Cricket commands more attention than USA NFL football does in the USA. The recent men’s World Cup cricket finals saw 59M streaming viewers part of 518M viewers over the 48-day event. 300M users set records watched on Disney’s TV service. For the 2023 season NFL Football has 17.1M viewers per game (up 6% over 2022). A marquee broadcast can see 29M viewers for a regular season NFL game. The NFL SuperBowl draws 113M (average). A primary driver of smartphone subscriptions are attracted to free-cricket in India.
National pastimes see sporting event content used to drive paid subscription plans. Canadian Hockey (“Hockey Night in Canada”), USA NFL Football, and, globally, soccer (“Football!”). The 2022 Qatar World Cup saw 1.5B viewers globally while only seeing comparatively small audiences in USA (26M for the finals) and India (21M for the finals). Globally sports are considered key events to attract consumers of bandwidth, broadcasts, and commercials.
EkaLore has previously talked about the rights bidding war for cricket in India. Here we consider Disney’s options for its Indian services.
The viewership numbers for cricket content is India drive decisions by Internet, wireless, and home-delivered service providers. The low ARPU for these subscribers drove Disney to hedge it’s acquisition of the cricket rights for the World Cup by splitting them with Zee Entertainment to lower its costs (USD$3B for the whole deal). Now Bob Iger’s return as Chairman of Disney has cast decisions, on investment and priority of HotStar, into a new review.
Simply, Disney is not “making it up in volume” for the cost of content and operations in India. The giant subscriber numbers for Hotstar keep Disney+ streaming subscriber counts up globally. This masks the challenge of finding profits in India. Disney’s marketing felt more subscribers would add higher margin services starting at a cricket entry point. This has not worked in practice as value-driven Indians did not add higher margin services to the cricket viewing consumption.
Tough competition from JIO/Cinema/Cricket streams IPL cricket content on smartphones bundled with subscription plans. Disney was forced to add “free cricket” to plans as subscriber numbers dropped and viewership went to JIO. Competition has created good benefits for Indian consumers – and cricket fans!
Much of Disney+ subscriber growth will come from global services and content outside the USA. Price increases by NetFlix, Disney+, and others show that profitability can be found with disciplined cost management and value at price points. Time will see if Disney Hotstar can discover higher margins while struggling to provide compelling scripted content and sports. Clearly cricket will hold its own viewership regardless of the service provider.
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