IPL AS A BUSINESS MODEL By Presented Dharmveer Thakur
Brief intro….. It was initiated by Lalit Modi, who served as the leagues first Chairman and Commissioner and Board of Control for Cricket in India (BCCI) in the year 2008. In 2010, IPL became the first sporting event ever to be broadcast live on YouTube. Its brand value is estimated to be more than US $ 5 billion in fifth season. It became the biggest competitor of multiplex in India.
TEAM BIDDINGAnnouncement of Potential Bids for more than tender inviting franchises submit 1 city bids bidsBid amount need Awarding of Auction of players to be specified franchises Each squad 4 Players under minimum 16 22 from BCCIplayers with max 4 pool international
TEAM CITY OWNERS PRICE (US $)CSK Chennai N. Srinivasan (India Cements) 91 millionDD Delhi GMR Group 84 millionKXIP Mohali Preity Zinta, 76 million Ness Wadia (Bombay Dyeing),Mohit Burman (Dabur) Karan Paul (Apeejay Surendera Group),The Oberoi GroupKKR Kolkata Shahrukh Khan (Red Chillies Entertainment),Juhi Chawla, 75.9 Jay Mehta(Mehta Group) millionMI Mumbai Mukesh Ambani (Reliance Group) 111.9 millionPW Pune Subrata Roy (Sahara India Pariwar) 370 millionRR Jaipur Lachlan Murdoch (Emerging Media),Shilpa Shetty, Raj 67 million Kundra(UK Trade corp Ltd)RCB Bangalore Vijay Mallya (UB Group) 111.6 millionSH Hyderabad Sun TV Network 159 million
REVENUE COMES FROM…Auction of broadcasting rightTitle sponsorship and corporate sponsorshipAuction of franchises rightsSale of tickets
Broadcasting revenue distribution 100% 90%broadcasting Revenue in % 80% 70% 60% 50% teams gets 40% 30% BCI gets 20% 10% 0% 1 to 3 4 to 5 6 to 10 years
FRANCHISEE REVENUES Media rights-to be shared among the franchisee after removing IPL’s shares. Sponsorship rights- 60 % amount collected to be distributed equally amongst the franchisee Local sponsorship-team sponsorship revenues Gate receipts- major source of revenue ,20% are allocated for IPL.
PLAYERS REVENUE basic agreementPrize moneyBonuses at which team finishesSalariesDaily allowance
BCCI REVENUE (Rs. in billion) turnover profit income from media rights total expenditure 8.495.81 4.67 3.82 3.92 2.65 1.02 1.18 2010-11 2011-12
HOW IS THE IPL INCOME DISTRIBUTED ? Share of broadcasting money with franchisees. Share of sponsorship money with franchisees. Share of ticket money with franchisees. Prize money: $5 million ($3 million for winner; $2 million divided among others).