama I can take 😅.

On some level, all the gazillion off-field controversies this World Cup has attracted are so unfortunate (thanks, FIFA!). Because they’re taking the spotlight away from the football, which is, at the end of the day, what the World Cup should be about. 

We’ve already seen Saudi Arabia dominating and beating Lionel Messi’s Argentina, before Japan coach Hajime Moriyasu’s astute second-half substitutions led to Germany losing their opening World Cup game for the second time in a row. And just yesterday (Thursday), Richarlison announced Brazil’s arrival with a moment of brilliance (see ICYMI section for video).

It’s clear this World Cup doesn’t really need any off-field drama to sell itself. But alas, the people that govern world football have ensured that Qatar 2022 will be remembered for all the wrong reasons, no matter what happens on the pitch.

Back in India, we had some World Cup drama of our own, thanks to JioCinema. 

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Jio Cinema’s baptism by fire

On November 19, a day before the World Cup began, the Twitter handle of streaming platform JioCinema posted a tongue-in-cheek reply to a tweet from Elon Musk:

Little did the company’s social media team know that this tweet would come back to bite them so bad.

By November 21, JioCinema was all over Twitter like a rash. And not for the right reasons.

Users trying to watch the opening match of the World Cup between Qatar and Ecuador complained of several technical glitches, from buffering and lag to the inability to log into the app. Some users then started posting whatever hacks they could find, while others resorted to jokes and memes.

To put things mildly, it wasn’t the best of starts for JioCinema as a live sports streaming platform.

If you’re wondering why an app called JioCinema is showing live sports, you’re not alone. Parent company Viacom18 raised quite a few eyebrows in October when it announced that the FIFA World Cup won’t stream on Voot, its other video-on-demand (VOD) platform that has so far housed all its live sports content, but will be on JioCinema instead. 

Before the World Cup started, JioCinema was an exclusive VOD service for subscribers of telco Reliance Jio. Both Reliance Jio and Viacom18 are subsidiaries of India’s largest conglomerate, Reliance Industries. JioCinema, which had movies and TV shows, was free to use for people with a Jio SIM, and inaccessible for subscribers of other telcos like Airtel and Vi. 

Starting with the World Cup, that’s no longer the case. JioCinema is now accessible to everyone, regardless of which telecom network they’re on. And its content, including the World Cup, is free. Viacom18 had paid ₹450 crore ($55 million) for the rights to broadcast the World Cup in India.

Explaining why JioCinema was picked to stream the World Cup instead of Voot, Viacom18 sports head Anil Jayaraj had said, “I think it’s got lifetime downloads of some 400 million. So, it’s actually quite massive. We believe that bringing up some of the marquee content that we have, including FIFA, gives the sporting viewers a unique opportunity to watch it.” 

Viacom18 figured that the best way to reach the 722 million Indians who watch sports was via a free app that already has a substantial user base. The company’s other live sports properties, including LaLiga football and NBA basketball, are still on Voot, which has annual subscription plans of ₹299-599 ($3.6-7.3). But the plan is to eventually move these properties over to JioCinema.

 Also in the Viacom18 sports stable is the Indian Premier League (IPL), whose digital rights it purchased for a cool $3 billion in June. The company hasn’t yet taken a decision on where and how it will stream the IPL. It’s unlikely that Viacom18 will offer a $3 billion property for free, even though, monetisation of live sports will predominantly be ad-driven for Reliance.

Reliance is banking on the lifetime value of a Jio subscriber. My hunch is that Jio is trying to hook users by offering sports for free on JioCinema. And then, when the IPL comes around, it’ll either put up a paywall for non-Jio subscribers or ask them to switch to Jio to watch it for free.

In that sense, the FIFA World Cup was a test event for Viacom18 ahead of hosting the IPL. By putting the World Cup on JioCinema and offering it for free, thereby opening it up to hundreds of millions of potential users, the company probably wanted to see if it has the tech chops to handle a mega sporting event. 

The 2022 edition of the IPL had garnered 400 million viewers across television and digital, with streaming platform Disney+ Hotstar seeing a peak concurrency of 8.7 million. The FIFA World Cup is unlikely to get that many, but the 2018 edition had attracted 110.5 million viewers across TV and digital for broadcaster Sony Pictures Networks India. But Sony hadn’t offered the World Cup for free, so you can expect Viacom18 to get more viewers for the 2022 edition. 

If what happened on the opening day of the 2022 World Cup is anything to go by, JioCinema has failed the test. However, things have progressively gotten better since then for me at least, although I’m still seeing complaints on Twitter. 

I spoke to a couple of product managers who have worked in the streaming industry. They told me that there are two major factors that differentiate regular VOD, like streaming a movie or TV show, from live sports: latency and load balancing. 

Latency: It’s the time gap between what’s happening live and what you’re seeing on your screen. To reduce latency, streaming platforms need to have multiple content delivery networks (CDNs). 

A CDN is basically a geographically distributed network of servers that work together to distribute video streams quickly. “It allows you to store the information in different regions,” says one of the product managers. “Let’s say the information is getting streamed from California. You can store a copy of that information in, let’s say, Singapore. This improves the latency, since the data will not transfer all the way from California to your device. It’ll come from Singapore.”

Load balancing: While watching live sports, users hop in and off the stream quite frequently. So, streaming platforms need to have a system in place to balance the load and deal with the fluctuation. “Cricket, for instance, is a very dynamic game, where viewerships shoots up in the last few overs. So, you need to be able to ramp up the service whenever viewership spikes and then ramp it down again when users go away,” says the product manager. 

Apart from this, streaming platforms also need to solve for multiple devices and operating systems. For example, you could be watching the World Cup on your phone, which could be iOS or Android. Or it could be on a laptop, which has its own OS. Or it could be on a connected TV, which has a different system altogether. There are so many different use cases to solve for.

For instance, on the opening day of the World Cup, the JioCinema TV app didn’t allow me to log in without a Jio number. However, I was able to log in on its mobile app and website. This was fixed quickly the following day, and I have since been able to watch the matches via the TV app. 

“Device support, if not optimised, can be quickly scaled up,” says the second product manager. “They might have realised that it seems to be failing on, let’s say, iOS or Samsung TV devices. So, they would have plugged that hole very quickly.”

The heavy buffering and lag from the opening day, which is due to the latency, has also gotten better. Since it was optimised quickly, Jio probably has a CDN close to India. 

Load balancing, however, is something that can’t be fixed very quickly. “I think that is the major problem they would have faced,” says the second product manager. “Load balancing is the Achilles heel. It requires a lot of effort with the transcoding and encoding... how do you handle a sudden deluge of users, how do you scale down when the users leave.”

Given the short time frame that JioCinema had to prepare itself for the World Cup, it’s no surprise it wasn’t prepared. The company probably figured that since they’re offering it for free, people won’t mind the glitches and it’s not a deal breaker,” says the second product manager. 

This brings us to the next big question: will JioCinema be able to fix all these issues before the IPL, which is just four months away? Both product managers believe it’s not possible. “You need at least a year, if not more, to solve these things. Even Hotstar has still not perfected load balancing after being in the business for so long,” says the first product manager. 

The IPL will also bring the added complexity of inserting ads in between live play. “You’re adding another level of complexity,” says the second product manager. “You might also want to customise these ads, which is another massive effort. Hotstar is also struggling to build that utopian world where everything is hyper-personalised.”

So, as viewers, we have no choice but to be patient and hope that JioCinema’s live sports streaming experience improves over time. It’s a different matter whether advertisers will also be patient, though. 

Viacom18 has signed on 18 sponsors for the World Cup, including Mahindra, Amul, Visa, ET Money, and the Association of Mutual Funds in India (AMFI). According to reports, JioCinema is expecting to make ₹300 crore ($36.7 million) as advertising revenue from the World Cup. Will all the technical glitches during the FIFA World Cup affect its earning potential for the IPL? We’ll have to wait and see.

⚡️Quick Singles

⚽️🔴⚪️ The Glazer family is open to selling Manchester United if they receive the right offer. And if British tabloid The Daily Star is to be believed (I wouldn’t), Apple is interested. With a market cap of $2.4 trillion, Manchester United’s $4.6 billion valuation, according to Forbes, will be pocket change for the American tech major. 

But as we’ve already written in The Signal, it’ll be interesting to see how potential buyers/investors react at a time of economic downturn. Especially when Liverpool, a much more professionally managed club, is also potentially up for sale.

PS: Even Manchester United legend and Qatar World Cup ambassador (🙄) David Beckham is interested, according to the Financial Times.

⚽️🏆🤑 Despite all the controversies, FIFA is laughing its way to the bank. The governing body announced record revenues of $7.5 billion in the four years leading up to the 2022 World Cup. And revenues are expected to approach $10 billion for the next four-year cycle thanks to a new financial strategy for women’s football and the expanded 2026 World Cup in the United States, Canada, and Mexico.

🏎️🟠 Two-time Formula One champion Max Verstappen has zoomed past Lewis Hamilton as the highest-paid driver in the sport in 2022, according to Forbes. The 25-year-old earned $60 million pretax from salary and bonuses this year, overtaking Hamilton’s $55 million. The British driver had topped the Forbes rankings from 2013 to 2021. 

🏏🏴󠁧󠁢󠁥󠁮󠁧󠁿🛢️ The England cricket team will be allowed to boycott the player of the match award at the upcoming ICC Women’s T20 World Cup 2023. The award is sponsored by the Saudi Arabian Oil Company, more popularly known as Aramco. Some England players expressed reservations about the state-owned company, which was “the single greatest contributor to global carbon emissions of any company in the world since 1965,” according to The Guardian.

🏏🇱🇰🇰🇪 Sri Lanka and Kenya are both launching their own T10 cricket leagues. The first seasons of the Lanka T10 and the Africa T10 will both be held in June 2023. While Sri Lanka already has a T20 league in the Lanka Premier League, the Africa T10 will be the first franchise-based league organised by Cricket Kenya. The OG T10 league, the Emirates Cricket Board’s Abu Dhabi T10, kicked off its latest season on November 23.

🏏🇮🇳🇧🇩 Sony Sports has bagged the rights to broadcast India’s tour of Bangladesh. Featuring two Tests and three ODIs, the series will be held from December 4-26. Sony had earlier acquired the rights for India’s tour of Zimbabwe.

🎲🇮🇳 Nearly two-thirds of Indians consider fantasy sports as gambling, according to a survey conducted by community social media platform LocalCircles. The survey received 17,201 unique respondents from across India. Despite operators classifying fantasy sports as games of skill, 65% of the respondents believe they are games of chance, with financial risks involved.

📖 Weekend Reads

⚽️🇵🇰 If you own a football, there’s a good chance it was manufactured in Sialkot, a city in northeast Pakistan. More than two-thirds of the world’s footballs are made—mostly hand-stitched by women—in one of the city’s 1,000 factories. That includes Adidas’ Al Rihla, the official ball of the 2022 FIFA World Cup. Bloomberg Businessweek has a nice feature on this.

🇶🇦🛏️ Would you spend $200 a night to sleep in a shipping container? It’s what several fans visiting Qatar for the World Cup are doing—the ones who can’t afford a hotel room. Tbf, the shipping container rooms in the Fan Village do have ​​two twin beds, Wi-Fi, air conditioning, a refrigerator, and a bathroom. This New York Times story offers a peak inside container life in Qatar.

📺 The Watchlist

Here’s a selection of the best World Cup matches to catch over the weekend:

🏴󠁧󠁢󠁥󠁮󠁧󠁿England vs 🇺🇸USA | Saturday 12.30 am IST

🇫🇷France vs 🇩🇰Denmark | Saturday 9.30 pm IST

🇦🇷Argentina vs 🇲🇽Mexico | Sunday 12.30 am IST

🇪🇸Spain vs 🇩🇪Germany | Monday 12.30 am IST

All matches are live on Sports18 and JioCinema.

👀 ICYMI

🇧🇷😍 Brazil toiled for a little over an hour in their World Cup opener against Serbia on Thursday, before Richarlison decided enough is enough. The Spurs forward scored a brace to get his team’s campaign up and running, including an exquisite bicycle kick for the second. 

Early goal-of-the-tournament contender. Here’s another angle:

Brazil—and Richarlison—have arrived!

That’s all from The Playbook this week. Please feel free to write to me with any feedback or suggestions for topics to write on. See you again next Friday!

Best,
Jaideep
jaideep@thesignal.co

Cristiano Ronaldo has really done the impossible. He’s managed to get Manchester United fans to turn on him. They had stuck by him all these years despite numerous controversies, including allegations of sexual assault. But an interview with Piers Morgan was seemingly the last straw. 

And so, rather unsurprisingly, world football’s narcissist-in-chief has made it all about himself ahead of the FIFA World Cup, which begins on Sunday. The organisers of Qatar 2022 must actually be thanking Ronaldo for taking some of the spotlight off them. After all, this is turning out to be one of the most controversial sporting events of all time. And that’s before even a single ball has been kicked.

In case you don’t know what I’m talking about, I’d recommend watching Tifo Football’s new five-part series on YouTube called The Qatar World Cup Explained. Or Netflix’s FIFA Uncovered, which I recommended last week. 

Tl;dw: there are three main controversies around Qatar 2022—allegations of corruption and bribery around Qatar winning the bid to host the World Cup, the reported deaths of hundreds of migrant workers who built the stadiums that will host the World Cup matches, and the nation’s abysmal human rights record overall, including discrimination against the LGBT+ community.

And because of these controversies, brands that are sponsoring football’s showpiece event found themselves in a bit of a pickle.

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How sponsors are tiptoeing around Qatar 2022

On Wednesday, Nike dropped its commercial for the FIFA World Cup. Nearly four-and-a-half-minutes long, it’s a really fun video about a team of scientists who get the best footballers from across generations to time-travel and play against each other. Nike calls it the Footballverse.

Now, Nike is not an official sponsor of FIFA, so there was no mention of the Qatar World Cup in the video. But given the timing and the subject of the commercial, it’s clear what the company is targeting. And it’s not the first time Nike has released a commercial featuring a laundry list of some of the world’s best footballers ahead of a FIFA World Cup. My personal favourite is the one from 2010.

But what stuck out to me was the timing of the release—just four days before the World Cup begins. Usually, brands try to milk such campaigns by launching them weeks—sometimes months—in advance. I remember the 2010 Nike commercial was all over television back then. The same can hardly be said for the 2022 version so far.

And Nike isn’t alone. Even rival Adidas, which has been an official FIFA partner since 1970, is being rather shy. The German sportswear major launched its World Cup campaign on November 14, six days before the tournament begins.

And despite being an official partner, Adidas’ minute-long commercial has no mentions of either “FIFA” or “Qatar”. However, the company is organising on-ground fan zones in Qatar, along with global social media activations around the tournament.

But the absence of any reference to Qatar is a common theme in the campaigns of most World Cup sponsors, including Coca-Cola, Hyundai, Visa, Budweiser, and McDonald’s. The only sponsors whose ads have a Qatar reference are Qatar Airways and Qatar Energy, for obvious reasons, and Chinese brands Vivo and Hisense. 

As it turns out, brands are “concerned about the association with the host country because of all the controversies related to human rights,” said Ricardo Fort, founder of consultancy firm Sport By Fort Consulting, in an interview with the BBC radio show Today.

“Many of them have delayed the start of their promotions and advertising. They have also avoided explicitly talking about the FIFA World Cup in Qatar. They are referring to it as just the FIFA World Cup, and they are spending less,” added Fort, who was previously the head of global sponsorships at Visa and Coca-Cola.

This World Cup has been in the eye of the storm ever since Qatar controversially won the bid to host it back in 2010. Intense media scrutiny and investigations into the corruption and human rights abuses has resulted in brands being wary of how their sponsorship of the tournament will be perceived.

According to a YouGov survey commissioned by Amnesty International, featuring 17,000 people across 15 countries, 72% believe sponsors should call on FIFA to provide compensation for migrant workers. Amnesty noted that only four of FIFA’s 14 corporate partners and World Cup sponsors—AB InBev (Budweiser), Adidas, Coca-Cola, and McDonald’s—indicated their support for such measures. 

It helps that many of FIFA’s partners have long-term deals with the governing body. So, even if they don’t get too many returns from Qatar 2022, they can always make up for it with future editions. 

A similar thing happened during the 2022 Winter Olympics in Beijing earlier this year, when China was heavily criticised for its human rights record. A majority of brands chose to remain quiet, especially in Western countries, right up until the opening ceremony, according to an analysis by advertising-focused magazine Campaign. However, Chinese partners and brands were active in their regional markets.

“There’s a lot of conversation around striking the right kind of balance to be part of the festival, but not being perceived to support Qatar and being connected to some of the human rights issues that are likely to be raised during the tournament,” Misha Sher, global head of sports, entertainment and cultural affairs at media agency MediaCom, told Campaign. 

Another factor that could be behind the perceived lack of advertising buzz around Qatar 2022 is the timing of the tournament. A winter World Cup has messed up brands’ media planning, especially in the West. Brands are mostly tuned into dealing with sports events taking place in the summer, Neil Hopkins, global head of strategy for the M&C Saatchi Sport & Entertainment agency, told SportsPro:

“When [the World Cup is] up against Christmas, it means you end up double counting the amount you’ve got to market. So it’s either eating into your Christmas budget, which is still the most important trading event of the year for just about everybody associated with the World Cup, or you activate less against the World Cup.”

So, how will this all affect the revenue FIFA generates from the World Cup? It’s not going to matter much. According to a Bloomberg report, Qatar 2022 is on course to top the ~$5.4 billion that FIFA earned from the Russia 2018. In fact, FIFA is projected to exceed its revenue target of $6.4 billion for its 2019-2022 cycle, most of which comes from the men’s World Cup.

However, this is because FIFA has pre-sold broadcasting rights, about 240,000 hospitality packages, and nearly three million tickets, the report said. 

“What needs to be remembered is that so many of these contracts will have been signed years ago, when the scale of the human rights issues may not have been as well documented,” said Minal Modha, consumer research lead at Ampere Analysis. “The real indicator will be the impact this tournament has on revenues going forward.”

Qatar World Cup Set to Defy Controversy and Hit Revenue High | Bloomberg

I’ll be surprised if FIFA’s partners, especially the ones with long-term deals, haven’t expressed their concerns to the governing body. After all, the controversy is impacting them as well. One can only hope that FIFA learns from its mistakes and avoids a repeat in the future. There are already reports that Saudi Arabia, another country with an abysmal human rights record, is leading a joint bid to host the 2030 World Cup.

Don’t be surprised if you see an encore. 

If you want to elaborate on your answer, please feel free to write to me at jaideep@thesignal.co.

⚡️Quick Singles

🍺🚫🇶🇦 Qatar 2022 organisers are reportedly pressuring FIFA to stop the sale of beer at the eight tournament stadiums. This was after FIFA sponsor Budweiser was forced to relocate its branded beer stations outside the stadiums to less prominent spots. While the sale of alcohol is strictly controlled in Qatar, a conservative Muslim nation, the World Cup organisers had earlier allowed beer to be sold outside stadiums, at designated fan zones, and at hotels. A ban on beer, if it comes through, would complicate FIFA’s $75 million sponsorship deal with Budweiser.

✔️👟 Nike is opening an online store and trading platform for virtual sneakers, called .Swoosh. Some of the products it sells may unlock access to physical items, be available to use in video games or provide entry to real-life events. Nike has reportedly earned nearly $200 million to date from NFT products. Last year, it acquired virtual sneaker maker RTFKT.

🍎⚽️🎧  Apple has launched a new podcast dedicated to the 2022 FIFA World Cup called “After the Whistle”. It’ll be hosted by Brendan Hunt, co-creator and star of hit Apple TV+ series Ted Lasso, and NBC Sports presenter Rebecca Lowe.

📱🏈 Amazon Prime Video has launched a live, daily, 12-hour programming block dedicated to sports talk in the US. “Sports Talk” will stream from Monday to Friday from 8 am - 8 pm ET on Prime Video, and it can be accessed without a Prime subscription. Will we see something similar in India soon?

🏏🇺🇸 The first season of Major League Cricket, the new franchise-based T20 league based in the US, will be held from July 13-30, 2023, organisers announced. The primary venue for the tournament will be the newly renovated Grand Prairie Stadium outside Dallas, Texas.

🇨🇭🎾👟 Swiss shoemaker On Holding plans to capitalise on the retirement of its highest-profile endorser and part-owner, Roger Federer. The Zurich-based brand launched its first tennis shoe in 2020, its first foray outside of running. It now plans to expand into “a more lifestyle area of tennis”. 

🇩🇪💰 Activist investor Petrus Advisers is pressuring German tech company TeamViewer to end its sponsorship deals with football club Manchester United and the Mercedes Formula 1 team. Petrus, which has a <3% stake in TeamViewer, believes the deals are too expensive and show “appalling judgment”. TeamViewer is reportedly spending more than €70 million ($73 million)—about 1.4 times its net profit—on the deals. 

📖 Weekend Reads

🇳🇵👷 Hundreds of thousands of Nepalis were part of an army of migrant workers who built World Cup stadiums in Qatar. According to data from Nepal’s labour ministry, at least 2,100 of them have died in Qatar since 2010, the year it won the World Cup hosting rights. The New York Times’ Tariq Panja and Bhadra Sharma travelled to rural Nepal to speak to some of the workers and their families. 

🇶🇦⚽️ Winning the rights to host the 2022 FIFA World Cup was just one part of Qatar’s ambitious plan. The other was building a competitive team that will represent the country in its first-ever World Cup appearance. In the Wall Street Journal, Joshua Robinson writes about how Qatar built its team over the last 14 years. The Financial Times also has a similar piece.

📺 The Watchlist

⚽️🇶🇦🇪🇨 Hosts Qatar take on Ecuador in the opening match of the FIFA World Cup 2022 on Sunday at 9.30 pm IST. Live on Sports18 and Jio Cinema.

🏏🇮🇳🇳🇿 After an embarrassing defeat to England in the semi-finals of the ICC Men’s T20 World Cup, the Indian cricket team is now in New Zealand for a limited-overs tour. The first of three T20Is was washed out, with the next two scheduled for Sunday and Tuesday, both starting at 12 pm IST. Live on Amazon Prime Video.

👀 ICYMI

Sponsors may not be buzzing about the World Cup, but Indian expats in Qatar can’t wait for the action to begin. Numerous videos have been doing the rounds on social media showing Indian expats, mostly from Kerala, cheering their favourite adopted teams for the World Cup. 

Here’s one of the England fans. “It’s coming home”, apparently. 

Meanwhile, the Qatar 2022 organisers have rejected claims that these are fake paid fans. 

That’s all from The Playbook this week. See you again next Friday!

Best,
Jaideep
jaideep@thesignal.co

Indian cricket fans, how are we? I hope you’re not letting the loss to England in the ICC Men’s T20 World Cup semifinal get to you too much. You need to be strong, as Sunday will be even more difficult. It’s an England vs Pakistan final, after all. 😭

About six overs into the second innings, with England cruising along at 60-odd without loss in their chase of 169, I switched the game off and logged into Netflix to watch FIFA Uncovered. It’s a new four-part documentary series that goes deep into the chequered history of world football’s governing body. 

I’ve just watched the first episode—on the rise of former FIFA President Sepp Blatter—and it was pretty good! Netflix just gets sport, doesn’t it? Whether it’s The Last Dance, Formula 1: Drive to Survive, Icarus, Schumacher, or Athlete A, I’ve never been disappointed by the streaming platform’s sports content.

Which makes you wonder why Netflix hasn’t dipped its toes into the live sports pool yet. It seems like such a natural fit to supplement its non-live sports content. Well, it’s not like Netflix hasn't considered it. It was in September 2021 when CEO Reed Hastings told German magazine Der Spiegel that his company “would think about” bidding for F1 rights. 

Fourteen months later, Netflix still doesn’t own any live sports property. But that could change soon. There were some rather interesting developments in the world of sports streaming this week, which are all kinda connected.

Let’s dive in.

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🏄 Surf’s up for Netflix

Netflix is not only looking at offering live sports, but has even thought about buying a whole league, according to the Wall Street Journal.

The company recently considered bidding for streaming rights in sports such as tennis (ATP and WTA) and cycling in Europe and the UK, the report said. Earlier this year, it had bid for the US streaming rights of Formula One but lost out to Disney’s ESPN, which paid $255 million for a three-year deal.

Hastings reportedly doesn’t want to get caught in bidding wars. Considering the skyrocketing cost of sports rights—broadcasters in the US have spent $21.3 billion on live sports this year, up from ~$17 billion in 2019—Netflix thinks it would be a better idea to buy lower-profile leagues instead and turn them into big franchises. The company was interested in buying the World Surf League, but couldn’t reach an agreement on the price, the WSJ report said. 

Netflix would know all about increasing the popularity of lower-profile sports. Its docuseries Formula 1: Drive to Survive has completely turned the fortunes of the sport around, especially in the US, after years of stagnancy. Last month’s US Grand Prix broke the race’s attendance record, with 440,000 fans streaming in across four days. The US will host as many as three F1 races next year.

Could Netflix do something similar with surfing, which is even more niche than F1? No reason why it can’t. But the point to note is how it’s not interested in spending hundreds of millions of dollars on the media rights of high-profile sports leagues. Unlike its competitors like Apple ($250 million per year for Major League Soccer) and Amazon ($1 billion per season for the National Football League’s Thursday night games).

This isn’t surprising considering Netflix lost over a million subscribers over the first two quarters of this year, before arresting that slide and adding 2.4 million in the quarter ended September 2022. Its revenue grew 5.9% to $7.93 billion, while net profit fell 3.5% to $1.4 billion in the quarter. 

Netflix’s focus is on increasing its revenue and subscriber base, which stands at 223 million. The company hiked its subscription prices earlier this year and is launching an ad-supported tier soon. It’s also betting heavily on mobile gaming.

Netflix has also said it’ll keep its content spending steady at $17 billion per year at least till 2023. How much of that will go into sport? Netflix co-CEO Ted Sarandos said in April that the company is more committed to “sports-adjacent programming” than acquiring live sports rights:

“We’re not quite so sure that you can add the big profit stream by adding sports… I’m not saying we never would do sports, but we would have to see a path to growing a big revenue stream and a big profit stream with it.”

However, live sports is the logical next step in Netflix’s evolution. It appears to be a matter of when and not if. What I’m most curious about is how live sports would work on Netflix for users with a full ad-free subscription. Will live sports also be ad-free? That’ll be a first, in India at least.

📺📱 Disney’s multi-platform focus

Netflix’s reported flirtations with live sports even made it to The Walt Disney Company’s fourth-quarter earnings call earlier this week. An analyst brought up the WSJ report and asked Disney chief executive Bob Chapek how he sees the sports broadcast landscape changing with new entrants coming in.

Here’s what Chapek replied (excerpts):

…we really like our strong position that we have got going forward, not only in terms of the breadth of the sports that we are engaged in, but also the terms of the deals that we have. So, we have exercised with discipline. 

…we don’t need everything. We just need the right things. But also making sure that as we go forward, we are looking at multi-platform rights. We will not do deals where we don’t get multi-platform rights to give us that very flexibility that we talked about toggling between sort of the more linear traditional legacy distribution channels and that of the more digital forward-looking platforms. 

The big one that’s coming up, obviously, for us would be the NBA. We would love to be in business with the NBA. But again, we are going to do it in a fiscally responsible way and seeking multi-platform rights. 

Chapek basically said that Disney will only consider deals where it can get both the television and streaming rights. It doesn’t want to split the rights with a competitor. It’ll be interesting to see how this affects Disney’s cricket strategy, with the Indian team’s bilateral rights coming up for auction next year. 

Neither of the other two big cricket rights that went up for auction earlier this year went to a single player. In June, Disney lost the digital rights of the Indian Premier League (IPL) to its new rival Viacom18, while retaining the broadcast rights. And then in August, Disney paid a hefty $3 billion for the International Cricket Council’s (ICC) four-year multi-platform rights, before curiously sub-licensing the TV rights to Zee Entertainment.

If Disney wants to bag the multi-platform rights of the Indian cricket board, they won’t come cheap. Viacom18, Zee, and Sony Sports will be eager to get some Indian cricket on their calendars as well. At the same time, Disney plans to make cuts to its content budget after its streaming business reported a $1.47 billion loss in the quarter ended September 2022. That’s more than double the $630 million it lost in the same period a year ago. Since Disney+ launched three years ago, it has lost more than $8 billion.

Disney is also expecting a drop in the user base of its Disney+ Hotstar service, which counts India as its major market. While Hotstar added 2.9 million subscribers in the September quarter, Disney’s CFO Christine McCarthy warned that there will be a decline in the ongoing quarter because of the loss of the IPL. However, Disney expects the user growth to stabilise by the March quarter.

Hotstar faces a tough test ahead as it prepares for life without IPL. Its monthly average revenue per user (ARPU) has already declined to $0.58, a 9% drop from $0.64 in the same quarter last year. 

It's worth noting that the service's ARPU is significantly lower than other markets. For instance, an average Disney+ customer in the United States pays $6.10 per month while an average International customer (excluding Disney+Hotstar) pays $5.83 per month.

Disney+ said it earned an overall average of $3.91 per month from each customer this quarter, however if Disney+ Hotstar is excluded, the ARPU rises to $5.96 per month.

Disney+ Hotstar user base rises to 61.3 million, CFO warns of decline over IPL | Moneycontrol

Chapek said that Disney’s financial results the September quarter represented a “turning point”, and the company has reached “peak” losses that will decline going forward. Like Netflix, Disney+ is also hiking its subscription prices and launching an ad-supported tier. Its goal is to achieve profitability in its streaming business by fiscal 2024 “assuming we do not see a meaningful shift in the economic climate”.

How does this tie in with its desire of winning multi-platform sports rights? It’s a difficult balancing act—on the one hand, Disney needs to spend money on content to gain and retain subscribers. But that clashes with its goal of reining in costs and achieving profitability. 

What happens during the BCCI rights auction should give us a clearer picture as to which way Disney is tilting.

⚡️Quick Singles

⚽️🔴 The Fenway Sports Group (FSG) is considering selling Liverpool Football Club, according to The Athletic. The investment firm has produced a full sales presentation for interested parties, and hired Goldman Sachs and Morgan Stanley to assist with the process. FSG in a statement said that it would “consider new shareholders if it was in the best interests of Liverpool as a club”.

⚽️🏆🇶🇦 Former FIFA president Sepp Blatter has admitted that handing the World Cup to Qatar was a “mistake” and a “bad choice”. He blamed it on the actions of the former Uefa president Michel Platini, who he claimed was under pressure from France’s then president, Nicolas Sarkozy. Twelve years too late, Sepp.

🏏🇿🇦📺 Viacom18 will be the new home of South African cricket in India. The broadcaster has signed a seven-year deal with Cricket South Africa (CSA) to telecast and stream all international cricket played in the country from 2024-2031. The deal is reportedly worth $260 million. Last week, Viacom18 had picked up rights for South Africa’s new franchise-based T20 league, SAT20, for 10 years. That deal was reportedly worth $100 million.

🪙📉 The stunning collapse of ​​cryptocurrency exchange FTX earlier this week is likely to have implications for all its sports sponsorships. These include a 19-year, $175 million naming rights deal for the Miami Heat’s arena. It also has deals with the ICC, MLB, the Mercedes F1 team, and athletes including Tom Brady and Steph Curry. FTX is hurtling towards bankruptcy and needs a cash injection of $4 billion to remain solvent.

👟📉 Adidas will continue selling shoes based on the Yeezy brand designs despite ending its lucrative partnership with controversial musician and designer Kanye West. The German sportswear giant said it owns all the IP and designs under the brand, except the Yeezy name. Adidas, however, cut its earnings and revenue guidance for the year to account for the end of the partnership.

📖 Weekend Reads

⚽️🏓🎾 There’s a new sport that’s drawing the attention of the likes of David Beckham, Lionel Messi, and Neymar. It’s a fusion of football, table tennis, and tennis: it’s played on a curved table with a solid net in the middle and a slightly underinflated football. Players can hit the ball with any part of the body but their hands. Say hello to teqball, a sport that’s growing in popularity in the US, and is even making a play for the Olympics.

⚽️🪙 A group of American cryptocurrency investors is trying to turn an obscure English football club competing three divisions below the Premier League into “the internet’s team”. Leading the effort is Preston Johnson, a crypto millionaire, who wants to turn Crawley Town into a real-life version of  Ted Lasso’s fictional AFC Richmond, but one injected with “crypto cocaine.”

⚽️👴  The most talented players heading to the 2022 FIFA World Cup are in their mid-to-late 30s. Lionel Messi (35), Cristiano Ronaldo (37), Karim Benzema (34), and Luka Modric (37) have shared every Ballon d’Or since 2008. There’s also Robert Lewandowski (34) in the mix. Why are middle-aged men still the world’s best footballers? Simon Kuper tries to find out. 

📺 The Watchlist

🏏🏴󠁧󠁢󠁥󠁮󠁧󠁿🇵🇰 The ICC Men’s T20 World Cup final between England and Pakistan is on Sunday at 1.30 pm IST, live on Star Sports and Disney+ Hotstar. 

⚽️🏆 If you can’t bear to watch either of those teams lift the cup, check out Netflix’s FIFA documentary.

👀 ICYMI

The FIFA World Cup begins on November 20, and Kerala is ready!

Meanwhile, EA Sports’ simulator has already figured out who will win the World Cup. It’s never been wrong since 2010. 🇦🇷🏆

That’s all from The Playbook this week. See you again next Friday!

Best,
Jaideep
jaideep@thesignal.co

When I was a kid, a significant chunk of my pocket money went towards buying bubble gum. And that’s not because I liked bubble gum. Since I didn’t like the taste, the bubble gum would go into the trash. I bought the gum for what came along with it in the packet—a cricket card.

If you’re a ’90s kid like me, you probably know what I’m talking about. Brands like Big Fun, Big Babol, and Center Fresh probably made a lot of money off kids like me by selling cricket cards along with their gum. The cards used to have pictures of cricketers along with their stats. 

It was like a lottery. If you got lucky and ended up with a Sachin Tendulkar or Wasim Akram card, you could brag about it to your friends for a long time. And if you ended up getting two or more cards of the same cricketer, you could trade it with your friends. To this day, I regret not holding on to my collection.

Why am I talking about bubble gum and cricket cards? Because today’s topic is kinda related to it. It’s about the digital version of these cricket collectibles, which are being traded for hundreds and thousands of dollars online and even being used in a shady form of fantasy sports.

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The murky concoction of NFTs and fantasy sports

Virat Kohli’s six over long-on off Haris Rauf, in the India-Pakistan match of the ICC Men’s T20 World Cup, is already part of cricket folklore. It may not be the best shot the 34-year-old has played in his career, but it’ll be remembered years down the line because of the context.

Now, you can watch and admire that shot online whenever you want. But what if you could own it? 

In January this year, the International Cricket Council (ICC) unveiled its official digital collectibles range called Crictos. These are basically video clips of the most memorable moments from a match in an ICC tournament—fours, sixes, wickets, etc. And you can own these slices of cricket history via blockchain—the technology that underpins cryptocurrencies.

Essentially, Crictos are NFTs, or non-fungible tokens. They’re digital assets based on blockchain that come with unique identification codes and metadata that distinguish them from each other. As a result, they can be made as scarce as the platform minting them wants them to be. Buying an NFT basically gets you a unique code that proves you’re one of only X people in the world who owns that particular digital collectible.

The ICC Crictos are being minted, or created, by a San Francisco-based company called FanCraze. Thanks to a partnership with the ICC sealed earlier this year, it currently has more than 120,000 video collectibles from ICC events. It also has partnerships with the Asian Cricket Council (ACC), Cricket West Indies, Chennai Super Kings, Delhi Capitals, and players such as Kohli, MS Dhoni, Rohit Sharma, Hardik Pandya, Muttiah Muralitharan, and Jonty Rhodes.

FanCraze isn’t the only platform dabbling in cricket NFTs. On 20 October, days before the India-Pakistan match, a Singapore-headquartered cricket NFT platform called Rario announced that it had signed on Indian cricket legend Sachin Tendulkar as a strategic investor and brand ambassador.

Rario has a roster of over 900 international cricketers including retired legends such as Virender Sehwag and Zaheer Khan, and current players like Rishabh Pant, Dinesh Karthik, Arshdeep Singh, Lungi Ngidi, and Temba Bavuma. It doesn’t make video NFTs, though. Instead, it mints player cards. Just like the ones you used to get with your bubble gum, but a digital version.

Both Rario and FanCraze have a marketplace where users can buy and sell their NFTs. On FanCraze, NFTs are currently selling for as low as $3. And if you’ve got $50,000 to spare, you can own a clip of Tendulkar pulling Aamer Sohail for a boundary to reach his first World Cup half-century, during the 1992 ICC Men’s Cricket World Cup. On Rario, player cards are being traded for anywhere between $1 and $1,000. 

Both platforms have divided their NFTs into four tiers, depending on their scarcity. The Tendulkar NFT quoted above is in the “Legendary” category on FanCraze, which means there are only 25 copies of it.

Of course, all these prices are purely speculative. An NFT of Norwegian footballer Erling Haaland, minted by football NFT platform Sorare, was sold for over $600,000 earlier this year. $600,000 for a digital player card 🤯. 

And the way NFTs work, no matter how much you pay for one, you don’t even become the owner of that intellectual property. An NFT is just metadata attached to an image or video proving that it’s unique. It is a digital receipt. As Matt Levine puts it in his Bloomberg magnum opus on crypto: “These NFTs may not represent ownership in any particularly binding sense, but they represent a feeling of ownership.”

Thanks to the speculative nature of the NFT bubble, there are also concerns that it’s used for illegal activities such as money laundering. 

Although transactions are recorded on a public ledger, purchasers can remain anonymous, a huge boon for anyone looking to discreetly wash assets. There’s no mechanism in place to prevent launderers from creating multiple accounts and transferring assets between them to further obfuscate the trail.

Are NFTs being used to launder money? | Fortune

Another criticism of NFT trading is that it’s environmentally unethical since blockchain technology involves complex computational calculations that consume a lot of electricity.

But I’m not going to go into the pros and cons of trading NFTs. There’s enough literature out there in case you’re interested in reading more about it. I actually want to talk about another service offered by sports NFT platforms—fantasy sports.

Both Rario and FanCraze offer fantasy cricket games involving the NFTs available on the platforms. The basic idea is the same as any fantasy sports game: you pick a team of players either for a single match or an entire tournament, like the ICC T20 World Cup, and get points based on how those players perform in real life.

The difference is that you need to buy NFTs of the players you want in your team in order to play. And most importantly, the points that your NFT earns depend on its tier, or scarcity.

For instance, if I play with a “Common” NFT of Virat Kohli in the FanCraze Flash League, I’ll get fewer points than someone with “Rare”, “Epic”, or “Legendary” NFTs of Kohli. FanCraze awards points based on five criteria: rarity, serial number, level, quality, and crafting of the NFT. It’s a rather complex scoring system.

Similarly, Rario’s D3 game awards a Tier Boost based on the tier of the NFT used, and an XP Boost based on the number of times you use a particular NFT in matches.

This is a major red flag. Because it’s not a level playing field, and that skews the game towards a game of chance rather than a game of skill. And games of chance are illegal in most parts of India. Only certain formats of fantasy sports have been deemed games of skill, and thereby legal, by Indian courts. 

Rario’s D3 is particularly skewed towards a game of chance because it allows you to pick teams of only three players. And what’s more, one of those three players need not even be playing in that match or tournament. D3 allows you to pick a card of a retired player as a proxy for a current player. So, for example, if you own a Tendulkar card, you can use it in place of any other India batter. 

This is especially surprising considering one of Rario’s major investors is Dream Capital, the corporate venture capital arm of Dream Sports, a sports tech company that operates India’s largest fantasy sports platform, Dream11. Dream Capital had invested as much as $120 million in Rario earlier this year.

In August 2021, Dream11 claimed a huge victory when India’s Supreme Court ruled that its format of fantasy sports is a game of skill. One of the major points of its format is that participants have to choose a team consisting of the same number of players playing in a real-life sports team. So, a cricket fantasy game should have 11 players. 

That’s not the case with D3.

This is similar to Sorare’s fantasy football game, where you get to pick only five players in your team instead of 11. And the Paris-headquartered company has grabbed the attention of gambling regulators in the United Kingdom and Europe. Sorare has denied that its game amounts to gambling. 

However, gambling is legal in the UK and certain European markets. So, in the worst-case scenario, Sorare will have to get a gambling licence. But that’s not the case in India, where gambling is illegal in most states. 

Another legal concern for platforms offering video NFTs of sports matches is IP rights. “It’s not as straightforward as saying, just because you own the footage, you can go ahead and do whatever you want with it,” said an industry expert, who requested anonymity. 

“There are so many other things to consider in a video NFT. For instance, if you’re selling an NFT of Virat Kohli hitting a six, the video will also have the bowler, the wicketkeeper, and sponsor logos on the team jerseys and on the ground. If the ICC is going to receive a cut from every resale of an NFT, then the players, the sponsors, the boards would all have a right to come and say, ‘This NFT also includes our rights, so we also need to be paid.’ Is this a product that can be monetised in perpetuity? That, I think, is the larger issue.”

I contacted the founders of both FanCraze and Rario, Anshum Bhambri and Ankit Wadhwa, for comment but didn’t get a response before publication.

What’s also interesting is that the NFT sports industry seems to be going strong despite the crypto crash over the last 12 months—the crypto industry’s market cap has dropped from $3.2 trillion to under $1 trillion. 

While Rario tied up with Tendulkar, FanCraze signed up Kohli and Dhoni last month ahead of the T20 World Cup. And earlier this week, it was reported that the Premier League is lining up a $34.4 million-a-year deal with Sorare, which already has partnerships with other European leagues like La Liga, Bundesliga, and Serie A. Overall, the NFT sports collectible market is worth $1.4 billion and could rise up to $92 billion in a decade’s time.

Would you consider buying a sports NFT for hundreds or thousands of dollars? I’ll just say that I miss the days when all you had to do to own a sports collectible is buy bubble gum. 

⚡️Quick Singles

⚽️🇶🇦🔈 The organisers of the FIFA World Cup 2022 in Qatar are recruiting up to 1,600 fans for an all-expenses-paid trip to Doha. In exchange, they’ll have to post positive social media content about the tournament and the host nation, and sing in the opening ceremony. Up for some state-sponsored propaganda?

🏀📱🤑 The NBA is reportedly preparing to sell a streaming-only package worth $1 billion a year in the United States from its next rights cycle, beginning in 2025. Are you listening, Apple and Amazon?

🇮🇳🎮 The Indian government is pushing developers to create video games inspired by the mythological epics Mahabharata and Ramayana, and iconic films such as Sholay and Baahubali.

♠️💰 Online gaming unicorn Games24x7 has launched a corporate investment arm, which will invest ₹400 crore ($48.3 million) in the next five years in early-stage startups at the intersection of technology and interactive entertainment.

🎮📱 Netflix has acquired Spry Fox, a Seattle-based independent gaming studio, in its latest push into mobile games. Netflix already offers 35 games to its subscribers and recently announced that 55 more are in development.

⛳️💰 TMRW Sports, the sports startup launched by Tiger Woods and Rory McIlroy, is attracting big-name investors. Like Stephen Curry, Lewis Hamilton, Serena Williams, Alex Morgan, and Justin Timberlake. TMRW Sports’ first venture is a new golf league, which will kick off in 2024.

📖 Weekend Reads

⚽️🇧🇷 Days after losing Brazil’s presidential election, Jair Bolsonaro finally accepted defeat and agreed to a transition of power. But not before the far-right leader turned the Brazil national football team’s yellow jersey into a political weapon. This piece in The Athletic captures how Brazil’s far right kidnapped the most famous shirt in football.

🏏🇮🇳 This is the lede of former Australia captain Greg Chappell’s piece in The Sydney Morning Herald on Kohli’s innings against Pakistan:

The Bhagavad Gita is the holy book which is the synthesis of Hinduism. Literally translated, it means “the song by God”. Virat Kohli played an innings that was as close to a “song by god” as has ever been played in T20 cricket.

I’m sure I don’t have to sell it more to you.

📺 The Watchlist

🏏🏆 The Super 12 stage of the ICC Men’s T20 World Cup ends this weekend, with all to play for in both groups. There’s a triple-header on Sunday that will decide the fate of Group B:

South Africa vs Netherlands at 5.30 am IST

Pakistan vs Bangladesh at 9.30 am IST

India vs Zimbabwe at 1.30 pm IST

⚽️🏴󠁧󠁢󠁥󠁮󠁧󠁿 And then, in the evening, you can switch to football. There are a couple of exciting clashes in the Premier League: 

Chelsea vs Arsenal at 5.30 pm IST

Tottenham Hotspur vs Liverpool at 10 pm IST

All matches are live on Star Sports and Disney+ Hotstar.

👀 ICYMI

🏏🇮🇳🇧🇩 India beat Bangladesh by five runs via the DLS method in a rain-affected match on Wednesday. And like it is during nearly every India-Bangladesh cricket match, at least in major events, there was some controversy. 

Bangladesh captain Shakib Al Hasan was seen talking animatedly with the umpires minutes before the match restarted following the rain delay. He was supposedly unhappy with the playing conditions. After the game, he was quizzed about that conversation by a journalist. Here’s how it went:

And you wonder why relations between cricketers and the media aren’t great.

That’s all from The Playbook this week. See you again next Friday!

Best,
Jaideep
jaideep@thesignal.co

I hope you had a great Diwali! I mean, I’m pretty sure you did, thanks to Virat Kohli. How many times have you watched the highlights of the India-Pakistan match so far? In fact, it would be pretty interesting if Disney+ Hotstar reveals the viewership figures of their highlights package.

Meanwhile, the Board of Control for Cricket in India (BCCI) made sure that Diwali was extra special for the Indian women’s team, too. 

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♂️♀️💵 One small step for Indian women’s cricket…

Minutes before the Indian men’s cricket team took to the field to play its second match of the T20 World Cup on Thursday, BCCI secretary Jay Shah put out the following tweet:

Centrally-contracted players, both male and female, will now earn the same match fees: ₹15 lakh per Test, ₹6 lakh per one-day international (ODI), and ₹3 lakh per T20 international. Until now, women cricketers were earning ₹4 lakh per Test and ₹1 lakh per ODI and T20I. “This is a landmark decision as we enter a new era in India Cricket,” Shah was quoted as saying in a subsequent press release. 

Indeed, this is a landmark decision. Only New Zealand has a similar equal-pay arrangement—announced in July—in the world of cricket. 

However, as Shah himself said in his tweet, it’s just the “first step towards tackling discrimination”. And a very welcome first step. But there’s a lot more that needs to be done.

For one, the Indian women’s team hardly plays as many matches as the men’s team. 

Secondly, the match fee is just one part of the income earned by centrally-contracted cricketers. The BCCI also has annual retainers, with four different pay grades for men and three for women. The highest-earning male cricketer gets ₹7 crore (~$850,000) per year. On the women’s side, it’s just ₹50 lakh (~$60,600). 

Jay Shah or the BCCI didn’t say anything about annual retainers in Thursday’s press release, but ESPNcricinfo reports that the board held discussions over this with top women cricketers including India captain Harmanpreet Kaur.

However, an important thing to note is that any changes to match fees or annual retainers will only affect the 19 international cricketers who have central contracts. For the dozens of domestic cricketers in India, there is no change in their pay. 

And these are cricketers who only earn ₹20,000 (US$242) per one-day match and ₹10,000 (US$121) for T20s, along with a daily allowance when on tour. They don’t have any annual retainers. And they only play around 10 one-day games and as many T20 matches per year. A back-of-the-envelope calculation would indicate that India’s domestic women cricketers don’t earn more than ₹3 lakh ($3,640) in a year from match fees. 

This is why the best women’s cricketers in the country mostly play for the Indian Railways, which is practically the only employer in women’s domestic cricket. The Indian Railways provides financial security, with a permanent job and a salary.

In comparison, New Zealand Cricket’s recent match-fee overhaul includes domestic cricketers: 

From 1 August, the women’s national team and domestic women’s players will receive the same match fees as men as part of a five-year deal struck between New Zealand Cricket, the six major associations and the players’ union.

It is the first time the men’s and women’s professional environments have been combined in one agreement, with the new figures calculated from all NZC forecasted revenue over the course of the deal, a proportion of which – amounting to an expected $104m – is allocated to professional players.

It means the highest ranked White Ferns player can receive a maximum of $163,246 a year, up from $83,432, while the top-ranked women’s domestic players would be able to receive a maximum of $19,146 (up from $3,423).

New Zealand Cricket strikes pay equity deal so women and men earn same match fees | The Guardian

In 2020, the Sports Law & Policy Centre, Bengaluru, published a report called An Equal Hue: The Way Forward For The Women In Blue (pdf). The report, co-authored by former India cricketer Snehal Pradhan, and journalists Karunya Keshav and Sidhanta Patnaik, had some other recommendations for the BCCI in terms of bringing parity between male and female cricketers.

These included increasing the prize money for domestic tournaments, renegotiating the share of media rights, encouraging financial literacy among players through counselling, removing financial barriers to enter cricket, incentivising corporates and public sector units to employ female cricketers under a sports quota, and a commitment to invest in women’s sport for a five- to 10-year cycle. 

What would also help is if the ICC starts offering equal prize money at its tournaments for men and women. The total prize money for the ICC Women’s World Cup 2022 was $3.5 million, which is just over a third of what the governing body offered for the last men’s edition in 2019—$10 million. The ongoing ICC Men’s T20 World Cup 2022 has a total prize pool of $5.6 million.

Of course, prize money is a factor of how much sponsors are willing to commit to a particular tournament. Which in turn is a factor of the expected reach of that tournament. It’s no secret that the ICC and its sponsors get far more traction from the men’s tournaments than the women’s.

But as the Equal Hue report states, the main arguments against equal pay “are all factors of historic under-representation and under-funding for the women’s game”. 

The justifications used to pay women less are those missteps from administrators that have kept women as second citizens in the sport; the burden of getting fans and sponsors and revenue flocking to female sportspersons should not be on the player – the player’s focus, as the cliche goes, should be on the process, not the results – but instead on those running and marketing the sport.

Which is why what happened in the US earlier this year is so remarkable. After years of litigation, debate, and discussions, the US Soccer Federation reached a landmark agreement that will guarantee players from the men’s and women’s national teams the same pay when competing in international matches and competitions:

In addition to equal rates of pay for individual matches, the deals include a provision, believed to be the first of its kind, through which the teams will pool the unequal prize money payments U.S. Soccer receives from FIFA, world soccer’s governing body, for their participation in the quadrennial World Cup. Starting with the 2022 men’s tournament and the 2023 Women’s World Cup, that money will be shared equally among the members of both teams.

The agreements were reached just over six years after a group of stars from the World Cup-winning U.S. women’s national team began a campaign to overcome what they said was years of wage discrimination by U.S. Soccer against its female players. 

U.S. Soccer and Top Players Agree to Guarantee Equal Pay | The New York Times

The difference in prize pools is much higher in Fifa tournaments than in ICC events. The 2019 Fifa Women’s World Cup, which had 24 teams, had a prize pool of $30 million, while the 32 teams participating in the men’s Fifa World Cup 2022 will split $450 million.

However, a major reason this landmark agreement was possible is because the American women are far more successful than the men. The women’s team won successive World Cups in 2015 and 2019, while the men failed to qualify for the 2018 tournament.

That’s not the case in Indian cricket, where the women’s team is yet to win a World Cup, while the men have won it three times across formats. So, it’s unlikely that we’ll get to see a similar deal in Indian cricket anytime soon.

But at least the BCCI has taken that crucial first step towards equal pay. The board also recently confirmed that a five-team women’s IPL will be held in 2023 ahead of the men’s edition. One can only hope that the BCCI follows through and takes many more steps towards bridging the gender pay gap.

⚡️Quick Singles

🏏🇦🇺 IPL franchises are willing to pay up to $5 million to get Australian cricketers to ditch their Cricket Australia contracts and play for their teams year-round, according to a report in The Age. Agents have indicated there is little interest from their players right now in the proposal, although that might change towards the end of their careers. Is this cricket’s LIV Golf moment? 

🏎️🎥 Seven-time Formula One champion Lewis Hamilton is launching a film and TV production company called Dawn Apollo Films. It already has two upcoming projects with Apple TV+: an F1 film starring Brad Pitt, and a feature documentary on Hamilton’s journey. “The goal is to make impactful stories and ultimately to inspire people through movies and storytelling,” Hamilton told Deadline. “A big part of the new company will be about social impact, community and causes.”

🏎️🇺🇸📺 Speaking of F1, ESPN has extended its broadcast deal for the sport in the United States by another three years, up to 2025. According to reports, the sports network is paying $85 million per year, which is a 17x jump from the current deal worth $5 million. When ESPN first came on board in 2018, it did not pay any rights fee for a whole year. That was, of course, before the phenomenal success of Netflix docuseries Drive to Survive.

🏎️🇩🇪 And some more F1: Audi has announced that its entry into the sport in 2026 will be in partnership with Sauber. The strategic partnership will see Audi supply Sauber with a power unit under F1’s new engine regulation rules that will kick in from 2026, focusing on 100% sustainable fuels. Sauber will be responsible for developing and manufacturing the race car, along with planning and executing race operations. Audi also reportedly plans to acquire a stake in Sauber Group.

👟❌ Adidas joined a slew of businesses that have terminated their partnership with rapper-designer Kanye West, formally known as Ye, after his anti-Semitic comments. The sportswear major said that the move is expected to have a short-term negative impact of up to €250 million ($249 million) on the company’s net income in 2022, although reports suggest the split will cost Adidas up to $1 billion in annual sales. Adidas specified in a press release that it is the sole owner of all design rights to existing products under the Yeezy brand.

📱🎮 While Facebook and Snapchat are winding down their gaming pursuits, TikTok is surging ahead. The Chinese shortform video platform is adding a dedicated gaming tab on the homepage, which will feature mobile games with ads. Financial Times reports that Tiktok is trying to emulate Netflix, which launched mobile games last year. Douyin, the Chinese version of TikTok, has offered hyper-casual games since 2019. 

📱🎲 Apple has paused gambling ads on its App Store pages after complaints from developers. This was after the tech behemoth rolled out new ad placements in the App Store, allowing developers to advertise their apps in more places. However, developers then complained that ads for gambling platforms started popping up beneath their apps, including those meant to help users recover from gambling addiction.

📖 Weekend Reads

⚽️🇬🇪🇮🇹 Napoli are on top of the Serie A table after 11 matches with 29 points, three clear of defending champions AC Milan. A lot of that is down to a 21-year-old Georgian winger named Khvicha Kvaratskhelia. Or, as Napoli fans are calling him, Kvaradona. The New York Times has a nice feature on the Georgian, who has taken Italian football by storm and transformed Napoli into a title contender. 

🏏🇮🇳🇵🇰 On Cricbuzz, Bharat Sundaresan has a nice mood piece on what it was like in Melbourne during and after the India-Pakistan match. That includes Melbourne airport, where Sundaresan bumped into both India and Pakistan cricketers hours after the game.

📺 The Watchlist

🏏🇮🇳🇿🇦 India take on South Africa in the men’s T20 World Cup on Sunday at 4.30 pm IST. Live on Star Sports and Disney+ Hotstar.

⚽️🇨🇴🇪🇸 The Fifa U-17 Women’s World Cup final between Colombia and Spain is also on Sunday, at 8 pm IST. Live on Sports18 and Voot.

👀 ICYMI

🏏🇿🇼🇵🇰 Zimbabwe took revenge on Pakistan by beating them by one run in a thrilling T20 World Cup match on Thursday. Revenge for what? The Pak Bean controversy. Apologies in advance.

That’s all from The Playbook this week. Please feel free to share any feedback or suggestions for topics to cover. You can write to me at the email address provided below. See you again next Friday!

Best,
Jaideep
jaideep@thesignal.co

Are you all set for the big game on Sunday? India vs Pakistan in the ICC Men’s T20 World Cup. At the MCG. With Diwali just around the corner. The International Cricket Council couldn’t have planned it better.

I’ll tell you who’s especially looking forward to the match—offshore online betting companies operating illegally in India. It could be one of their biggest paydays of the year. And this is despite the fact that the Indian government started blocking their websites earlier this week.

Before we dive in, here’s wishing you a very happy and safe Diwali! 🪔 On account of the festive season, there will be no editions of our daily newsletter, The Signal, on October 24 (Monday) and October 25 (Tuesday). The Intersection will publish curated weekend reads on October 22 and October 29.

As for The Playbook, the next edition will land in your inbox next Friday, October 28, as usual.

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🏏🎲 India’s sports betting whack-a-mole

If you’ve been watching sport on television or digital platforms in India for the last 18 months or so, you’ve probably seen ads by the likes of Fairplay, Dafabet, Parimatch, 1XBet, and Betway. These are all offshore online betting platforms that have started operating and advertising in India incessantly over the last 18 months, despite the fact that online betting and gambling are illegal in most parts of the country.

Their modus operandi is to advertise via the surrogate route, wherein they set up a sports news portal. So the ads that you see aren’t of Fairplay, Dafabet, or Parimatch, but rather Fairplay News, Dafa News, and Parimatch News. It’s similar to what alcohol brands have been doing for years in India—via products like music CDs, drinking water, and soda, rather than a news portal. The Indian government has only recently started cracking down on surrogate advertisements.

Meanwhile, the betting websites started catering to Indian users by accepting payments in Indian rupees and introducing a plethora of payment options. Including UPI, India’s real-time payments system. But the way they’ve set it up, it would be very difficult to trace the payments back to these companies, which are all registered in tax havens such as Malta, Curacao, and Cyprus. I’ve written about this whole sham here and here, in case you want to go a bit deeper into it.

All this has been going on since at least early 2021, but the Indian government started reacting to it only recently. In June, the Ministry of Information and Broadcasting (MIB) issued an advisory to print, electronic, and digital media to refrain from advertising online betting platforms. But just a month later, in what was a complete farce, the government’s own sports channel DD Sports showed betting ads during the broadcast of India’s cricket tour of the West Indies.

It was also around this time that Fairplay, a Curacao-registered company that brands itself as “India’s first and most trusted betting exchange”, amped up its marketing in India. It released a commercial featuring Indian celebrities Ranbir Kapoor, Kiara Advani, Mithali Raj, Saina Nehwal, and MC Mary Kom—for Fairplay News, of course. It also became the official sponsor of the Sri Lankan cricket team.

It took until early October for the Indian government to take things a bit more seriously. On October 3, the MIB issued slightly sterner and more detailed advisories to television and digital media. The advisories included screenshots of the surrogate ads that were shown on sports channels and streaming platforms. And the advisory to the TV media also carried a warning: “Contravention/violation of the above may invite penal action under the applicable laws.”

Digital media didn’t get a similar warning because it comes under the jurisdiction of the Ministry of Electronics and Information Technology (MeitY). It took a couple of weeks more for MeitY to act. 

Earlier this week, MeitY started blocking betting websites. It’s likely exercising Section 69A of the IT Act, which empowers it to block websites in the interest of the sovereignty and integrity of the country, and the security of the state. I’ve learnt that at least 15 websites have been affected: Parimatch, Fairplay, Betway, Bet365, 1XBet, Dafabet, 22BET, Fun88, Rajabets, Sky Bet, JeetWin, Cricbaba, Wolf777, 10CRIC, and CBTF. 

I’ve also learnt that broadcasters Disney Star and Sony Pictures Network India are reviewing all their betting ad deals. If you watched the India-South Africa series earlier this month on Disney+ Hotstar, the three T20 matches had betting ads, but the three ODIs that followed didn’t. 

Is this the beginning of the end for sports betting in India?

Not quite. 

Because all MeitY has done is block the main domain name of the betting websites. Like 1xbet.in, parimatch.in, dafabet.com, and fairplay.club. But what the ministry is probably realising now is that all these companies have numerous mirror websites floating around on the internet with tweaked domain names. So, for instance, if you google “1xbet”, you’ll come across domain names such as in.1xbet.com, 1xbetonline.in, and in.1x001.com. These domains are all still accessible in India.

Fairplay sent the following message to its registered users after its main domain fairplay.club was blocked: 

Dear Club member, 

Please use our new URL: https://fairplay.co.in to place your winning bets NOW!

Setting up mirror sites is an old trick in the gambling book, used by companies to circumvent local government censorships. Here’s an excerpt from a 2014 investigation by The Guardian on bookmaker bet365’s operations in China, where betting is illegal.

One former bet365 employee, who confirmed that the company was one of the larger online gambling operators accessible from China, said: “There’s nothing the Chinese government can do about it, other than block the sites, which they do. A lot of Chinese[-facing] bookmakers change their domain names on a regular basis.”

Meanwhile, a current bet365 employee confirmed it was “100% true” that bet365 altered website addresses to allow Chinese punters to keep betting when authorities shut down sites. The bet365 sites in question use obscure domain names such as www.28365365.com in their often brief lifespan.

So the government blocking your domain name is just a minor hiccup for betting companies. By one estimate, the betting companies have suffered losses of over ₹100 crore ($12 million) in total this week because of the blocking. That’s about ₹5-6 crore ($603,000-$724,000) per company on average—a drop in the ocean of their monthly deposits, which is anywhere between ₹750 crore ($90 million) and ₹1,400 crore (~$170 million).

There are dozens of betting websites operating in India, and each of them can have multiple mirror sites. If the Indian government starts going after all of them, it’ll be nothing but a futile game of whack-a-mole.

Perhaps a more fruitful plan of action would be to make it hard for betting companies to advertise and market themselves in India. And while the government is issuing advisories and warnings to the media, there are plenty of other avenues for betting companies to advertise their wares other than your TV and mobile screens.

Betting sponsorships are abundant in Indian sports leagues such as Pro Kabaddi and the Indian Super League (ISL). Eleven out of 12 Pro Kabaddi franchises and eight out of 11 ISL teams have a betting sponsor, with their logos splashed across the players’ jerseys.

The ads are not restricted to the world of sport. Companies like Fairplay have also made a splash on out-of-home advertisements like billboards, public transport, and even digital screens in housing complexes (including mine). According to reports, betting/gambling sites are spending anywhere between ₹4,000 crore ($483 million) and ₹5,000 crore ($603 million) annually on advertisements and sponsorships in India. 

It’s an arduous, uphill battle if the government is serious about curbing the growth of online betting and gambling in India. But unlike a few months ago, when it was a free-for-all, at least the authorities are now taking the matter somewhat seriously. 

⚡️Quick Singles

⚽️🇮🇳 India and Saudi Arabia are on the shortlist to host the 2027 AFC Asian Cup. Good to see the All India Football Federation (AIFF) still prioritising vanity projects over investing in the grassroots. After all, the Indian team’s preparation and performance at the ongoing FIFA U-17 Women’s World Cup has shown everyone that Indian football is in good hands 🙄.  

🏏🇸🇦 After football, golf, and Formula One, Saudi Arabia is now going big on cricket. State-owned Saudi Aramco, the world’s largest oil exporter, has signed a sponsorship deal with the ICC until the end of 2023. Aramco had sponsored the Indian Premier League (IPL) last season. On the other end of the spectrum, Australian Test captain and climate-action advocate Pat Cummins has said that he will not appear in any more ads for Cricket Australia sponsor Alinta Energy. 

🎮☁️ Netflix wants to expand its gaming vertical beyond mobile and is “seriously exploring a cloud-gaming offering”. The company will also open a new gaming studio in Southern California. Netflix already offers 35 mobile games to all subscribers for free and has 55 more in development (pdf). Meanwhile, Microsoft is going the other way around and developing an Xbox mobile store. 

PS: Netflix recently released a trailer showcasing all its sports content. The streaming giant has never had live sports, but is this a hint? 👀

⚽️🐐💰 Lionel Messi is preparing for life after football. The Argentine has launched a San Francisco-based holding company called Play Time, which will invest in sports, media, and technology. Play Time will also look to buy stakes in sports teams and invest in “football-tech”, the company said.

⚽️🇨🇳 Chinese electronics retailer Suning is reportedly looking to sell Inter Milan, six years after paying €270 million ($260 million) for a majority stake in the Italian club. Suning is the latest Chinese investor looking to reduce its exposure to European football amid economic and political troubles back home.

📖 Weekend Reads

⚽️🐐🐐 For a brief period before the 2006 FIFA World Cup, Nike had both Lionel Messi and Cristiano Ronaldo on its sponsorship roster. Then, one got away. Read this excerpt from Messi vs. Ronaldo: One Rivalry, Two GOATs, and the Era That Remade the World’s Game, a new book written by The Wall Street Journal’s Joshua Robinson and Jonathan Clegg.

🏏🇮🇳 Sourav Ganguly’s tenure as BCCI president is finally over. Three years ago, the former India captain came in with promises to make Indian cricket a better place. But “he leaves us with the realisation that the more things change, the more they stay the same,” writes Jayaditya Gupta in ESPNcricinfo.

📺 The Watchlist

🏏 The Super 12 stage of the 2022 ICC Men’s T20 World Cup begins this weekend. Hosts Australia take on New Zealand at 12.30 pm IST on Saturday, while India and Pakistan clash at 1.30 pm IST on Sunday. Both matches will be live on Star Sports and Disney+ Hotstar.

⚽️ In the Premier League, Manchester United travel to Stamford Bridge to face Chelsea at 10 pm IST on Saturday. The build-up to the big game is bound to be dominated by Cristiano Ronaldo, who will not be part of the United squad after refusing to come on as a substitute during Wednesday’s 2-0 win over Tottenham. Live on Star Sports and Disney+ Hotstar.

👀 ICYMI

🏏📱 The ICC is really going big on its non-live digital coverage of the T20 World Cup. The governing body is working with Meta to get influencers from India, Australia, and New Zealand to post Instagram Reels during the tournament. One such influencer is Indian comedian Danish Sait, who has been posting hilarious Reels featuring cricketers participating in the World Cup. 

Do not miss this one (apologies to our non-Hindi-speaking readers):

That’s all from The Playbook this week. See you again next Friday! Happy Diwali! 🪔

Best,
Jaideep
jaideep@thesignal.co

Welcome to The Playbook, a free weekly newsletter that goes deep into the business of sports and gaming from India and around the world. It will land in your inbox every Friday at 4 pm IST.

I’m Jaideep Vaidya, a Bengaluru-based journalist with over a decade of experience, largely in sports journalism. I’ve been reporting and writing on the absorbing intersection of business and sports for the last five-odd years, with bylines in publications such as The Ken, Forbes India, Quartz India, Mint Lounge, and Scroll.in. In my previous job, I authored The Ken’s weekly sports business newsletter called Moneyball. 

With The Playbook, I hope to take you beyond the headlines in the business of sports and gaming. This newsletter will cover topics such as sports broadcasting, sports sponsorship and marketing, athlete and league management, and the rabbit hole that is online gaming in India. That includes fantasy sports, real-money gaming, and sports betting/gambling. 

So, whether you’re a casual sports fan, a hardcore sports buff, or someone who works in the sports and gaming industry, I’m sure The Playbook will have something for you. In case you’d like me to cover any particular topic, or if you have any feedback/suggestions, please feel free to write to me at jaideep@thesignal.co. You can also find me on Twitter @jaideepjourno.

If you’re a subscriber of The Signal, you will receive the first four editions of The Playbook automatically. After that, you’ll have to sign up separately to receive The Playbook.

Subscribe now

Right, let’s dive into edition #1. With the ICC Men’s T20 World Cup starting this Sunday, I thought it’s an opportune time to talk about its broadcaster in India, Disney Star, which has been rather busy in the last three months. 

🐭🏏 Disney Star: down, but not out

It’s been a crazy year for the Indian sports industry, which is, of course, dominated by cricket. Broadcasters have spent over $9 billion on two major cricket properties—the Indian Premier League (IPL) and the  International Cricket Council (ICC). A third major property—the Board of Control for Cricket in India (BCCI) rights—will go up for auction sometime next year, so the madness isn’t over.

But perhaps more significantly, cricket broadcasting in India is moving away from being a monopoly. Disney Star’s reign as the one sports broadcaster to rule them all—with all three major cricket rights—is over. 

In June, Disney retained the television rights of the IPL but lost the digital rights to the new challenger to its throne—Viacom18, backed by India’s largest conglomerate Reliance Industries. Both broadcasters paid around $3 billion each for the respective rights. 

And no matter what Disney tells its shareholders on Wall Street—that the decision to let go of the IPL digital rights was a “disciplined” one and the company is focussed on achieving profitability by 2024—losing them would have stung the House of Mouse.

It’s no secret that its streaming platform Disney+ Hotstar’s subscriptions are disproportionately driven by the IPL. And Hotstar accounts for 38.4% or over 58 million of Disney+’s user base of 152.1 million. Analysts had predicted that Hotstar might lose anywhere between 25% and 50% of its paid subscribers after losing the IPL rights. In fact, during its quarterly earnings call in August, Disney revealed that it had revised its subscriber growth projections for Hotstar from 100 million to 80 million by the fiscal year ending September 2024.

But Hotstar isn’t dead and buried just yet. Far from it. 

The fightback

Just days after that earnings call, Disney scooped up the ICC rights (TV + digital) for a cool $3 billion. And then, it bowled another googly by sub-licensing the TV rights to Zee Entertainment. I had posted a short Twitter thread on how this was a smart move by both parties—a win-win:

But what was really telling was the amount Disney Star paid for the four-year ICC rights. According to industry experts I spoke to, a fair value would have been around $1.5 billion. Which means Disney paid double that amount to secure the rights. I’m told Zee is paying Disney around $1 billion to sub-license the TV rights, which means the remaining $2 billion is being covered by Hotstar. That’s at least $1 billion more than what they’re worth, according to experts.

Why is Disney overpaying? Quite simply, to prevent the new challenger from making further inroads in the market. 

“Hotstar is willing to absorb a billion-dollar loss over four years to keep Viacom18 weak. That’s the broad logic that I see,” said one of the experts, who requested anonymity. “If Hotstar wants to grow its 50 million-60 million subscribers, they need cricket. They’ve already lost IPL, so they thought let’s get ICC at any cost.” Disney Star did not respond to my request to participate in this story.

This isn’t the only example of a defensive strategy by Disney Star. In July, about a month after losing the IPL digital rights, it swooped in at the last moment to outbid Sony Pictures Networks India for the Cricket Australia rights. Disney paid anywhere between $260 million and $280 million for the seven-year deal. In terms of the valuation of India matches—which is the only metric that matters for Indian broadcasters while evaluating rights deals with foreign cricket boards, since non-India matches have negligible viewership—it corresponds to a 2x-2.5x jump.

“It was a clear precursor to what happened with the ICC rights,” said the industry expert quoted earlier. “They’re definitely not getting their money back even with the Cricket Australia rights. So, it was a clear defensive strategy—whatever rights are available in the market, let’s mop them up.”

And it’s not just Disney Star that wants to keep Viacom18 out of the cricket market. I’m told that Viacom18 almost closed the England and Wales Cricket Board (ECB) rights in August before Sony stepped in and bid higher.

“Basically, everybody has come together to keep the new player out,” added the industry expert. “Viacom18 already has IPL, they have huge ambitions, and their strategy will be more digital-first compared to the incumbent players. They would need cricket rights to get subscriptions. So, let them have as little as possible.”

The battle royale for India cricket

This sets us up for a fascinating dogfight next year when the BCCI rights go up for auction. It’s impossible to call who will win.

On the one hand, it would appear that Viacom18 will be forced to be aggressive, considering their cricket calendar comprises only two-and-a-half months of the IPL (that too, only digital), apart from a couple of smaller T20 leagues (Tamil Nadu Premier League and Road Safety World Series). The BCCI rights would allow it to fill around six more months with India cricket matches, which would give people enough reason to subscribe. 

Disney Star will be more secure considering the wall of cricket it has built in the last few months. The ICC has one marquee tournament every year in its 2024-31 schedule.

However, ICC tournaments rarely last over a month, except the quadrennial ODI World Cup. And in India, viewership spikes during ICC events are restricted to India matches, the semi-finals, and final. And as for Cricket Australia and Cricket South Africa rights, India is touring these countries only once in the 2023-27 period. So, you could argue that Hotstar, in particular, needs the BCCI rights.

And don’t forget the new combination of Sony-Zee, who are in the process of merging. In terms of major cricket rights, they only have ICC (TV only) and ECB. They missed out on the IPL completely, so they’ll be desperate to get some Indian cricket rights.

It promises to be a gripping triangular battle between Disney, Viacom18, and Sony-Zee.

Content play

Coming back to Disney, regardless of whether it wins the BCCI rights or not, the events of this year and whatever statements the company has made could imply the start of a slow pivot from focusing on live sports to original content. 

Here’s what Disney’s chief financial officer Christine McCarthy had said earlier this year: 

"One-third of the $32-billion content spend for fiscal 2022 will be towards sports. Of the balance, a meaningful amount will be dedicated to investments in general entertainment that we can leverage across all our distribution platforms. We have about 500 shows in the pipeline for local content outside of the US. Of this, 140 is in Southeast Asia. In EMEA, it is 150, and in India, 100 shows.”

Disney could look around and say, let’s crack original content. “India isn’t the same market that 21st Century Fox was solving for a few years ago,” said another industry expert. “Disney’s hope is that cricket and original content will ensure there’s no drastic fall in Hotstar numbers. Their entire focus would now be to try and preserve their numbers, since India is often the number they cite when they claim they’re at par or bigger than Netflix.”

Star under Disney today is a completely different animal compared with what it was under Fox (Disney acquired Fox in 2019). Disney isn’t going to spend millions of dollars growing domestic sports leagues in India in the hope that revenue generated from cricket helps it cover the costs. Each property it acquires, whether it’s sport or entertainment, needs to stand on its own feet.

Sport is now no longer the focus; it’s just a part of its overall content portfolio. So, will Disney go big on the BCCI rights? My guess is they won’t go beyond a certain limit. But let me know what you think!

⚡️ Quick Singles

🏏🇮🇳 The BCCI is planning to host a five-team women’s IPL in March 2023. The tournament will have 22 matches, with each team playing the others twice. Each squad will comprise 18 players, with a maximum of six foreigners. Only five overseas players can start a match, with four from ICC Full Member countries and one from an Associate nation. [ESPNcricinfo]

🏏🇮🇳 Sourav Ganguly looks to have accepted that he can no longer continue as BCCI president. With reports claiming that former India cricketer Roger Binny is set to take over, Ganguly’s three-year term might be coming to an end. But you never know when it comes to the BCCI! [The Indian Express]

⚽️🎮 Fifa has announced a multi-year partnership with online game-creation platform Roblox to launch an immersive fan metaverse experience—called Fifa World—ahead of the 2022 World Cup in Qatar. [SportsPro]

📖 Weekend Reads

🏈♟️ Professional athletes often find ways to compete even when they’re not playing. A lot of them are into video gaming, darts or other sports like table tennis and golf. The New York Times has a nice feature on the new favourite game among NFL players—chess! The story also has one of the best intros—or ledes, in journalese—that I’ve read in recent times. 

⚽️🇭🇳 How far can a prank go? In the case of Honduras footballer Alexander López, it changed the trajectory of his career. British journalist Kieran Morris has a fascinating tale in The Guardian about how he and his friend buffed up the online profile and planted tips about an obscure young footballer. Just for laughs. But then, he started going places.

⚽️🏳️‍🌈 Also in The Guardian, Jonathan Liew writes about the ramifications of Spanish footballers Iker Casillas and Carles Puyol’s “stupid joke” about coming out as gay.

📺 The Watchlist

⚽️🇪🇸 Get set for the first El Clasico of the season, with Real Madrid hosting Barcelona at the Santiago Bernabeu. With both teams sitting on 22 points at the top of LaLiga, it’s a chance for one of them to open up a gap. Live on MTV India and Voot at 7.45 pm IST on Sunday.

⚽️🏴󠁧󠁢󠁥󠁮󠁧󠁿 Over in the Premier League, high-flying Manchester City travel to Anfield to take on a Liverpool side that’s going through a bad slump. Jurgen Klopp’s injury-ridden team is sitting 10th in the table, but would be buoyed by a 7-1 thumping of Rangers in the Champions League midweek. Live on Star Sports Select HD and Disney+ Hotstar at 9 pm IST on Sunday.

👀 ICYMI

⚽️🏆 Pepsi has just released a fun new commercial ahead of the Qatar World Cup, featuring footballers Lionel Messi, Paul Pogba, and Ronaldinho. It’s a nice throwback to those iconic Pepsi football commercials from the 2000s. But I wonder what Fifa’s global partner Coca-Cola has to say about a Pepsi ad shot on a set with a Middle East theme. Would you call this ambush marketing?

That’s all from The Playbook this week. Hope you enjoyed the first edition! See you again next Friday.

Best,
Jaideep
jaideep@thesignal.co

Dear reader,

First up, a big thank you for being a loyal reader of The Signal and The Intersection.

Some of you, particularly in the last six months, have written to us asking if we are indeed taking that leap beyond our daily, free-to-read newsletter, The Signal.

I am super thrilled to announce The Playbook, a weekly newsletter that will offer a sharp and discerning perspective on the growing business of sports and gaming.

The Playbook will be authored by Jaideep Vaidya, who recently joined us from The Ken, where he wrote the highly-popular Moneyball newsletter. It will drop every Friday at 4 pm, starting this week. Save the date—October 14! The Playbook is, and for the foreseeable future will be, free to read.

Sport today has many protagonists, and they are not always those on the field. Billionaires are looking at sport as a “recession-proof” investment. It is a booming global industry pegged at $350 billion in 2021 and expected to more than double to $707 billion by 2027. Earlier this year, the Indian Premier League (IPL) media rights for the 2023-27 cycle were sold for a whopping $6 billion.

Ditto for gaming, which saw an unprecedented pandemic-time growth, with people switching to a more “active” form of entertainment. So much so that even the likes of Netflix have plunged into it. The biggest tech deal of the year involves a near $70-billion acquisition of a game studio.

This is where The Playbook comes in. Jaideep’s deep reporting and incisive analysis will give you all the necessary signals you need to understand this industry better as it evolves. The Playbook will chronicle the evolution of the sports and gaming business, connect the dots, and deliver only what you need to know.

You can write to Jaideep at jaideep@thesignal.co with tips, suggestions, praises and (hopefully) occasional brickbats. He can be reached at @jaideepjourno on Twitter. Also, do follow Jaideep on LinkedIn, where, every now and then, he will be writing a sharp take on the business of sports and gaming.

Oh, and one last (and important) thing. We respect the choice our readers make. Hence, as a policy, we will not send you our newsletters unless you choose to subscribe to them. All The Signal readers will receive the first four editions of The Playbook. It will become an opt-in newsletter thereafter, which means you’ll need to sign up separately to receive it.  

I look forward to having you on board as dedicated readers of The Playbook.

Also, I am happy to inform you that we are just 1,000-odd subscribers away from hitting that hallowed 50,000 mark. Our daily podcast, The Signal Daily (hit bell icon!), has also been growing, clocking a 3.5x growth last month.

Warm regards,

Venkat Ananth,
Co-founder and CEO, The Signal
@venkatananth