IPL AS A BUSINESS MODEL

By Presented

Dharmveer Thakur

Brief intro….. It was initiated by Lalit Modi, who served as the league's 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.

IPL TEAMS LOGO

TEAM BIDDING

Announcement of tender

inviting bids

Potential franchises

submit bids

Bids for more than 1 city

Awarding of franchises

Auction of players

Bid amount need to be specified

Each squad minimum 16 players with

max 4 international

4 Players under 22 from BCCI

pool

TEAM CITY OWNERS PRICE(US $)

CSK Chennai N. Srinivasan (India Cements) 91 million

DD Delhi GMR Group 84 million

KXIP Mohali Preity Zinta,Ness Wadia (Bombay Dyeing),Mohit Burman (Dabur)Karan Paul (Apeejay Surendera Group),The Oberoi Group

76 million

KKR Kolkata Shahrukh Khan (Red Chillies Entertainment),Juhi Chawla, Jay Mehta(Mehta Group)

75.9 million

MI Mumbai Mukesh Ambani (Reliance Group) 111.9 million

PW Pune Subrata Roy (Sahara India Pariwar) 370 million

RR Jaipur Lachlan Murdoch (Emerging Media),Shilpa Shetty, Raj Kundra(UK Trade corp Ltd)

67 million

RCB Bangalore Vijay Mallya (UB Group) 111.6 million

SH Hyderabad Sun TV Network 159 million

REVENUE COMES FROM…

Auction of broadcasting right

Title sponsorship and corporate sponsorship

Auction of franchises rights

Sale of tickets

REVENUE MODEL OF IPL

Broadcasting revenue distribution

1 to 3 4 to 5 6 to 100%

10%

20%

30%

40%

50%

60%

70%

80%

90%

100%

teams getsBCI gets

years

broa

dcas

ting

Reve

nue

in %

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 agreement

Prize money

Bonuses at which team finishes

Salaries

Daily allowance

BCCI REVENUE (Rs. in billion)

2010-11 2011-12

5.81

8.49

3.82

2.65

1.02 1.18

3.924.67

turnover profitincome from media rights total expenditure

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).

THANK YOU