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Indian Premier League, IPL, is back with a much bigger and more lavish spread. The fifth season of the IPL will begin on 4 April in Chennai and will end on 27 May 2012.  But Not everything in the IPL garden is rosy. Audience growth has slowed as the initial lustre has faded. Infact Bollywood has planned some of the major releases in the IPL 5 season. The question on everyone’s mind is Will IPL 5 be a success? In this article we shall talk about the money aspect in IPL, its valuation, its teams valuations, the prize money, money earned by cricketers in IPL, pros and cons of IPL, how does it compare to other sports and leagues around the world  and trying to answer the question is Indian Premier League a Indian Paisa Leauge?

IPL

HE INDIAN PREMIER LEAGUE (IPL), which completed its ninth season in 2016, is the biggest brand ever in cricket history. In 2015, the valuation appraisal firm Duff & Phelps estimated the IPL brand to be worth $4.5 billion (Rs 27,000 Crores). According to the Broadcast Audience Research Council of India, total TV viewership of IPL 2016 calculated by impressions stood at 102 Crores. A report by management consultancy firm KPMG puts the total impact of IPL 2015 on the Indian economy at Rs 1,150 Crores, more than 0.6 per cent of the country’s GDP. IPL’s predominant source of income is its corporate sponsors. This is a guaranteed sum generated annually from the league’s official sponsors. A pre-determined percentage of funding (approximately 60%) received from sponsors sees an equitable distribution amongst all franchises. Similarly, television broadcasting rights of the games is another spectacular source of funding as a chunk of its proceeds as BCCI distributes it equally amongst franchises. The Board of Control for Cricket in India stated that the Indian Premier League has scripted faster growth than the football league Manchester United.

IPL season 1-9

IPL season 1-9

Indian Premier League

IPL was established by the Board of Control for Cricket in India (BCCI) and the first season or inaugural season of the tournament started on 18 April 2008 , included 8 times and lasted for 46 days. When Indian Premier League was planned, no one would’ve imagined it would turn into the mania it has become today. It is marketed well, but its runaway success is down to more than canny marketing.

  • IPL uses Dhamkedar Twenty20 format – either stop the batsman from scoring quickly or score ten-an-over while batting.
  • IPL has attracted hefty investment from corporates.
  • It attracted Bollywood stars to associate themselves with the game.
  • They partnered with IMG, the world’s biggest sporting event group, to ensure best practice from the likes of soccer’s English Premier League were brought in.

The IPL is predicted to bring the BCCI income of approximately US$1.6 billion, over a 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. After 2017, revenue distribution would be 50%, franchisees 45% and prize money 5%.  Ref:Wikipedia:IPL

It’s official website iplt20.com and facebook page. It has free Iphone app – IPLt20  too!

IPL prize money

Indian Premier League is one of the richest domestic cricket tournaments in the world . The inaugural Indian Premier League(IPL) of 2008  offered a winners’ cheque of Rs 4.8 crore and an overall prize money of Rs. 12 crore. Since then the prize money has only been increasing. Table below lists the prize money in IPL 2016 and table below shows the

Indian Cricket Premier League 2016 – Prize Money Breakdown
STAGE PRIZE MONEY
WINNERS  $3 million (₹20 crore)
Runners-up  $1.5 million (₹11 crore)
3rd Placed Team in Playoff  $900,000  (₹7.5 crore)
4th Placed Team in Playoff   $900,000 (₹7.5 crore)
Other four teams ? Teams who don’t qualify for playoffs are not paid any prize money
Do players get prize money ? YES, according to BCCI/IPL mandate half of the prize money won by team will be awarded to the players

Teams: Rajasthan Royals:RR Chennai Super Kings:CSK Royal Challengers Bangalore:RCB Mumbai Indians:MI Deccan Chargers: DC Delhi Daredevils:DD Kings XI Punjab:KP Kolkata Knight Riders:KKR Pune Warriors India:PWI Kochi Tuskers Kerala:KTK

IPL  Season 5:2012 Season 4:2011

(in Rs)

 

Season 3:2010 

(in Rs)

Season 2:2009

 (in Rs)

Season 1:2008

 (in Rs)

 

Winner  $2 million 10/6 crore CSK 6 Crores CSK 4.8 crore
DC
4.8 crore
RR
Runners Up  $1.5 million 5/3 crore RCB 3 Crores MI 2.4 crore
RCB
2.4 crore,
CSK
3rd 1.75 Crores MI 1.75 Crores RCB 1.2 croreDD 1.2 croreKP
4th KKR DC 1.2 croreCSK 1.2 croreDD
5th KP DD 80 lakhKP 80 lakhMI
6th RR KKR 70 lakhRR 70 lakhKKR
7th DC RR 50 lakhMI 50 lakhRCB
8th KTK KP 40 lakhKKR 40 lakhDC
9th PWI  –
10th DD   –  –  –
 Ref:TOI (Ref:Business Standard)

Note:We found conflicting reports about Prize money for IPL 4. with ritrosoft.com claiming Winner prize is 10 crore and sportingattitude.com claiming 6 crore. Please help us in filling/verifying the table.

Some of the other prizes given in IPL 2016 or IPL 9 are as follows.

  • 2016 Champions – Sunrisers Hyderabad. Prize money – Rs 15 crore
  • Runner-up – Royal Challengers Bangalore. Prize money – Rs 10 crore
  • Orange Cap (Most runs) – 973 runs (16 innings) – Virat Kohli (Royal Challengers Bangalore)
  • Purple Cap (Most wickets) – 23 wickets (17 innings) – Bhuvneshwar Kumar (Sunrisers Hyderabad)

For comparison in Cricket World Cup 2011 the total prize money was 44.1 Crore Rs with following distribution:

  • Rs 13.8 Crore to Winner Teams.
  • Rs 6.9 Crore to Runner-up Teams.
  • Rs 3.45 Crore to the 3rd and 4th Place Teams.
  • Rs 1.80 Crore to the 5th to 8th Place Teams.

IPL income and expenses

From BCCI annual report 2015-16 IPL income and expenses are as follows (pg 160)

IPL Income and expenses

IPL Income and expenses

Brand Value of IPL and teams

The UK-based brand consultancy, Brand Finance, valued IPL at $3.67 billion (2011) ,  $4.13 billion (Rs 18,998 crore) in 2010, $2.01 billion (2009)Let’s see the valuations of IPL stands with respect to lucrative, intense, and largely undocumented Sports of the world. As per  SportsPromedia:The world’s 200 most valuable sports properties(Jul 2009) the world’s most valuable sports property are:

Leagues Country Sport Valuation
The National Football League (NFL) USA Football  US$4.5 billion
Major League Baseball (MLB) USA Baseball  US$3.9 billion
National Basketball Association(NBA) USA Basketball  US$3.35 billion
National Association for Stock Car Auto Racing (NASCAR) USA Motor Car Racing  US$1.9 billion

Indian Premier League (IPL), valued at US$1.6 billion in 2009 is considered a staggering achievement for a two-year-old property. Now Let’s look at valuations of teams over the years in millions:

 Teams 2011 2010 2009
Mumbai Indians $57.13 $40.80 $41.6
Chennai Super Kings $55.37 $48.4 $39.4
Royal Challengers Bangalore $47.58 $41.9 $37.4
Kolkata Knight Riders $46 $46.05 $42.1
Delhi Dare Devils $40.85 $40.55 $39.2
Hyderabad Deccan Chargers $38.76 $34.44 $34.8
Kings XI Punjab $35.75 $36.05 $36.3
Rajasthan Royals $33.78 $45.16 $39.5
Ref:Rediff

Comparing it to the most valuable franchises in the world as per Forbes:The world’s most Valueable Sports Team

 Name  Sport League Value  Owner
Manchester United Soccer/Football England Premier League $1.86 billion Glazer family
Dallas Cowboys American Football America National Football League $1.81 billion Jerry Jones
New York Yankees Baseball America Major League Baseball  $1.7 billion Steinbrenner family
Washington Redskins American Football America National Football League $1.55 billion Dan Snyder
Real Madrid Soccer/Football Spanish Football andEngland Premier League $1.45 billion Club owners

Cricketers and money

We hear or read news like MS Dhoni earns Rs 450 crore a year, Sachin endorses a brand for Rs 5 crore, Gautam Ghambir got Rs 11.04 crore in IPL4 auction. All such news make us think that these cricketers are minting money. But it’s actually the top players like Sachin, Dhoni who rake in the moolah. We can compare it to hearing about NIT-Allahabad student bags Rs 1.34-cr Facebook offer (Jan 2012) or Three IIM-A students bag Rs 1 crore package (Oct 2011) which is for top students of instiute and not everyone. Cricketer and Money(Mar 2012) discuses in detail about How much does a cricketer earn? How much IPL pays cricketers?What about the endorsements and his retirement?

Sanjay Manjerakar,Former India batsman; now a cricket commentator and presenter on TV on ESPCCricInfo:Thank god for the IPL(Apr 2011) said

 I believe the IPL should be given a special window in the ICC cricket calendar for just one reason and one reason only: because the players benefit from it greatly. I know international cricket makes money for players, but it does not even come close to matching what one IPL season can put in their pockets. The IPL has its flaws, but no other cricket event in history has created so much wealth for such a large number of players. As a former India cricketer I am glad it is making so many domestic players financially secure.

Aakash Chopra, opening batsman and author also agree about it. Quoting from Yahoo:Pros and Cons of IPL 

Playing one full year in all three formats for Team India, a player stands to earn between USD 1-1.5 million, which includes the annual central contract fee too. But one needs to be a player of extraordinary ability to not only fulfill the demands of three different formats but also remain super-fit too, to avoid missing tournaments due to injury. On the contrary, a player of very limited abilities can earn USD 2 million and above for playing 14 T20 matches lasting 3 hours each over 8 weeks. 

IPL raises the question Is Technique, passé? Gen Next is asking for reasons to play the longer format of the game. Are you playing for your country, for those countless millions of fans who follow the fortunes of the national team, who make cricket the game it is in India? Or are you playing for Vijay Mallya, Mukesh Ambani et alRight from the first edition of the IPL, players picking up injuries during IPL season and then miss participating in the International series right after the IPL has been growing! IPL has affected the game everywhere in quality, schedules and priorities. What is IPL doing to Indian cricket, cricket in general is discussed in detail in Hindu-BCCI: Billionaires Control Cricket in India(Jan 2012) 

IPL has always been mired in controversies. 2011 asked if IPL would survive without Lalit Modi, 2010 was about the underlying financial mess within BCCI, 2009 saw IPL being forced to go out of the country while 2008 the inaugural edition raised the questions about the feasibility of such a high profile, ultra-rich but long drawn out league. Will IPL-5 be able rise above the controversies around it,the India’s disastrous tour down under and in Asia Cup,  falling TRPs and viewer fatigue is to be seen.

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