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Introduction
Worldwide more and more money is being invested in sports teams and professional sports
leagues. There are numerous sports that are popular in different parts of the world. In the
United States, its American Football, in Europe and UK it is Football (soccer); in the Indian
sub-continent and Australia it is Cricket that attracts the largest crowds.
In todays busy and hectic lifestyle, sports has become a major part of peoples lives because it
provides entertainment and excitement. There are numerous sports that are popular in different
parts of the world. In the United States, the biggest sports market in the world, American
Football is the most popular sport, in Europe and UK it is Football (soccer), in the Indian sub-
continent and Australia it is Cricket that attracts the largest crowds. All these popular sports
have one thing in common: they all are team sports. Team sports gives a feeling of belonging to
the spectators, in international sports the feeling of belonging is towards the country, while in
league sports its towards the city/state. Worldwide more and more money is being invested in
sports teams and leagues. For example the acquisitions of Chelsea, Manchester United,
Liverpool and Manchester City football clubs in the United Kingdom. The English Premier
League signed a three year $2.7 billion television broadcast deal with BSkyB. In the United
States the National Football League earns $3.5 billion from its broadcasting rights (Spiegel,
2008). Football is one sport that is popular as an international sports as well as a league sport.
American sports like (American) Football, Baseball, Basketball and Ice Hockey do not have an
international version of the sport; even if they do (basketball) its not as popular as the domestic
league version. On the other hand Cricket is mostly popular as an international sport.
Talking about professional sporting leagues around the world, generally there is only one
major/premier league in every sport, smaller leagues exist but they are usually inferior to the
major or premier league (vertically aligned). In the USA, American Football has one league
called the National Football League (NFL), for Basketball it is National Basketball Association
(NBA), for Baseball it is Major League Baseball (MLB) and for Ice Hockey it is National
Hockey League (NHL). In the UK, 7 soccer has one major league called the English Premier
League (EPL). The situation with single major league is similar across the world, except in
India where cricket has two leagues, the Indian Premier League (IPL) and the Indian CricketLeague (ICL); both these leagues are at the same level (horizontally aligned). To allow for
comparison, below is a graphical representation of league structures in English Football,
American Baseball and Indian Cricket:
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Cricket: An Overview
Cricket originated in England during the 16th century and has since spread its popularity all
over the world. It is the second most popular sport globally, only behind football . Cricket is
mainly played by the British Commonwealth nations including UK, Australia, New Zealand,
South Africa and West Indies. In the Indian subcontinent, cricket is more than a game; it is a
religion for the fans in India, Pakistan, Sri Lanka and Bangladesh. Unlike other sports, Cricket
does not have rules that players follow, it has laws. These laws were formulated over 250 years
ago by the Marylebone Cricket Club (MCC), and since then the MCC has been the sole
authority overlooking the laws (Marylebone Cricket Club, 2008). The MCC is only concerned
with the laws of cricket; the International Cricket Council (ICC) is the international governing body of Cricket and is responsible for organising all international cricket tournaments,
including the Cricket World Cup.
Currently there are three main forms of international cricket being played around the world that
have been approved by the ICC and include Test Cricket, One Day Cricket and Twent20
Cricket.. Test Cricket is played over five days and is considered the traditional form of the
game. Test cricket is still very popular among the traditionalists and the diehard cricket fans.
In the 1970s a shorter version of the game came into existence, which can be completed in one
day and is therefore called One Day Cricket. Initially the One Day Cricket format was rebuked
by majority of the cricketing world, but since this format was fast paced, exciting and a result
was guaranteed unlike test cricket (where a match can end with a draw after five days), the
crowds were attracted towards it. This format was further made popular by Kerry Packer, an
Australian media tycoon and owner of the Nine Television Network in Australia. Since the
acceptance of the One Day Cricket format, the ICC has organised a Cricket World Cup, which
is played every four years. Before One Day cricket, the ICC could not organise a Cricket World
Cup based on Test Cricket as it took five days to finish a game and a result was not always
certain.
The England and Wales Cricket Board (ECB), faced with decreasing spectators, decided to
shorten the One Day version of cricket to get it in line with other sports such as football. As a
result in 2003, the ECB introduced Twenty20 cricket. This is quicker and more exciting than
Test cricket and One day cricket because it is a three hour game played with the traditional
team size of 11 players; it offers more and faster action in less time. This version was an instant
hit with the spectators and the crowds returned to the stadiums. Spotting the commercial
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Potential behind Twenty20 cricket, the ICC decided to organise a Twenty20 World Cup in
2007. It was an immediate success among the audience with the viewership of the finals at
around 1 billion people, making it one of the most highly watched events in the world.
SETTING UP OF STUCTURE
There are numerous decisions that have to be taken in order to setup a sports league because the
choice of league format will affect the demand for the sport.Organisation of leagues is
interesting because the incentive effect of league rules is subtle and not properly understood by
fans journalists and sometimes team owners. Another reason is that the most prestigious
professional leagues which are called major, premier or first-division leagues are almost
always monopolies. Hence leagues have an incentive to structure leagues in such a way that
they reduce horizontal competition between them for inputs (players) and outputs (competitive
games).
Following types of decision are required to setup a league:
Format
How does the league schedule the contests that determine the eventual champion? Do they
go with Round robin or elimination tournament?
Hierarchy
What is the relationship between leagues of different qualities (English Premier League and
the Championship League)?
Multiplicity
How many leagues can exist at the same horizontal level of the sport?
Membership
What are the terms and conditions of when and how a team can enter and exit the league?
Governance
How can the league implement its policies and rules?
The structure to follow while setting up a league. To produce a product which is commercially
attractive to the media, sponsors and fans a league should has to decide on the following
factors:
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Membership in the professional sports league:
This includes number and location of teams in a league, transfer of team ownership or
location and the financial and legal requirements for team ownership.
Governance of the professional sports league:
Covers the constitution, bylaws, voting and commissioner of the league.
Production of the product of the league:
Includes the rules for the competition, determining the method for league champion and
where and when to schedule the games.
Marketing of the products:
Covers the sale of broadcasting rights, intellectual property rights and the arrangement of
sharing revenues among member clubs.
Players of the member teams:
Includes the eligibility, drafting, transfers, compensation and collective bargaining of players.
Other inputs to the production of the joint venture:
Covers stadium standards, construction, financing and rules applicable to team executives.
Generally there are two organisational forms for professional sports leagues joint ventures
and single entities. Under joint ventures, teams are owned by separate economic entities and
come together to form a league. While a single entity leagues is where teams are owned by a
single economic entity which is the league itself. There are two possible from of organisational
forms for leagues.With regards to joint ventures Member teams are independently owned and
managed, and collectively create the league as a joint venture for coordinating their league
activities.Further adding with regards to single entities in these leagues, teams are not
independent organisations, but are operating divisions of the league.
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Cost Factors
There are two cost elements associated with sports leagues:
Fixed costs include interest or rent on the capital for the stadium and also include the
cost of equipment and transportation.
Quasi-rent for the players because the team pays for the unreproducible talent of the
player.
The long run average cost curve is horizontal but average cost can rise due to increase in
production which will result in hiring of less efficient inputs (players), but this increase in costswould negated the enthusiasm effect. He goes on to explain that the enthusiasm effect is when
the scale of the sport increases, public interest or enthusiasm will give confidence to more
individuals to take up playing the sport. This will increase the supply of players to all the levels
of the sport, including the professional level in the long run. The enthusiasm effect suggests
that demand and supply are interrelated because if higher the number of people who play a
sport (supply), higher will be the interest of people to watch the match at the stadium (demand)
or on television (demand).If there are two rival leagues in the same sport, it would lead to
higher player bargaining power regarding their wages because team would not have the
monopoly power when buying playing services. When there is only one league, players have to
negotiate directly with the teams because usually there is some kind of restriction on member
teams bidding for the same player. But there can be no restriction if teams from different
leagues bid for the same players, which will naturally raise the player wages (increase costs for
teams).
Demand Factors
There are a number of utilities created by sports teams. For example, utility for spectators
who go to the stadium to watch the match and also for people following the game on television.
There is indirect utility created for people who follow the league tables.
Naturally, closer the competition and league standings higher will be the indirect effect. For
media companies like televisions and newspapers the indirect utility is a source of income and
indirect effect helps sell the utility. The degree of indirect effect is directly related to the scale
and far reaching the league is among the public.
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When it comes to the efficiency of leagues when competing against each other. The monopoly
leagues benefit from utilising their market power in both the input (cost) and output (demand)
markets. Citing the example of sporting leagues in both the US and UK market the leagues
take advantage of collective bargaining power to benefit while selling the national broadcast
rights. Monopoly leagues can also enforce restriction on member teams with regards to
competition for players. By restricting membership to a league, the value of the existing
franchises can be enhanced.
Some quantifiable objectives for measuring utility....
Security:
Survival for existence could lead to clubs selling their players for monetary gains.
Attendance/ Television Viewership:
A full house would improve the atmosphere and create a sense of occasion. Higher
television viewership will lead to the club having more fans.
Playing success:
One of the most important factors for a football club and subscribed by all the
stakeholders including fans, directors, managers and players.
Profits:
Sloane states that profit is not the sole objective of a club, but it should still be
considered as a utility function.
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Indian Premier League Background
With the resounding success of the Twenty20 format, the Indian national team winning the
inaugural Twenty20 World Cup the BCCI launched the Indian Premier League in October 2007
to gain from marketing Twenty20 cricket in the largest cricket market in the world. Another
reason for the IPL launch was to counter the threat from the ICL which was started by Zee
Telefilms. The BCCI sold the televisions broadcast rights for the IPL for $1,016 million . There
had been attempts in the past to launch private leagues in India which were not successful due
to the fact that they were the efforts of single organisation deciding which teams or clubs could
participate in them.
The IPL initiative is different because it is the first league in India that has brought significant
external participation into its management. The idea is to have industry leaders, celebrities and
35 companies to bid for city franchises that would compete against each other in the Twenty20
format .
The concept of the IPL is based on the franchise model of sports management and is similar to
the National Football League (NFL) in the USA. The IPL is a Twenty20 cricket tournament
formed by the BCCI and sanctioned by the ICC. In January 2008, the BCCI auctioned the eight
city franchises for a total of $723.5 million . The franchises will own rights for the city based
teams for a 10 year period after which they would have to renew them with BCCI. Currently,
each team plays the other twice, home and away, which means a minimum of seven home
games per season for every franchise. As all the franchises are guaranteed to play the full
league season, there is low marketing risk associated with early elimination from the
tournament. Once the franchises were decided all the leading international players were up for
auction to be part of the franchises teams. One of the main reasons being attributed to the
success of the IPL is the participation of the top international players . To ensure that they have
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competitive teams, all the eight franchises have spent huge sums of money to acquire the best
talent available around the world. The franchises spent between $6.6 million and $3.6 million
on players .
In April 2008 the first IPL tournament was held over 44 days which provided non-stop
entertainment, excitement and fast paced cricket. Various sources have said that the IPL was a
resounding success, with Arnab Mitra of India Infoline saying Over 200 million Indian
viewers, 10 million international viewers, 4 million live spectators: the Indian Premier League
(IPL) is a sports and entertainment revolution in the making, surpassing all records of
viewership on ground and on media. Advertising revenue and ticket sales have exceeded all
expectations, making IPL highly profitable for the organisers, broadcasters and successful team
owners.
The IPL has been a success with the audience because of the following aspects:
Prime Time:
To get the highest number of audience for all the games, the IPL matches will be played at
night; this will give the working public to watch the game after work. The evening time is also
the peak viewership time in India.
Duration and entertainment:
The shorter duration of the game combined with entertainment (music, cheerleaders, etc) draws
from a larger audience base because even the non-cricke t fans are attracted to the league.
Appearance:
To make the league appealing to the audience, the BCCI has contracted the leading domestic
and international cricketers to play in the IPL.
The strong viewership numbers combined with excitement created by the IPL proves that the
first season was a resounding success. To put the IPL success into perspective according to
research the Indian governments sports budget is $122 million while the overall revenues
(Franchises, Broadcasters, BCCI) of the IPL for the year are $300 million. All this excitement
combined with fast paced cricket and entertainment has lead to a huge audience for the IPL,which is a dream for any marketing team. The television viewership for the IPL has been the
highest among all programmes in India, with an average TRP of 7 .
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First season
A Chennai vs Kolkata match in progress at the M.A. Chidambaram Cricket Stadium
The inaugural season of the tournament started on 18 April 2008 and lasted for 46 days with 59
matches scheduled, out of which 58 took place and 1 was washed out due to rain. The final was
played in DY Patil Stadium,Nerul, Navi Mumbai. Every team played each other both at home
and away in a round robin system. The top four ranking sides progressed to the knockout stage
of semi-finals followed by a final. Rajasthan Royals defeated Chennai Super Kings in a last ball
thriller and emerged as the inaugural IPL champions...
Second season
2009 Indian Premier League
The 2009 season coincided with the general elections in India. Owing to concerns regarding
players' security, the venue was shifted to South Africa. The format of the tournament remained
same as the inaugural one. Deccan Chargers, who finished last in the first season,were big
underdogs, but came out as eventual winners defeating the Royal Challengers Bangalore in the
final.
Third season
The third season opened in January 2010 with the auction for players. 66 players were on offer
but only 11 players were sold. In this season, Deccan Chargers did not play at their preferred
home location of Hyderabad, India due to the ongoing political crisis in the Telangana region .The new bases for the champions this season were Nagpur, Navi Mumbai and Cuttack. Four
teams qualified for the semi-finals. The first semi-final was won by Mumbai Indians who
defeated Bangalore Royal Challengers by 35 runs. Chennai Super Kings defeated Deccan
Chargers in the second semi-final. The final was played between Chennai Super Kings and
Mumbai Indians. Chennai Super Kings won by a margin of 22 runs.
Fourth season
2011 Indian Premier League
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On 21 March 2010, it was announced in Chennai that two new teams from Pune and Kochi will
be added to the IPL for the fourth season. However, the bid around the Kochi franchisee turned
controversial resulting in the resignation of minister, Shashi Tharoor from the Central
Government and investigations by various departments of the Government of India into the
financial dealings of IPL and the other existing franchisees. Later, Lalit Modi was also removed
from IPL chairmanship by BCCI. On 5 December 2010, it was confirmed that Kochi will take
part in the fourth season of IPL.
The addition of teams representing Pune and Kochi was to have increased the number of
franchises from 8 to 10. The BCCI originally considered extending the tournament format used
in previous season to ten teams, which would increase the number of matches from 60 to 94.Instead, the round-robin stage of the tournament was to have been replaced by a group stage
with two groups of five, limiting the number of matches to 74.
In October 2010, the Rajasthan Royals and Kings XI Punjab had their franchises terminated for
breaching ownership rules. The new Kochi franchise was also issued a warning to resolve all
their ownership disputes. Two months later both teams were given the go-ahead to take part in
the 2011 edition after a court ruling.
MARKET STRUCTURE
The Indian Premier League: is based on the joint venture ownership style. The League, run by
the Board of Control for Cricket in India (BCCI), auctioned rights to 8 franchises for a 10 year
period. The 8 teams play each other in the round robin format to determine the champion
for the season. The IPL has set a cap on the number of teams that can participate in the league.
For the first three years only 8 teams will be allowed to compete in the league after which the
IPL can decide to auction more teams to be added to the league.
To Find Out The Success Of League, These Things Are Taken Into Consideration:
Money invested / generated by the league: Success of any business venture eventually
depends on the money generated by it.
Number of players participating in the league: Superstar players are the most important
draw to a league for the public, if the league employs more players it will lead to the league
have higher number of superstars.
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Television viewership of the league: The television revenues are the most important source
of income for any league and media companies bid for television rights based on audience
viewership. Higher the number of viewers, higher the ad revenues for the media company.
Money invested / generated:
The BCCI did not have to invest a considerable amount of money to launch the IPL which is
clear from the article titled Jiminy Cricket India's cricket board makes a cool billion dollars for
doing not much. Since the IPL is only an administrator that sets the rules and runs the league, it
did not require substantial investments. The franchise owners are responsible for marketing the
league, paying player wages, investing in stadiums and infrastructure. According to Lalit Modi,
IPL Chairman & Commissioner, To date we (the Indian Premier League) have made $1.75
billion (Modi, Indian Premier League rakes in millions from franchise sale, 2008). Alchemy in
its report also stated that the IPL is already a $2 billion property. Arnab Mitra of IIFL says
between organisers, broadcasters and franchises, that the IPL will bring approximately
$30 million a year into cricket. To put this in perspective, the Indian government had a total
sports budget of $11.3 million . The structure of the IPL is slightly different from the other
professional sporting leagues across the world where various existing teams come
together and form a league. The teams have their Directors on the Board of the league. But in
the IPL, first the league was formed and then the rights to the franchises were auctioned. The
franchises do not have any Directors on the IPL Board. There could be concerns among the
franchises about working with each other as they have no representation on the IPL Board. In
his interview with Cricinfo, Lalit Modi, IPL Chairman and Commissioner address this fact by
stating There is no need for concern. We need to work with them. It's with their success we
will achieve ours. It's not us against them. We are all on the same side. We will ensure we work
with our partners and that's what my job is (Modi, IPL will revolutionise the game, 2008).
The IPL is a joint venture league as it has sold the rights to run teams to various franchises.
Arnab Mitra of India Infoline states that the IPL franchises will earn annual revenues from
the following sources:
Television Broadcasting and IPL Sponsorship fee - $95 million
Team Sponsors - $38 million
In-stadia advertisers - $19 million
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Ticket Sales - $40 million
Merchandise - NA
Events NA
He further adds the annual revenue stream for the IPL:
Central Sponsors - $30 million
Television Broadcasting fees - $100 million
Franchises fees - $71 million
Number of players:
According to the IPL website, the league has 8 teams with the league currently has 191
players participating in the league, an average of 24 players per team (Indian Premier
League, 2008). Like the ICL, the IPL teams are city based and include the
Bangalore Royal Challengers, Chennai Super Kings, Delhi Daredevils, Deccan Chargers
(Hyderabad), Kings XI Punjab, Kolkata Knight Riders, Mumbai Indians and Rajasthan
Royals.
According to the Television Audience Measurement (TAM) service in India, the average
viewership for the IPL was at 6.28 with the IPL finals achieving a rating of 9.8, which is the
highest rating ever for domestic cricket in India (TAM Media Research, 2008). This is
where we can see the real success of the IPL. According to Alchemy Research, the IPL
surpassed expectations of media professionals and the ratings were 30-50% more than
expected (Alchemy, 2008). Also the television broadcaster for the IPL increase its ad rates
for spot sales from $5,000 - $6,250 for 10 seconds to $7,500 - $8,750 for
10 seconds. For the semi finals and finals the ad rates were sold for $17,500 - $25,000
for 10 seconds. Not to mention the TRPs (TAM ratings) that we have garnered in India
are quite frankly staggering.
And all this because we have had some of the best cricketing entertainment provided by the
best cricketers from around the world
EFFECT OF LEAGUE
On the IPL franchises:
1. The IPL franchises would be able to choose from the full talent pool which would
lead the IPL franchises to assembling the best possible teams.
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2. Best possible teams will result in high quality of sporting competition between
franchises leading to higher demand for the sport.
3. There would be no competition for players therefore they would have no bargaining
power over the IPL franchises. This would keep the wage rate in line with player talent
4. Will have access to the entire population to include in its fan base as there would be no
competition from rival leagues
5. Will not have to lower ticket prices to attract spectators. Also the IPL will not have to
reduce its fee for television broadcast rights to attract media companies. Demand from
both, the fans and the media companies will depend on the quality of competition on
field.
On the fans:
The quality of competition the spectators watch will be the best quality available
because the franchises will be able to choose from all the players possible and all the best
players would be playing in the same league.
The fans desire to see one champion at the end of the season will also be fulfilled as the
IPL winner will be the champion for the year.
The fans could face higher ticket prices as there would be no competition for the IPL
Effects of league on the BCCI:
1. The BCCI would be able to choose players from the full talent pool available,
which would lead to the best team selected for international cricket leading to a higher
quality of cricket.
2. Higher quality of cricket would lead to increase in demand for cricket and result in higher
revenues from sale of television broadcast rights working with each other as they have no
representation on the IPL Board. In his interview with Cricinfo, Lalit Modi, IPL
Chairman and Commissioner address this fact by stating There is no need for concern. We
need to work with them. It's with their success we will achieve ours. It's not us against them.
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We are all on the same side. We will ensure we work with our partners and that's what my
job is . The IPL is a joint venture league as it has sold the rights to run teams to various
franchises.
Arnab Mitra of India Infoline states that the IPL franchises will earn annual revenues from
the following sources:
Television Broadcasting and IPL Sponsorship fee - $95 million
Team Sponsors - $38 million
In-stadia advertisers - $19 million
Ticket Sales - $40 million
He further adds the annual revenue stream for the IPL:
Central Sponsors - $30 million
Television Broadcasting fees - $100 million
Franchises fees - $71 million
Number of players:
According to the IPL website, the league has 8 teams with the league currently has 191 players
participating in the league, an average of 24 players per team (Indian Premier League,
2008). Like the ICL, the IPL teams are city based and include the Bangalore Royal
Challengers, Chennai Super Kings, Delhi Daredevils, Deccan Chargers (Hyderabad), Kings XI
Punjab, Kolkata Knight Riders, Mumbai Indians and Rajasthan Royals. Again similar to the
ICL the IPL wants to gain popularity by promoting its franchises as part of the local
community.My team, my city is our final objective. If we able to build on that over the next
few years we will have something that will revolutionise cricket - the way it's played, watched
or followed .
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According to the Television Audience Measurement (TAM) service in India, the average viewership
for the IPL was at 6.28 with the IPL finals achieving a rating of 9.8, which is the highest rating ever
for domestic cricket in India (TAM Media Research, 2008). This is where we can see the real success
of the IPL. According to Alchemy Research, the IPL surpassed expectations of media professionals
and the ratings were 30-50% more than expected (Alchemy, 2008). Also the television broadcaster
for the IPL increase its ad rates for spot sales from $5,000 - $6,250 for 10 seconds to $7,500 - $8,750
for se we have had some of the best cricketing entertainment provided by the best cricketers from
around the world (Modi, Q&A, 2008).
.League organization
Franchises
The winning bidders for the eight franchises were announced on 24 January 2008. While the total base
price for auction was US $400 million, the auction fetched US $723.59 million
On 21 March 2011Pune and Kochi were unveiled as the two new franchises for the fourth edition of
the Indian Premier League. The base price was $225 million. While Pune was bought by Sahara
Adventure Sports Group for $370 million, the Kochi franchise was bought by Rendezvous Sports
World Limited for $333.3 million. The process was to have been completed on March 7 but was
postponed by two weeks after many bidders and the BCCI objected to stiff financial clauses. The
second franchise auction fetched total $703 million
.
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IPL FRANCHISEES
Franchise City Inception Owner(s) Captain Coach
Mumbai Indians Mumbai 2008Mukesh Ambani
Sachin Tendulkar Robin Singh
Royal Challengers
BangaloreBangalore 2008
Vijay Mallya
(UB Group)Daniel Vettori Ray Jennings
Deccan Chargers Hyderabad 2008Deccan
Chronicle group
Kumar
SangakkaraDarren Lehmann
Chennai Super
KingsChennai 2008
India Cements
(N.Srinivasan)
Mahendra Singh
DhoniStephen Fleming
Delhi Daredevils New Delhi 2008 GMR Group Virendra Sehwag Greg Shipperd
Kings XI Punjab Chandigarh 2008
Ness
Wadia,Preity
Zinta, Dabur,
Apeejay
Surendera
Group
Adam Gilchrist Michael Bevan
Kolkata Knight
RidersKolkata 2008
Red Chillies
Entertainment
(Shah Rukh
Khan)
Gautam GambhirDav Whatmore
Rajasthan Royals Jaipur 2008
Emerging Media
(Lachlan
Murdoch),
Shilpa Shetty
Raj Kundra
Shane Warne Shane Warne
Pune Warriors India Pune 2011 Sahara Yuvraj Singh Geoff Marsh
Kochi Tuskers
Kerala
Kochi 2011 Kochi Cricket
Private Limited
Mahela
JayawardaneGeoff Lawson
Rules
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There are five ways that a franchise can acquire a player. In the annual auction, buying domestic
players, signing uncapped players, through trading and buying replacements. In the trading window the
player can only be traded with his consent. The franchise will have to pay the difference between the old
contract price and the new contract price. If the new contract is worth more than the older one then the
difference will be shared between the player and the franchise selling the player.
Some of the Team composition rules are:
Minimum squad strength of 16 players plus one physio and a coach.
No more than 10 foreign players in the squad and at most 4 in the playing XI.
As this is domestic cricket so minimum of 8 local players must be included in each squad.
A minimum of 2 players from the BCCI under-22 pool in each squad.
Some of the differences to international Twenty20 cricket:
A difference to international cricket is a timeout. It gives the players an opportunity to strategise and
take a drink during the strict 2 minutes, 30 seconds time limit. Each team is awarded two timeouts per
innings totalling to four timeouts for the whole game. The teams can take the timeout when instructed,
but is necessary to take it at the end of 9th and 16th over.
IPL is also known for having commercials during the game, hence there is no time limit for teams to
complete their innings. However, there may be a penalty if the umpires find teams misusing this
privilege at their own choice.
The total spending cap for a franchisee in the first player auction was US $5 million. Under-22 players
are to be remunerated with a minimum annual salary of US $20,000 while for others it is US $50,000.
The most expensive players in the IPL to date is Gautam Gambhir of India fetched the highest price of
$2.4 million from Kolkata Knight Riders at the auction for season 4
Player signings
The first players' auctions were held on 2008. The IPL placed icon status on a select few marquee Indian
players. These players were Rahul Dravid, Sachin Tendulkar, Saurav Ganguly, Yuvraj Singh and VVS
Laxman initially named an icon player, later voluntarily opted out of his icon status to give his team
(Deccan Chargers) more money to bid for players. For the second season, auctions were also held, but
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free signings taking place in the off-season by franchises led to calls for a draft-like system where the
lowest ranked teams would be given a first opportunity to sign players.
Television rights and sponsorships
The IPL is predicted to bring the BCCI income of approximately US$1.6 billion, over a1 period of five
to ten years. All of these revenues are directed to a central pool, 40% of which will go to IPL itself, 54%
to franchisees and 6% as prize money. The money will be distributed in these proportions until 2017,
after which the share of IPL will be 50%, franchisees 45% and prize money 5%. The IPL signed up
Kingfisher Airlines as the official umpire partner for the series in a 106 crore (US$23.53 million)
(approximately 15 million) deal. This deal sees the Kingfisher Airlines brand on all umpires' uniforms
and also on the giant screens during third umpire decisions.
Television rights
On 15 January 2008 it was announced that a consortium consisting of India's Sony Entertainment
Television network and Singapore-based World Sport Group secured the global broadcasting rights of
the Indian Premier League The record deal has a duration of ten years at a cost of US $1.026 billion. As
part of the deal, the consortium will pay the BCCI US $918 million for the television broadcast rights
and US $108 million for the promotion of the tournament. This deal was challenged in the Bombay
High Court by IPL, and got the ruling on its side. After losing the battle in court, Sony Entertainment
Television signed a new contract with BCCI with Sony Entertainment Television paying 8,700 crore
(US$1.93 billion) for 10 years. One of the reasons for payment of this huge amount is seen as the money
required to subsidize IPL's move to South Africa which will be substantially more than the previous
IPL. IPL had agreed to subsidize the difference in operating cost between India and South Africa as it
decided to move to the African nation after the security concerns raised because of its coincidence with
India's general elections.
20% of these proceeds would go to IPL, 8% as prize money and 72% would be distributed to the
franchisees. The money would be distributed in these proportions until 2012, after which the IPL would
go public and list its shares (But recently in March 2010, IPL decided not to go public).
Sony-WSG then re-sold parts of the broadcasting rights geographically to other companies. Below is a
summary of the broadcasting rights around the world.
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On 4 March 2010 ITV announced it had secured the United Kingdom television rights for the 2010
Indian Premier League. ITV will televise 59 of the 60 IPL matches on its ITV4 free to air channel.
On April 1, 2011, Rogers Sportsnet announced that it signed a four year exclusive deal in Canada to
broadcast 36 group stage matches, 3 playoff matches and 1 championship match on Rogers Sportsnet
One.
Winning Bidder Regional Broadcast Rights Terms of Deal
Sony/World Sport
Group India
10 years, 2008-2017 at
8,700 crore (US$1.93
billion) (revised)
GEO Super Pakistan Terms not released.
ONE HD (2009
2010) Network
Ten (2008)
Australia: Free-to-air HD and SD
television.Owned by Network TEN.
5 years, 20082012 at
A$10-15 million
Sky Network
Television (2008
2010)
New Zealand Terms not released.
PCCW Hong Kong: Broadcast rights on Now TV.2 years, 2010-2011 terms
not released.
StarHubSingapore: Broadcast rights on Cricket
Extra.Terms not released
Astro Malaysia Terms not released.
SuperSport
Angola,Benin, Botswana
Terms not released.
Sponsorships
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India's biggest property developer DLF Group paid US$50 million to be the title sponsor of the
tournament for 3 years from 2008 to 2010.
Other year sponsorship agreements include a deal with motorcycle maker Hero Honda worth $22.5-
million, one with PepsiCo worth $12.5-million, and a deal with beer and airline conglomerate
Kingfisher at $26.5-million.
Revenue and Profits
The UK-based brand consultancy, Brand Finance, has valued the IPL at $4.13 billion (Rs 18,998
crore) in 2010 It was valued at U$2.01 billion in 2009 by the same consultancy.
There are disputed figures for the profitability of the teams. One analyst said that four teams out of the
eight made a profit in 2009. While the London Times said that all but Kings XI Punjab made a profit.
In 2010, the IPL expects to have 80 official merchandising deals. It has signed a deal with Swiss
watchmaker Bandelier to make official watches for the IPL
According to a recent study by a UK-based brand valuation consultancy, the brand value of the IPL
has more than doubled to USD 4.13 billion (over 18 crore (US$4 million)) from USD 2.01 billion in
2009.
The franchises have been a part of this growth. Chennai Super Kings, who were ranked fourth last
year, has emerged the most valued franchise in 2010. The CSK franchise has moved up the ladder to
number one with a valuation of USD 48.4 million. The Kolkata Knight Riders co-owned by
Bollywood actor Shah Rukh Khan comes in second with a valuation of USD 46 million and the
Rajasthan Royals, co-owned by Bollywood actress Shilpa Shetty comes in third with USD 45.2
million. The Royal Challengers Bangalore, owned by Vijay Mallya, is ranked fourth with a valuation
of USD 41.9 million and is followed by the Mumbai Indians (USD 40.8 million), Delhi Daredevils
(USD 40.5 million) and Kings XI Punjab ( USD 36.1 million). The Deccan Chargers are at the basewith a valuation of USD 34.4 million.
Rank Franchise Brand Value
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1 Chennai Super Kings $ 48.4 m
2 Kolkata Knight Riders $ 46 m
3 Rajasthan Royals $ 45.2 m
4 Royal Challengers Bangalore $ 41.9 m
5 Mumbai Indians $ 40.8 m
6 Delhi Daredevils $ 40.5 m
7 Kings XI Punjab $ 36.1 m
8 Deccan Chargers $ 34.4 m
Mobile applications
DCI Mobile Studios (A division of Dot Com Infoway Limited), in conjunction with Sigma Ventures
ofSingapore, have jointly acquired the rights to be the exclusive Mobile Application partner and
rights holder for the Indian Premier League cricket matches worldwide for the next 8 years (including
the 2017 season). Recently, they have released the IPL T20 Mobile applications foriPhone,Nokia
SmartphonesandBlackberry devices. Soon it will be made available across all other major Mobileplatforms including theAndroid,Windows Mobile,Palm & others.
Official website
The IPL negotiated acontract with the Canadiancompany Live Current Media Inc. to run and
operate its portals and the minimum guarantee has been negotiated at US $50 million over the next
10 years. The official website of the tournament is www.iplt20.com.
Incorporating popular forms of social media into the third season of the IPL, the website now
contains a more holistic presence across all online mediums. The website apart from featuring new
additions to empower user interaction, has encouraged a wider range of websites around IPL like IPL
Tracker and IPL Mag amongst other more traditional reporting websites.
Global following
The third season of the IPL saw interest rise dramatically in the United Kingdom, due in part to
telecasts being moved from the subscription-basedSetanta Sports to the free-to-air ITV4. James
Macleod stated, "We are delighted with the viewing figures for the IPL so far. The ratings for ITV4s
coverage have been around seven or eight times those achieved by Setanta last year, and we're
delighted to be bringing the competition to a wider audience". Lalit Modi, Chairman and
Commissioner of IPL, also expressed immense satisfaction on the way IPL has been accepted by the
British audience. "ITV beats Sky Sports over the weekend in number of viewers. This is great going.
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The ITV numbers are double that of rugby league. This is huge by all imaginations. UK figures for
viewership on ITV already 10 times that of last year.
What explains IPLs success?
Shorter duration: The 3-hour duration of a T20 match suits working Indians who cannot spare a full
day for a cricket match.
Prime time: The matches are played during prime time (2000 hrs to 2300 hrs) on weekdays, and in
the evenings at weekends. This is the time for peak viewership in India and also allows working
people to attend matches in stadiums.
International players: Several top international players have joined IPL teams. Their high salaries
are a strong incentive to perform.
Celebrity endorsement: Big names from the entertainment and corporate world own franchisesor are attached to teams.
Cricket as an entertainment package: Cheerleaders, music at the stadium, etc, make the package
highly entertaining even for less-,than-avid cricket fans.
Opportunities for the future
1. More involvement of players from England and Australia in the next edition will add to the
excitement.
2. Increasing the limit on the maximum number of overseas players in every team should further raise
the tournaments standard.
3. Marketing of the first edition was primarily India-centric; from the next edition onwards, better
international marketing should increase overseas viewership.
4. New IPL teams, sale or equity participation of existing teams, will add to the excitement.
5. Player trading will be allowed from the next year; this would add a new dimension to the tournament.
6. Better coordination with other countries cricket boards will ensure that other international
tournaments do not clash with IPL.
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Television advertisers(US$155m)
Central Sponsors(US$30m)
Merchandise
Team sponsors
(US$38m) Events
In-stadia advertisers (US$19m)
Sony-
WSG
(Broadcaster)
Broadcasting fees(US$100
m) BCCI(Organiser)
Franchises fees
(US$71m)
Ticket sales US ($40m)
Team
owners /
Franchises
Productioncost
The IPLrevenueflow(Annual)Inward arrows arerevenue inflows,while outward
arrows arerevenue outflows
Umpire salaries
(US$1.2m) Prize
money (US$5m)
Share of Broadcastingfees
IPL sponsorship(US$95m
)
Player salaries
(US$38m) Stadium
Leasing
Team advertising (US$24m)
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COMPARING WITH OTHER SPORTS LEAGUE
According to the inaugural Annual Review of Global Sports Salaries to be published later
this week by sportingintelligence.com, the second highest-paid league, based on first-
team salaries on a pro-rata basis, is our very own IPL.
Second only to the American National Basketball Association ( NBA) league, whose
annual average salary is 2.62 million pounds, the IPL's average salary, calculated over a
year, is 2.5 million pounds. It must be remembered that the league is only played over a
six-week period, making what cricketers earn for playing Twenty20 matches
astounding.
The third highest-paid is AmericanMajor League Baseball ( MLB), at 1.82 million
pounds while EPL comes in fourth, at 1.46 million pounds.
In the 211-team list currently monitored by average first-team pay, Royal
Challengers Bangalore comes in at 12th, at an average of 57,833 pounds a week, standing
two places above Manchester United.
According to a review of global sports salaries, and theIPL boasts of three teams within
the top-30 bracket.
The IPL has edged the English Premier League, who has two teams in the list
- Manchester Unitedand Chelsea. RCB is No. 12 (57,833 per week), and others on the
list are Kolkata Knight Riders (56,445) and Chennai Super Kings (55,526). At No. 1 is
the MLB's New York Yankees(89,897).
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ENGLISH PREMIER LEAGUE (EPL)
The Premier League is an English professional league forassociation football clubs. At the
top of the English football league system, it is the country's primary football competition.
Contested by 20 clubs, it operates on a system ofpromotion and relegation with The Football
League. The Premier League is a corporation in which the 20 member clubs act as
shareholders. Seasons run from August to May, with teams playing 38 matches each,
totalling 380 matches in the season. Most games are played on Saturdays and Sundays, with
a few games played during weekday evenings. It was known as the Premiership from 1993
to 2007. It is currently sponsored by Barclays Bank and therefore officially known as the
Barclays Premier League.
The competition formed as the FA Premier League on 20 February 1992 following the
decision of clubs in the Football League First Division to break away from The Football
League, which was originally founded in 1888, and take advantage of a lucrative television
rights deal. The Premier League has since become the world's most watched associationfootball league.[1] It is the world's most lucrative football league in terms of revenue, with
combined club revenues of over 2 billion in 200809.[2] It is ranked first in the Union of
European Football Associations (UEFA) coefficients of leagues based on performances in
European competitions over the last five years, ahead of Spain's La Liga and Germany's
Bundesliga.
Since 1888, a total of 23 clubs have been crowned champions of the English football system.
Of the 44 clubs to have competed since the inception of the Premier League in 1992, four
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have won the title: Manchester United (11 titles) Arsenal (3), Chelsea (3) Blackburn Rovers
(1). The current champions are Chelsea, who won the title in the 200910 season.
CORPORATE STRUCTURE
The Premier League is operated as a corporation and is owned by the 20 member clubs. Each
club is a shareholder, with one vote each on issues such as rule changes and contracts. The
clubs elect a chairman, chief executive, andboard of directors to oversee the daily operations
of the league.[15] The current chairman is Sir Dave Richards, who was appointed in April
1999, and the chief executive is Richard Scudamore, appointed in November 1999. The
former chairman and chief executive, John Quinton and Peter Leaver, were forced to resign
in March 1999 after awarding consultancy contracts to former Sky executives Sam Chisholm
and David Chance. The Football Association is not directly involved in the day-to-day
operations of the Premier League, but has veto power as a special shareholder during the
election of the chairman and chief executive and when new rules are adopted by the league.
The Premier League sends representatives to UEFA's European Club Association, the
number of clubs and the clubs themselves chosen according to UEFA coefficients. For the
201011 season the Premier League had 10 representatives in the Association. The European
Club Association is responsible for electing three members to UEFA's Club Competitions
Committee, which is involved in the operations of UEFA competitions such as the
Champions League and UEFA Europa Leagu
COMPTETION FORMAT
Competition
There are 20 clubs in the Premier League. During the course of a season (from August to
May) each club plays the others twice (a double round-robin system), once at their home
stadium and once at that of their opponents, for a total of 38 games. Teams receive three
points for a win and one point for a draw. No points are awarded for a loss. Teams are ranked
by total points, then goal difference, and then goals scored. At the end of each season, the
club with the most points is crowned champion. If points are equal, the goal difference and
then goals scored determine the winner. If still equal, teams are deemed to occupy the same
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position. If there is a tie for the championship, for relegation, or for qualification to other
competitions, a play-off match at a neutral venue decides rank. The three lowest placed teams
are relegated into the Football League Championship, and the top two teams from the
Championship, together with the winner ofplay-offs involving the third to sixth placed
Championship clubs, are promoted in their place.
Qualification for European competitions
As of the 200910 season qualification for the UEFA Champions League changes, the top
four teams in the Premier League qualify for the UEFA Champions League, with the top
three teams directly entering the group stage. Previously only the top two teams qualified
automatically. The fourth-placed team enters the Champions League at the play-off round fornon-champions and must win a two-legged knockout tie in order to enter the group stage.
The team placed fifth in the Premier League automatically qualifies for the UEFA Europa
League, and the sixth and seventh-placed teams can also qualify, depending on the winners
of the two domestic cup competitions. If one of the cup winners qualifies for Europe through
their league position, the sixth-placed team in the Premier League will qualify for the Europa
League. If both of the cup winners qualify for the Champions League through their league
position, the sixth and seventh-placed teams in the Premier League will qualify for the
Europa League. If either domestic cup competition is contested between teams outside the
top four league positions, the winner will automatically qualify for the UEFA Europa League
regardless of their final league position. A further place in the UEFA Europa League is also
available via the Fair Play initiative. If the Premier League has one of the three highest Fair
Play rankings in Europe, the highest ranked team in the Premier League Fair Play standings
which has not already qualified for Europe will automatically qualify for the UEFA Europa
League first qualifying round.
An exception to the usual European qualification system happened in 2005, afterLiverpool
won the Champions League the year before, but did not finish in a Champions League
qualification place in the Premier League that season. UEFA gave special dispensation for
Liverpool to enter the Champions League, giving England five qualifiers.[ UEFA
subsequently ruled that the defending champions qualify for the competition the following
year regardless of their domestic league placing. However, for those leagues with four
entrants in the Champions League, this means that if the Champions League winner falls
outside of its domestic league's top four, it will qualify at the expense of the fourth-placed
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team in the league. No association can have more than four entrants in the Champions
League.
In 2007, the Premier League became the highest ranking European League based on the
performances of English teams in European competitions over a five-year period. This broke
the eight-year dominance of the Spanish league, La Liga. The top three leagues in Europe are
currently allowed to enter four teams into the Champions League. Michel Platini, the UEFA
president, had proposed taking one place from the top three leagues and allocating it to that
nation's cup winners. This proposal was rejected in a vote at a UEFA Strategy Council
meeting. In the same meeting, however, it was agreed that the third-placed team in the top
four leagues would receive automatic qualification for the group stage, rather than entry into
the third qualifying round, while the fourth-placed team would enter the play-off round for
non-champions, guaranteeing an opponent from one of the top 15 leagues in Europe. This
was part of Platini's plan to increase the number of teams qualifying directly into the group
stage, while simultaneously increasing the number of teams from lower-ranked nations in the
group stage.
SPONSORSHIP
The Premier League has been sponsored since 1993. The sponsor has been able to determine
the league's sponsorship name. There have been three sponsors since the league's formation.
19932001: Carling (FA Carling Premiership)
20012004: Barclaycard (Barclaycard Premiership)
20042007: Barclays (Barclays Premiership)
2007present: Barclays (Barclays Premier League)
As well as sponsorship for the league itself, the Premier League has a number of official
partners and suppliers. The official ball supplier for the league isNike who have had the
contract since the 200001 season when they took over from Mitre.
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FINANCES
The Premier League has the highest revenue of any football league in the world, with total
club revenues of 2.326 billion in 200809, and is the second most profitable after theGerman Bundesliga. In 2010 the Premier League was awarded the Queen's Award for
Enterprise in the International Trade category by Her Majesty Queen Elizabeth II. The
Premier League was recognised for its outstanding contribution to international trade and the
value it brings to English football and the United Kingdom's broadcasting industry. The
Premier League's gross revenue is regularly the fourth highest of any sports league
worldwide, behind the annual revenues of the three most popular North American major
sports leagues (the National Football League, Major League Baseball and the National
Basketball Association), but ahead of theNational Hockey League.
In terms of world football, the Premier League clubs are some of the richest in the world.
Deloitte, who annually release figures on club revenues through its "Football Money
League", listed seven Premier League clubs in the top 20 for the 200809 season. No other
league has more than four clubs in this table. Premier League teams have dominated the list
for many years, and even topped the list for almost a decade until the 200405 season. After
the Premier League's new TV deal went into effect, the league-wide increase in revenues is
expected to increase the Premier League clubs' standing in the list, and there is a possibility
that a Premier League club will be top of the list
COMPARISON
While its too early to be comparing the EPL & IPL (EPL has been around since 1888 while
IPL is just 2 mini-seasons old), here are some interesting facts & numbers.Heres how Forbes values some of the top EPL teams currently (US$ Millions):
Manchester United $ 1800 m
Arsenal $ 1200 m
Liverpool $ 1050 m
Chelsea $ 764 m
http://en.wikipedia.org/wiki/Fu%C3%9Fball-Bundesligahttp://en.wikipedia.org/wiki/Queen's_Award_for_Enterprisehttp://en.wikipedia.org/wiki/Queen's_Award_for_Enterprisehttp://en.wikipedia.org/wiki/Elizabeth_II_of_the_United_Kingdomhttp://en.wikipedia.org/wiki/United_Kingdomhttp://en.wikipedia.org/wiki/Major_professional_sports_leagues_in_the_United_States_and_Canadahttp://en.wikipedia.org/wiki/Major_professional_sports_leagues_in_the_United_States_and_Canadahttp://en.wikipedia.org/wiki/National_Football_Leaguehttp://en.wikipedia.org/wiki/Major_League_Baseballhttp://en.wikipedia.org/wiki/National_Basketball_Associationhttp://en.wikipedia.org/wiki/National_Basketball_Associationhttp://en.wikipedia.org/wiki/National_Hockey_Leaguehttp://en.wikipedia.org/wiki/Deloitte_Football_Money_Leaguehttp://en.wikipedia.org/wiki/Deloitte_Football_Money_Leaguehttp://en.wikipedia.org/wiki/Fu%C3%9Fball-Bundesligahttp://en.wikipedia.org/wiki/Queen's_Award_for_Enterprisehttp://en.wikipedia.org/wiki/Queen's_Award_for_Enterprisehttp://en.wikipedia.org/wiki/Elizabeth_II_of_the_United_Kingdomhttp://en.wikipedia.org/wiki/United_Kingdomhttp://en.wikipedia.org/wiki/Major_professional_sports_leagues_in_the_United_States_and_Canadahttp://en.wikipedia.org/wiki/Major_professional_sports_leagues_in_the_United_States_and_Canadahttp://en.wikipedia.org/wiki/National_Football_Leaguehttp://en.wikipedia.org/wiki/Major_League_Baseballhttp://en.wikipedia.org/wiki/National_Basketball_Associationhttp://en.wikipedia.org/wiki/National_Basketball_Associationhttp://en.wikipedia.org/wiki/National_Hockey_Leaguehttp://en.wikipedia.org/wiki/Deloitte_Football_Money_Leaguehttp://en.wikipedia.org/wiki/Deloitte_Football_Money_League8/6/2019 Ipl Final Prjct
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While, just the brand valuations of the current IPL franchises looks as follows (US$
Millions):
Kolkata Knight Riders 42.1
Mumbai Indians 41.6
Rajasthan Royals 39.5
Chennai Super Kings 39.4
Delhi Daredevils 39.2
Royal Challengers Bangalore 37.4
Kings XI Punjab 36.3
Deccan Chargers 34.8
Of course, as seasons go on, these valuations will rise, and there will be more teams more
global players and so on. Some of the key statistics to look at will be:
EPL IPL
Viewership 600 million homes (202 countries) 21 million per game (15 countries)
Revenue 2 Billion Pounds 11,000 crore Rs
Teams 20 8
With news that the two new franchise owners of the Pune and Kochi India Premier League
(IPL) cricket teams acquired the rights to the teams for US$370 million and US$320 million,
respectively, the time is right to look at India as an advertising market and examine its
inherent wealth.
To put the two deals into perspective, the IPL was formed three years ago and is currently
comprised of eight regional teams from Mumbai, Bangalore, Hyderabad, Chennai, Delhi,
Kolkata, Rajasthan and Punjab. When the league was first set up and teams were established,
the Rajasthan franchise cost the least at US$57 million, while the Mumbai franchise cost the
most at US$100 million.
Rajasthan won the first IPL series, which was watched by over 88 million Indians and
attracted TV advertising revenues nearing US$65 million. The 2009 series attracted an
average audience of 22 million each day, meaning the TV audience multiplied by a factor of
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six in 12 months, while TV ad revenues doubled. That series was won by the Deccan
Chargers.
The 2010 series, which is currently underway, is expected to generate record revenues and
has seen every match packed to capacity. Clearly, the concept of the IPL has taken off and
has become entrenched as a valuable national asset. Its also one that is increasingly
attracting huge sums of investment. To compare with the Pune and Kochi teams, take a look
at the English Premiership clubs acquired in recent years:
Chelsea (2003 takeover): US$190 million
Manchester United (2005 takeover): US$1.4 billion
Liverpool (2007 takeover): US$340 million
Manchester City (2008 takeover): US$300 million
It should be recognized that when buying into the English Premiership clubs, the owners
acquired existing brands with tangible value, as well as an established cash flow and fan
base. The investors in the IPL and especially the new teams of Pune and Kochin have had
to develop their own brand identity, build up a supporter base, and acquire rights to use (and
in many case redevelop) entire stadiums.
Its also worth considering that neither of the new Pune or Kochin teams actually exist at
present except as a franchise concept. There is not even a website for either of them. Building
up those two brands is going to be fascinating to watch since they will be taking part in a
little less than 12 months from now.
Clearly, the IPL has become a massive money-making exercise capable of reaching out to
Indians on a truly national basis. As a means to effectively and efficiently reach out to all
middle class Indians, the IPL is delivering an audience that no other platform has been able
to reach before. Looking forward, it seems likely the IPL will further expand. Bids are being
considered from the 2012 season, possibly bringing in an additional two teams from Nagpur,
Ahmadabad, Kanpur, Dharamshala, Indore, Cuttack, Gwalior and Visakhapatnam. Lucknow
and Goa have also been mentioned as wanting to be represented. Its also attracting
investment from overseas with Britains premiere cricket club, the MCC, having been on
fact-finding missions. The IPL itself is also slated to launch on the Bombay Stock Exchange
within the next two years.
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While massively popular in India, it remains to be seen if it can be exported and developed
overseas in the same manner the English Premiership has. It may well do so, at least in Asia.
Games are more exciting, and the 20-20 format means results are often not known until late
in the game thus leading to dramatic finales. The English Premierships hold on global sports
coverage may be under some threat here or lifestyles may change. In packed bars on
weekends in India, both the IPL and Premiership games are screened live and
simultaneously, but it is the cricket that gets the commentary. With the amount of value
coming into the IPL, it will continue to play an active role in where advertising dollars are
spent in India and how multinational organizations reach out to the domestic market.
Criteria/League IPL EPL
Year of Formation 2008 1992
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Season April-May August-May
No. of Franchises 8 20 (over 40 leagues haveplayed)
No. of Matches 59 380
Location of games Night matches on Home andaway basis
Home and away basis
Revenue Yet To Be Seen 3.7 Billion $ (2007-2008) byall clubs.
TV rights (including overseasrights)
~$1 Billion for 10 yrs bySony (addition $10-15 million
by Network Ten)
45 million a year from2007 to 2010
Prize Money 5 million $ 10 million
Governed By IPL council operated and jointly owned
by the 20 member clubs.
Record Attendance for sportsevent
13,094,307 (Average: 34,459)2006-2007 EPL
425,622 (Average: 30,401)2006-07 CommonwealthBank Series
Some of the things which separate these money making glamorous leagues are:
Player valuations:
The costliest player purchases in the IPL so far have been worth $1.55 million this
would be the cost at which 2nd and 3rd division teams exchange players in the EPL
system. Indeed, transfers remain one of the most pivotal news makers in the club soccer
world. This trend should catch up in the IPL which is currently living in a mini-license
raj world of its own. A bidding war for Dhoni is likely to be as spicy as a war for Ronaldo
once capitalism takes over.
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The 6+5 or 7+4 debate: While the EPL is furiously debating Platinis
suggestions after 100+ years of existence, the IPL has started on the reverse note. India is
definitely gaining with more T20 breakthrough players, but are we killing the next
generation of Test players? Probably yes, but given that Test cricket is going to soon
become a thing of the past anyway it should be ok. Though this system would probably
rob EPL of a lot of its glamour, it might help The Three Lions to a great extent. Do EPL
viewers in the 202 countries it is watched in really care about it? A resounding No
(probably half of England doesnt care too).
Duration:
Club duties in EPL spark off huge Club vs Country debates. Club icons are National
underachievers in numerous cases. In the EPL world, national duties are, for most players
My 5 years of compulsary Army Service for 3 weeks per year. While the EPL is a year
long committment with European games thrown into the mix for top 20% of clubs, the
IPL remains as of now 8-10 weeks of cricket on steroids. Do I see this changing? Yes. As
we see more Haydens, Gilchrists, McGraths coming out of retirement to play the IPL, I
am definitely expecting to see more cricketers retiring before 30 from national duty to
play the IPL.
Globalisation:
One of the best flavors of the club soccer world is when an Argentine legend in the
making playing for a Spanish club comes up against an EPL club with their version of a
Portuguese Maradona (27 May 2009). Lets hope this years T20 Champions League
(October 2009 in India) can produce crickets own Istanbul .
While the IPL has a long way to go, I think this is an exciting beginning. Lalit Modi has
shown professional sports leagues do have a place in this nations cricketing philosophy of
regional selectors. The day when the EPL, IPL and probably the NBA or MLS are talked
about in the same context is just a few years away whether India winning the world cup
will still matter more to me than Delhi winning the league remains to be seen.
Finances:
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Prize Money: per se is not such a big attraction in either case. EPL is owned by member
clubs, so members draw their money from money pool with EPL accumulated mainly by
broadcasting revenues.
In case of IPL , the revenue share model in years one to five is that 80% of the revenues from
media rights are being redistributed back to the franchises, and 60% of the central
sponsorship revenue gradually reducing this amount over the life of the contract.
Individual club earnings are from stadium tickets, club advertisements for both leagues. So
that will be key differentiating factor in earnings of clubs just like EPL (although some
difference is created at Prize Money level as well). MANU Vs Liverpool may draw record
crowds so these two clubs are far ahead in the year-end earnings amongst the 20 clubs.
(P.S.:I don't know on what basis is broadcasting revenue distributed among EPL clubs and on
what basis will it be distributed to IPL clubs by IPL governing council.)
Absolute fan base may not be such a big factor since TV audiences have already been
covered by TV rights, where both are on nearly equal footing.
Stadium attendances will be the key differentiating factor. Average stadium attendance maybe close but absolute is what is going to earn money here. So here IPL loses out and again
since it is hosting much less no. of games.
EPL registers record attendances in both home and away games. Enough heat has been
generated for IPL and all matches are being hosted in Indian cities (some like Kolkata which
have recorded upto 100,000 in ODI matches) so here too IPL is matching upto EPL's
strength.
Merchandise wise anyone can guess IPL will be nowhere close to EPL. IPL franchises are
still building their clubs while EPL has a legacy of 16 yrs behind it and merchandise forms a
decent part of premiership club incomes.
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Conclusion
IPL may lose out to EPL because EPL' season is longer so more matches and more money.
IPL may again just lost out to EPL on per match basis as well since EPL's tickets are again
overpriced (184$ for a 2006-2007 Arsenal match!!) which may not be a feasibility in India.
Also IPL clubs may have negligible merchandise sales.
IPL(Indian Premier League) brand is estimated today at a whopping $4.3 billion in less than
3 years which makes some people believe that it will soon overtake the EPL(English Premier
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League)(valued $12 billion).
Comparison:
EPL is the worlds most widely watched sporting league with viewership of over 500
million, it not only rides on Footballs universal appeal but also on the deep rooted league
culture of Europe.
IPL neither has a world audience nor a genuine league culture. It is merely about owning
teams on the strength of economic and not sporting power and attracting crowds through a
variety of sporting and non sporting gimmicks, including foreign cheer leaders and late night
partying for those who can afford it.
IPL is long on showbiz, short on substance and is unlikely to sustain beyond initial euphoria.