Disney Star faces ₹2,583 crore loss after it aired ICC World Cup

The ICC Cricket World Cup proved to be a costly venture for Disney Star's sports segment, with operating losses skyrocketing to $315 million (₹2,583 crore) by December 2023, marking a substantial 144% increase from the previous year's $129 million (₹1,057 crore), according to The Walt Disney Company's quarterly financial report released on Thursday.

India played host exclusively to the 2023 edition of the ICC Cricket World Cup, featuring 10 teams competing in 48 matches from October 5 to November 19, 2023. Disney Star, which held the ICC TV and digital media rights until 2023, aired the matches across its Star network of channels and streamed them for free on its Disney+ Hotstar app, aiming to rival Reliance Industries-backed JioCinema's free streaming of IPL cricket matches in 2023.

Despite a significant revenue surge in the sports segment, with Star India reporting a 71% increase to $399 million from October to December 2023 compared to $233 million the previous year, the segment's operating loss surged to $315 million during the period.

The rise in operating loss was attributed to the broadcasting of the ICC Cricket World Cup, which incurred higher programming and production costs due to increased average costs per match and more matches aired. However, revenue growth from advertising was notable, driven by increased units delivered and higher average viewership, although offset by decreased rates.

While Walt Disney Company's overall sports revenue saw a 4% rise to $4.8 billion, the company's overall sports operating loss in Q1 FY24 declined by 37% to $103 million from $164 million in the previous fiscal year.

Management highlighted that Disney's sports operating income improved compared to the prior year, primarily due to ESPN's performance, despite lower results at Star India resulting from higher rights costs associated with airing the ICC Cricket World Cup.

The ICC Cricket World Cup, held once every four years, was estimated to have generated between ₹2,000 crore and ₹2,200 crore in combined advertising revenue across TV and digital platforms, significantly surpassing the Rs 1,350 crore generated in the 2019 edition. Australia emerged victorious in the 2023 tournament, which saw India host the event exclusively for the first time after a gap of 12 years, having previously co-hosted with various countries in 1987, 1996, and 2011.