Cricket broadcasting rights auction

Broadcasting rights often give exclusive rights to show a competition within some geographic area, leading to winner takes all scenarios where bidders have limited flexibility over which rights they would like to hold. The BCCI’s auction of Indian Premier League (IPL) broadcasting rights for 2023-27 included three packages of rights to broadcast in India – television, digital and non-exclusive digital broadcast of selected matches – as well as regional rights to broadcast to the rest of the world. The auction used a format in which the price per match increased continuously, with sequential run-off auctions for pairs of rights packages.

Valuing the rights was difficult for bidders, because the number of matches included and therefore the total payment was uncertain and because of complementarities between some of the packages (e.g. a bidder winning the digital broadcast and selected matches packages benefits from exclusive rights for those key matches). On top of this valuation uncertainty, bidders faced intense competition for a small number of rights, and received no information during the auction beyond the current highest bid.

We provided support to a bidder through all stages of this auction. We advised the client on how it could bid given the level of competition and the uncertainty around valuations, and we helped the client engage with BCCI to resolve ambiguities in the rules. As the auction format differed substantially from those used in other context, in particular as it had no ‘rounds’ we developed new mock auction software and provided on-site support to help with the practical participation in the auction.

Through our pre-auction work and on-site advisory, we assisted the client in implementing their bidding strategy in what became one of the biggest and most competitive sales of sports media rights in history.