Had the board of Control for Cricket in India (BCCI) been a listed company, it would have been right up there-with the Infosyses, the Reliances and the TCSEs of this world-among the country's top wealth creators. Since the beginning of this year, the new Sharad Pawar-led team at BCCI has sealed deals that will see its revenues increase to Rs 3,354 crore over four years starting March 2006 from Rs 359 crore during 2000-2004. That's an 834 per cent increase over six years. Even the best performers of India Inc. will be hard pressed to match that performance. About 80 per cent of this comes from the sale of media rights.

It obviously helps that India is the new Mecca of world cricket, accounting for 80 per cent of global television viewership of 300-350 million and generating more than half its advertising revenues. "Full credit to BCCI for being able to monetise these eyeballs well," says Jamie Stewart, Global Sponsorships Manager, International Cricket Council (ICC). The cricket-oriented television advertising pie in India: about Rs 700 crore a year.

But despite this, Nimbus Communications' $612.18-million (Rs 2,755 crore approx.) bid for the global television rights to Indian cricket (2006-10) has raised eyebrows. The obvious questions: how will it raise this amount? And, can it realistically hope to earn a profit? "I will not reveal my business plan to the media," says Harish Thawani, Chairman and promoter of Nimbus.

Zee Telefilms had everyone doing double takes when it bid $308 million (Rs 1,416 crore) in 2004; that bid got bogged down in multiple litigations between Zee and the BCCI, but set the floor for any future deals. So, ESPN-Star Sports quoted a price of $401.89 million (Rs 1,809 crore) this time around. "We increased our bid price after taking into account inflation, the good showing of the Indian cricket team and the growing advertising market," says R.C. Venkateish, Managing Director, ESPN India. Zee, too, raised its bid by $205 million (Rs 923 crore approx.) to $513 million (Rs 2,309 crore approx.). Says Himanshu Modi, Business Head, Zee Sports: "We bid for the global rights in order to bolster our overall broadcast business." Explaining this, he says it would have given his fledgling channel a flying start; given dish TV, the group's DTH venture, an edge over its competitors and "allowed Zee to monetise its expanding global footprint".

But, what was the rationale behind Thawani's bid? A top executive in a media company says Nimbus, a Mumbai-based media and sports production and marketing company, "has largely remained a fringe player in its chosen businesses". Thawani hotly contests this. "Nimbus has produced over 5,000 hours of television programming in the past 15 years," he had told BT earlier. But, it's still not counted among the top TV content producers. "Nimbus has done cricket-related transactions worth Rs 6,700 crore over the past five years," he adds, but refuses to share details. "Nimbus is India's leading provider of mobile content services," he claims. "I'm not aware of it," says a leading mobile content provider.

A senior BCCI official seems closest to the mark when he says: "The bid looks like a desperate do-or-die attempt by him to make a mark. This deal might just change his fortunes forever; but if he fails, it won't be for the first time." Adds Lalit Modi, Chairman of BCCI's Marketing Committee: "According to the terms of the deal, Nimbus has to pay us an advance fee of Rs 200 crore and provide us bank guarantees of $150 million (Rs 675 crore) every year for the next four years." Of these, Nimbus has already paid BCCI Rs 160 crore and is in the process of tying up the remaining funds. Where will Nimbus raise this money from? Thawani says he has no immediate plans of approaching the markets. Can he generate the revenues to cover this amount? "No comments," he says.

The general consensus is that it's going to be a tough ride for Nimbus. According to Modi's calculations, "Nimbus will have to generate around $700 million (Rs 3,150 crore) to break even"; that's because logistics and other expenses will add about $90 million (Rs 405 crore) to his costs. To earn a 20 per cent profit, he will have to generate another $140 million (Rs 630 crore). "On the face of it, the target does look daunting," says ICC's Stewart. "But Thawani might have something big up his sleeve," he adds.

For the moment, all he's got in the bag is a $20-million (Rs 90-crore) deal with Sky Sports for the UK rights. North America, with an Asian viewership of around 100,000-150,000, "is quite lucrative from the subscription point of view," says Stewart. This can, at best, generate around $50 million (Rs 225 crore) over four years. Other markets like South Africa, Australia, Fiji, Nigeria, and Greece are practically non-starters. That means he will, as expected, have to generate the bulk of his revenues from India. And Thawani is confident he can do that. "The global economy is in good shape. India is also doing well. Several sectors, like telecom and insurance, will see explosive growth; companies in these, and other sectors, will have to advertise in order to reach a pan-India audience. For that, cricket is the ideal vehicle," he says. For now, Nimbus has tied up with nondescript channels like Sahara One and Sahara Filmi, launched 20 days ago, for the ongoing India-England series. Sources say the deal is that Nimbus markets the airtime and gives Sahara 25 per cent of the gross. This way, Thawani reaches his audience and the channels get additional revenues, and more importantly viewership.

"Nimbus has to give guarantees of $150 million every year for the next four years" Lalit Modi Chairman/BCCI's Marketing Committee

According to media buying sources, Nimbus, which is selling the airtime for both Doordarshan and Sahara, went to the market with an asking rate of around Rs 3-3.5 lakh per 10 seconds for Sahara and Rs 2 lakh per 10 seconds for dd. Most advertisers were not ready to pay more than Rs 2-2.5 lakh per 10 seconds for the satellite channels and Rs 1 lakh for the terrestrial platform. "Rates for cricket broadcast have stabilised and there can be no compromise there. If that means absence from cricket, so be it," says Sunder Raman, General Manager of Mindshare, who buys media for Pepsi. In fact, big cricket advertisers like Pepsi, Hero Honda, LG, Castrol, etc., have chosen to keep out of the India-England series this time. "This is the first time in five years that Pepsi is not advertising during a high-profile cricket series," says Raman. Reason? "The ad rates this time were absolutely unreasonable," he says. Adds Hemant Sachdev, Director (Marketing and Communications), Bharti Airtel: "Products have to be relevant in the context of price and value, otherwise there are always other options available in the market and that holds true for every business."

Cricket, incidentally, is no longer the only property delivering high television rating points (TRPs). The recently concluded India-Pakistan cricket series garnered 8-10 TRPs, whereas popular serials like Kyunki Saans Bhi Kabhi Bahu Thi and Kahani Ghar Ghar Ki on star Plus continue to deliver TRPs of between 10 and 14. Market sources say Nimbus will not be able to net more than Rs 45-50 crore from the telecast of the three Test matches and six One Day Internationals (ODIs) against England. Meanwhile, the telecast has got entangled in a minor controversy. "None of the three entities (BCCI, Sahara One and Nimbus) has permission for live telecast of the series," say sources. Counters Thawani: "We are using Doordarshan's uplinking facilities, so there is no violation of any norms."

Such minor procedural glitches are inevitable in one-off arrangements such as the one between Nimbus and Sahara One. Over a longer term, Thawani says he will either create a global cricket network or buy an existing sports channel. But in case he is not able to do so, he will have to tie up with a stronger broadcaster the next time, industry players say. Other channels, which had quoted lower amounts for the primary bid, are unlikely to pay him the premium. "It will be unrealistic to expect more than $400-410 million (Rs 1,800-1,845 crore) over the period of the contract," says Zee's Modi. "The advertising market for cricket has plateaued and subscription rates can neither be raised nor realised fully, due to rampant under-declaration of subscription numbers," says ESPN's Venkateish. Sources say Thawani chose Sahara One because the other broadcasters refused to play ball with him.

BCCI's Pawar: Midas touch

Also, as Modi points out, "in 2006, India plays only the ongoing India-England series at home. This should bring down the value of the rights by at least 10-12 per cent." The radio and broadband rights can fetch Nimbus a maximum of Rs 150-200 crore over the period of the contract. Thus, it looks like Thawani will net about Rs 2,000 crore from these sources. But, that will still leave him about Rs 1,000 crore in the red. He can think of profits only after filling this huge hole in his P&L accounts. How will he do it? Will he be able to recover this money from regional markets that he has been talking about? "Looks unlikely," says a broadcaster. Thawani says he will wait for "multiple platforms to emerge and go in for non-exclusive licensing agreements with different players to maximise revenues". But industry sources say this will bring prices down further. "Broadcasters pay a premium for exclusivity. If the same property is available on all platforms, why will anyone pay a premium for it?" asks Venkateish.

Thawani, though, exudes bravado. "Indian cricket is our biggest brand ambassador. And my mission is to go live in every continent," he says. His mission statement is laudable. And achieving his mission goals may also not stretch him too much. But whether he can do it profitably is what everyone will be watching out for. If he can, he'll prove yet again that there's no alternative to native intelligence, street smarts and business chutzpah. But if he can't-and the odds on this seem heavier-he won't be the first sports marketer to go belly up. But everyone BT spoke to swore that if anyone can pull it off, it will be Thawani.