The Subhash Chandra-controlled Zee group can rake in a profit of Rs 750-1,100 crore (Rs 7.5-11 billion) over the four years for which it has a contract with the Board of Control for Cricket in India to telecast all international cricket matches played in the country.

The media industry expects Zee to earn a revenue of Rs 2,450-2,700 crore (Rs 24.5-27 billion) over the next four years. It has to pay $308 million (Rs 1,447 crore) for the contract. It will also have to fork out Rs 150-250 crore (Rs 1.5-2 billion) as production costs for cricket matches.

Zee starts tapping cricket stars

According to industry estimates, Zee can earn a revenue of around Rs 1,000 crore (Rs 10 billion) from advertising and sales for 144 days of cricket, which could go up to 160 days.

This is based on the assumption of advertising revenues of Rs 10 crore (Rs 100 million) from a one-day match and Rs 10-15 crore (Rs 100-150 million) from a Test match of five days.

Of course, Zee could use the matches to leverage rates in other channels in its bouquet. But this could be neutralised by the fact that 15 per cent of the ad revenue will go to the advertising agencies as commission.

Chandra can also sell the international rights for the matches. This could go for $65-70 million (Rs 305-330 crore).

Zee is going to negotiate terrestrial rights with Doordarshan. It could earn about Rs 350-400 crore (Rs 3.5-4 billion) if it follows a structured deal that ESPN-Star had with the broadcaster, in which, apart from a guarantee fee, ESPN-Star promised to pay 20 per cent of its advertisement revenue to Doordarshan.

The channel also expects subscriptions to go up, both in the cable and direct-to-home segments. Zee executives pointed out that cable subscription revenue had been climbing 20-25 per cent, but with the cricket deal, it could jump by 50 per cent.

Zee could also be able to hike its bouquet rates by adding the sports channel, which for the time being will be sold as a separate offering.

It could generate an additional income of around Rs 700-800 crore (Rs 7-8 billion) because of growing reach -- at the moment over 5.5 million subscribers pay for the service -- and higher subscription.

Chandra is also expected to make a killing from pushing direct-to-home subscription on the sports platform. With 150,000 subscribers, the target is to hit 1 million by next March.