How Jio Cinema Could Disrupts the Sports Broadcast Industry in India with Free IPL Streaming

Since 2014, Hotstar has been attempting to create a sports broadcast monopoly in India, until Mukesh Ambani’s Jio disrupted their plans by making IPL (Indian Premier League) streaming free on Jio Cinema, but is Jio Cinema the first one to go for such kind of disruption or are they just learning from history and improvising it , well you will be surprised to know. There have been other sports clubs or organizations that have employed similar strategies in the past to gain traction and increase their user base. Some examples include:

   English Premier League (EPL) – The EPL, one of the most popular football leagues in the world, initially made its broadcasting rights available for free to fans in the UK. This helped the league to gain a wider audience and build a strong fan base before eventually moving to a paid subscription model through broadcasting partners.

National Football League (NFL) – In the United States, the NFL has provided free access to its games through its official website and mobile app, allowing fans to watch highlights, recaps, and select live games for free. This has helped the NFL to attract more viewers and engage with fans, while also generating revenue through advertising and sponsorship deals.

Major League Baseball (MLB) – MLB has also offered free access to live games and highlights through its official website and mobile app, allowing fans to follow their favorite teams and players without a paid subscription. This has helped MLB to expand its fan base and drive engagement, while also monetizing through advertising and sponsorship partnerships.

National Basketball Association (NBA) – NBA has a similar approach to MLB and NFL, offering free access to live games, highlights, and other content through its official website and mobile app. This has helped the NBA to increase its global reach and grow its fan base, while generating revenue through various commercial partnerships.

 It’s important to note that these organizations have used a combination of free access and subscription-based models to monetize their content and generate revenue. The specific strategies and approaches may vary depending on the market, audience, and overall business objectives of the sports club or organization.

 Now coming back to Jio’s strategy. This move by Jio is expected to drive the next leg of growth for the company. Let’s decode Jio’s thinking in different scenarios: 

Scenario 1: No Direct Monetization

 Jio may never make IPL viewing paid, and Mukesh Ambani has a history of introducing something for free to the masses and later monetizing it, either directly or indirectly. Jio did this with the introduction of free SIM cards, which made people realize the importance of the internet and eventually led to paid 4G subscriptions. Similarly, by offering IPL streaming in 4K for free, Jio may be creating a use-case for head room in 5G services, making users upgrade to 5G over the next few years. Once it becomes a standard, users may not want to go back to lower quality viewing, thus getting locked into the Jio 5G experience. 

Scenario 2: Direct Monetization

 Jio could introduce a subscription service, such as “Jio One”, for paid access to Jio Cinema. Using a loss leader strategy, Jio could create a competitive advantage for its other products. For example, if users buy a “Jio One” subscription to watch IPL, they may be more likely to choose Jio products in other segments over competitors. This could create a sunk cost fallacy, where users feel they need to get the most out of what they paid for and are more inclined to choose Jio over other options when recharging their SIM or shopping for groceries online.

Bonus Scenario

 Jio may be looking to get users addicted to 5G quality and then drive them to spend more on higher data plans. Watching one full match of IPL requires approximately 25GB of data, leading to more top-ups and upgrades to higher data plans. However, this short-term thinking seems unlikely for Mukesh Ambani, as he is known for his long-term vision and strategic moves.

Conclusion

 Jio’s decision to offer free IPL streaming on Jio Cinema has disrupted the sports broadcast industry in India. While direct monetization from IPL may not be significant for Jio, the secondary effects of subscription and user addiction to 5G quality could create long-term advantages for the company. Whether Jio chooses to monetize IPL directly or indirectly, this move is part of Jio’s strategic plan for growth and positioning itself as a dominant player in the Indian market.

Vikas Marwaha – Business Strategist