No ticket sale since 2020- How IPL franchises are making money now
Since 2020, the IPL matches have been held behind closed doors. One may wonder how the franchises are making money now with no tickets being sold. In fact the business model of the IPL doesn’t wholly depend on ticket sales. Only 10 percent of the teams' revenue comes from it.
The Indian Premier League (IPL) is the most lucrative franchise-based T20 cricket league and one of the highest revenue-generating sports leagues in the world. Since 2008, star cricketers from all over the world as well as Indian domestic cricketers have been participating in the tournament. 13 successful seasons of the IPL have been hosted thus far by the BCCI.
Since 2020, the IPL matches have been held behind closed doors. One may wonder how the franchises are making money now with no tickets being sold. In fact the business model of the IPL doesn't wholly depend on ticket sales. Only 10 percent of the teams' revenue comes from it.
The IPL franchises have developed themselves as valuable commercial properties and they make sure they don't have to depend on selling tickets to sustain themselves. There are several other outlets where they can generate money from. Franchise rights have been sold at very high prices to private firms. Investing companies, aware of the potential financial profit, invest in IPL.
IPL has always been a mixture of cricket and entertainment. The investors are aware of the fact that the tournament is a major source of entertainment to crores of people and that's why there won't be any shortage of investments.
The BCCI also earns a lot of revenue by selling the media rights of the IPL. Around 60-70 percent of the revenue earned by IPL is generated through media rights. Networks like Star Sports, Sony Pictures Network pay jaw-dropping sums to the BCCI for acquiring the broadcasting rights. The board, after deducting its share, distributes the revenue among the teams. The team winning the tournament, of course, gets the highest amount.
The teams participating in the IPL generate a substantial portion of the revenue through brand sponsorship. Franchises sign contracts with brands, agreeing to endorse the logos of the brands on their kits. About one-fourth of the revenue comes from brand sponsorship.
When a team wins the tournament, it earns additional revenue. 50 percent of the prize money goes to the players and the rest to the owners. The teams also sell merchandise like T-shirts, caps, jerseys etc which also add to the earnings of the franchises.
The BCCI, being the legal owner of the IPL, owns the surplus profits from the league. The profits are utilised to upgrade the cricketing infrastructure, organise domestic cricket, pay the domestic cricketers and so on.
The board contributes INR 12 billion to the GDP of the Indian economy and needless to say, most of it comes from the IPL.
