MARKETS SPECTATOR: Ten's big bet

Is winning the rights to broadcast the Big Bash cricket going to propel TV broadcaster Ten Network Holdings’ stock higher? In the immediate wake of Ten’s announcement this morning, the answer seems to be no.

AT 1326 AEST the stock was down 1.5 cents, or 5.2 per cent, to 27.5 cents.  

How much Ten has paid for the right to broadcast for five years the Twenty20 Big Bash League was not disclosed by the company. But it’s clear Ten chief executive Hamish McLennan, if reports are believed that his company paid $100 million for the rights for the Big Bash, is not afraid to make a big bet that the shortest form of the game is the wave of the future.

Cheerleaders, drone cameras shooting from the sky, Shane Warne wired for sound so viewers can hear what he is going to bowl next or perhaps who he is going to sledge next, spectator fancy dress nights and fireworks – Twenty20 cricket is the closest thing Australian sport has to the razzamatazz of the US National Football League.

The purists may hate it but even the traditionalists admit the future of cricket may hinge on Twenty20. Twenty20 crowds have averaged 14,913, according to Austadiums Sport. Big Bash matchers were the most-watched programs, sports and non-sport, on subscription TV in December and January, says JP Morgan analyst Jarrod McDonald. He says Twenty20 cricket matches averaged 2.1 million viewers per match in 2011 and 2012.

Generation Y may want to spend a Friday or Saturday night with their other 20-something mates at the Big Bash dressed up as gladiators or in their old school uniforms. Twenty20 matches take just a touch longer, about three hours, than a rugby union or AFL game. That leaves plenty of time for the hipsters to go out for cocktails or to hit the clubs.

Generation X, now with children, may also like Twenty20 better than other forms of the game. It gets dads to take charge of the children on an outing that is equally exciting for the youngsters as it is for the old man. Now if only Ten can get the economics to work. Perhaps it can persuade Warne and Liz Hurley to stick around.