What in the world happened with the PSL media rights bid? 

The bidding table drama between Geo and ARY has spilled out into a battle being waged in the news media. 

On the 23rd of December, Geo and ARY found themselves sitting across a table with the Pakistan Cricket Board (PCB) in the middle. A tense struggle was underway between both sides to get the media rights to the next two editions of the wildly popular Pakistan Super League (PSL) – the PCB’s most prized product worth an estimated $300 million.  

Both sides had everything to play for. Geo’s sports channel Geo Super has been in broadcasting wilderness for years now, finding itself unable to capture media rights for cricket series and tournaments. Meanwhile ARY’s freshly launched high-definition sports channel, A-Sports, was looking to make it big and capitalise after a successful broadcasting run with the recently concluded ICC T20 World Cup. 

Normally, it would have been a simple matter of which side made the bigger bid, except on this occasion, ARY came to the table with a card up their sleeve – Pakistan Television (PTV). ARY did not come to the bidding table on their own, but rather came as part of a consortium between itself and PTV Sports. 

This has since become a bitter bone of contention. The result of the bid is currently public knowledge. Geo Sports lost out to the consortium of PTV and ARY, which secured the media rights for the PSL from 2022-23 at a price of nearly Rs 4.5 billion. In the aftermath, Geo Sports has, backed by the entire Jang group, cried foul and claimed that the consortium between ARY and PTV was illegal and promoted unfair practises. 

What went down at the bidding table, and does Geo have a case? Geo is currently pointing towards a judgement of the LHC from 2011 claiming PTV Sports did not follow fair practice as a state run broadcaster. In response, the PCB has launched a detailed statement and PTV Sports director, Dr Nauman Niaz, has told Profit that the channel did approach other parties to form a consortium and got the best offer from A-Sports and went with it. 

With Geo not backing down from its claims, it is worth looking at what went down on the bidding table, and whether or not there has been any foul play. 

What happened at the bid 

The bidding process itself is always tense. Put in two old rivals in the mix and the stakes are bound to flare. On the 1st of December, the PCB made a public tender announcement inviting bids for PSL TV Broadcast media rights for 2022-2023. By the 23rd of December, two different financial and technical proposals were received by the board. One was from Geo, and the other was from a consortium between ARY and PTV. 

The consortium had been made well before the tender was announced by the PCB. PTV Sports knew that the media rights for the PSL were up for grabs and a tender would be announced, and well beforehand had been hitting the phones and looking for a media house to partner up with – which they found in the shape of ARY’s A-Sports. PTV Sports has told Profit that Geo was also approached to form a consortium.

On the day of the actual bid, on the 24th of December, both sides sat on the same table. The way the bid works is that both sides hand over their proposals in closed packets. After the packets have been handed over, the side receiving the bids, in this case the PCB, announces a reserve price – which is the price that the side receiving the bids is willing to get. Once this reserve price has been announced, the proposals are opened in front of everyone. If both bids are above the reserve price, then the higher bid automatically gets the contract. However, if both bids are below the reserve price, the bidders are asked to revise their bids and the higher bid in a second round of bidding gets the contract. 

Say if the reserve price is Rs 50, and Side A’s bid turns out to be Rs 55 while Side B’s bid turns out to be Rs 58, then Side B will get the contract. In the same way, if only one side bids higher than the reserve price and the other does not even meet that, the side with the higher bid gets it. However, if both bids are below the reserve price then the bidders are asked to revise their offers. They then have the option of either going above the bid price or staying below. For example, if the reserve price is Rs 50, but the bid from Side A is Rs 45 and the bid from Side B is Rs 48, they will revise their offers. If Side A has a higher bid in this revised offer, they will get the contract. 

In this case, however, right before the reserve price was announced, Geo and ARY were already in a Mexican stand-off. The representative from Geo, according to a PCB press release, “raised a concern, asking the PCB what process PTVC, as a state broadcaster, had followed to align itself with ARY. The PCB rightly advised that this query was better directed towards the PTVC who would be best placed to respond.”

Once the PCB made this clarification at the bidding table, they then asked if there were any further concerns or objections before the PCB announced the Reserve Price and then opened the sealed financial proposals. As per the PCB’s handout, “no further concerns were raised and both bidders agreed for the bidding process to continue.”

The PCB’s representative then announced that the reserve price was Rs 3.584 billion. Before the proposals that had been submitted could be opened, the representative from ARY/PTV said that they had mistakenly put in their bid number for one year, not two, and that their bid should be doubled after opening. The representative from Geo objected to this, and the PCB said that “a verbal request made at this belated stage could not be entertained in order to modify the contents of the sealed financial proposal. Hence, the request was declined and this decision was accepted by the bidders.”

When the proposals were opened, Geo had a higher proposal at Rs 3.36 billion, while the proposal by ARY/PTV was worth nearly Rs 2.2 billion. If the PTV/ARYs request to consider their sum is doubled had been accepted, they would have gotten the contract. However, since neither bid matched the PCB’s reserve price of Rs 3.584 billion, the two sides were asked to revise their bids. In the next round, Geo made a bid of Rs 3.74 billion, marginally raising their initial offer. The PTV/ARY representative on the other hand, went with their initial intention to double the amount and offered Rs 4.4 billion as a bid. The media rights were then awarded to the consortium between PTV and ARY, meaning the next two seasons of the PSL will now air on PTV Sports and A-Sports. 

Why is Geo crying foul? 

Geo was clearly taken aback by this. Wounded, they left the bidding table having lost but not given up. Since then, the entire Jang Group has been on a mission to explain that the bid was lost under unfair conditions. Their target, however, has not been the PCB but rather PTV. In a report published in The News International, it was said that the consortium was made in a clear violation of the Lahore High Court’s 2011 verdict.

The 2011 verdict had ordered that no contract could be concluded unless it was based on a transparent and competitive bidding process. “However, the state-run TV in a non-transparent manner formed a consortium to bid for the rights despite a strong protest of the other bidder Geo Super,” read the report. 

Over the same issue, Transparency International Pakistan also wrote a letter to the PCB, saying that the consortium between PTV and ARY was a typical case of abuse of power and requested the Pakistan Cricket Board to examine the allegations and cancel the bid if the accusations were correct. “Why did PTV not bid independently? Who ordered PTV to form a consortium with ARY A Sports? Why has PTV not invited open tenders and without competitive bidding, made a JV with ARY? This nexus between PTV and ARY A Sports is an unholy collusion, and is also a violation of PPRA Rules,” the TIP letter says.

“The issue was brought up at the bidding table. Geo’s representative asked how the consortium between PTV and ARY had come about and the PCB representative told them that this was a question for PTV. They then agreed to move on with the auction, and when it didn’t go their way, they started a media campaign,” says Dr Nauman Niaz, who is the director of PTV’s sports channel. According to Dr Niaz, there is no need for PTV Sports to offer a tender for a partnership because it is a privately run business and thus does not need to follow the PPRA rules. 

“Despite this we followed all of the procedures to pursue a public-private partnership through the competent authority. As a business entity, our job first and foremost is to make money and see how well we can do financially. And on that front we were more profitable going for an agreement with A-Sports.” 

Dr Niaz also told Profit that they also approached Geo Super for the consortium, and that it fell through. “We approached all interested parties. We then took it to our risk management committee, and then finally to the board of directors for approval. There was nothing illegal about it and we will continue to back our agreement and we have made it very clear.” 

According to the PTV/ARY consortium, they are yet to respond directly since Geo has not approached the PCB’s grievance committee or taken the matter to court, and have “only pursued a media campaign without rhyme or reason” , said another source close to ARY. 

“Another factor in the entire situation is that the PCB is the only vendor. There are not multiple vendors out there for us to approach. Everyone is bidding with the PCB so there is no question of fairness here. Geo brought up their grievances at the bid and then both sides agreed to move forward. Why are they complaining now?” 

The PCB in its statement has also said that if Geo is still upset and unhappy with how the bid went, the appropriate forum to take the issue is the board’s grievance cell. According to board sources, even after the press release was issued no move has been made by Geo to approach the grievance cell. There has also been no news of Geo approaching the courts to settle their complaint. 

“The extraordinary interest and increase in the TV broadcast rights of the HBL Pakistan Super League underscores how popular the tournament has become despite being launched just six years ago,” PCB’s acting CEO Salman Naseer said. “I want to thank the consortium of ARY and PTV for valuing the biggest product of Pakistan cricket, which has become a source of inspiration for thousands of young children to take up the sport.”

 

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Abdullah Niazi
Abdullah Niazi is assistant editor at Profit. He also writes for The Dependent. He can be reached at [email protected]

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