The Indian Premier League (IPL) is the most lucrative franchise-based T20 cricket league and one of the most revenue-generating sports leagues in the world. Since 2008, star cricketers from all over the world as well as Indian national cricketers have participated in the tournament. 13 successful seasons of IPL have been hosted by BCCI so far.
Since 2020, IPL matches have been held behind closed doors. One wonders how franchises are making money now without any tickets being sold. In fact, the IPL’s business model is not entirely dependent on ticket sales. Only 10% of the teams’ income comes from it.
IPL franchises have developed as valuable business properties and ensure that they do not have to depend on ticket sales to support themselves. There are several other outlets from which they can generate money. Franchise rights were sold at very high prices to private companies. Investing companies, aware of the potential financial gain, invest in IPL.
IPL has always been a mix of cricket and entertainment. Investors are aware of the fact that the tournament is a major source of entertainment for millions of people and that is why there will be no shortage of investments.
BCCI also earns a lot of revenue by selling IPL media rights. About 60-70% of IPL’s revenue comes from media rights. Networks like Star Sports, Sony Pictures Network pay enormous sums to the BCCI for the acquisition of broadcasting rights. The board, after deducting its share, distributes the proceeds among the teams. The team that wins the tournament, of course, gets the highest amount.
Teams participating in the IPL generate a substantial portion of revenue through brand sponsorship. Franchises sign contracts with brands, agreeing to endorse brand logos on their kits. About a quarter of revenue comes from brand sponsorship.
When a team wins the tournament, they earn additional revenue. 50% of the prize money goes to the players and the rest to the owners. Teams also sell merchandise such as t-shirts, caps, jerseys, etc., which also contribute to franchise revenue.
The BCCI, being the legal owner of the IPL, owns the excess profits of the league. Profits are used to improve cricket infrastructure, organize national cricket, pay national cricketers etc.
The council contributes INR 12 billion to the GDP of the Indian economy and needless to say, most of it comes from the IPL.