The 16th season of the Indian Premier League(IPL) kicked off a few days back with growing interest among cricket fans all over the world. Such is the popularity of cricket’s premium franchisee tournament that most cricket boards all over the world keep their international calendars free so that their players get an opportunity to play in this coveted tournament.
Players participating in the IPL have been able to fetch extraordinary amounts of wages from this tournament, with some players even becoming multi-millionaires by just playing one season of the IPL(which is a little less than 2 months in a year).
So, how does the IPL pay such exorbitant fees to its players, maintain franchisee presence even when it’s off-season, and make enough money to organize it in the grandest manner possible year in and year out?
Also, are the claims made by the Indian Cricket Board(BCCI) about the IPL being the second most valuable sporting league in the world substantial?
Let’s find out below!
IPL’s Whopping Brand Value
Since its launch in 2009, the IPL has recorded a 318 percent growth in brand value, from USD 2 Billion to over USD 8 Billion in 2022.
According to the Indian Cricket Board, the only global sports league more valuable than the IPL is the National Football League(NFL), which is a rather bold claim- but in this piece, we will dive into the numbers behind the IPL and how it has become a huge money-making machine for the cricket fraternity in India.
In June 2022, the IPL negotiated a broadcasting rights deal worth a whooping USD 6.2 billion for the 2023-2027 cycle with Mukesh Ambani-backed Viacom 18, Disney Star, and Times Internet according to numbers collated by ESPN Cricinfo.
This deal is double that of what it was in the cycle 2018-2022. On the back of this deal, the Indian Cricket Board Secretary announced that IPL had emerged as the second most valuable global sports league behind the National Football League, surpassing heavyweights such as the English Premier League(EPL), Major League Baseball(MLB) and the National Basketball Association League(NBA).
He is not wrong, at all!
The IPL is now the second most valued league in the world- but in terms of value per match only! After the new broadcasting rights deal, the combined per-game value in IPL on average is USD 15.1 Million only behind the NFL, which bags a whooping USD 36 Million per game on average.
For comparison, the English Premier League averages USD 11.23 Million per game currently while the Major League Baseball averages USD 9.57 million per game and the NBA averages USD 2.12 million per game according to most recent estimates.
To put things into perspective- one season of the IPL is less than 2 months, while the EPL and the NFL, the other 2 most valuable leagues in the top 3 have 10-month and 5-month-long seasons. Meaning, the deals IPL struck could have been worth more if the league had continued on for longer.
IPL is now heads and shoulders above most big-name sports leagues in the world and establishes IPL as cricket’s most valuable product while cementing the Indian Cricket Control Board as the sport’s cash cow.
How Do The Teams Make Money?
The IPL has something that is called a Central Pool: this is money earned by the BCCI from central sponsorship deals and broadcasting rights. Half of the money from this pool is retained by the board while 45% is distributed among all franchises.
The remaining 5% is bagged by the top 4 teams in the tournament, with the winners grabbing the highest amount.
For the teams, the money from the Central Pool makes up 70 to 80 percent of total revenue from the IPL.
It is expected that with the latest broadcasting deals and central sponsorships onboarded, the total revenues from the central pool may reach up to USD 7.6 Billion by 2027.
With half the share being divided among franchises, it could generate an annual income of USD 76.9 Million for each team. This is more than double the estimated income of each team in the 2022 season of USD 33.4 Million.
In addition, revenue from Team Sponsorship of each IPL team, ticket and merchandise sales(20% of ticket sales is taken by BCCI), the teams are well placed to make enough money to pay their players, maintain a good global image, and also support local cricket development.
Team owners in the IPL are so confident about making back the money they spend in the IPL that the two new IPL teams of Lucknow and Gujarat were bought for USD 940 million and USD 740 million by their respective owners.
What This May Mean For The Sport?
With IPL basically minting money- cricket authorities may have to rethink whether a new era for cricket is in the offing- where a franchise league transcends the sport- much like the NBA in Basketball. It may result in the IPL greatly expanding its turf- implications we have already seen with IPL team owners buying out teams in the South Africa T20 and the UAE-based International League T20.
The IPL’s deal – and the associated buzz – could also help ignite a 2028 bid for cricket in the Olympics, with cricket administrators continuing to convince the Olympics authorities of their trump card- a seriously emerging South Asian sports market.
So, what’s your thought? Should Bangladesh Premier League also take some notes from the IPL? Let us know your thoughts and for more updates, be with Markedium.