BCCI Declines Paying Compensation To IPL Franchises And Stakeholders Ahead Of The Season

The news of the 13th season of the Indian Premier League (IPL) going ahead this year is indeed a relief for the BCCI, who could have lost a hefty sum if cancelled. With India still battling the COVID-19 crisis amid rapidly surging cases, the BCCI had to move the tournament to the UAE. The board has further reportedly announced that no compensation would be handed to stakeholders or franchises ahead of the competition.

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The initial commencing date of this year’s IPL was of the 29th of March, which BCCI postponed to the 15th of April. With the health crisis getting more severe, the BCCI had no choice but to put it off indefinitely.

The association would have lost approximately 4000 crores if the IPL was not to take place this year. With the ICC postponing the T20 World Cup scheduled for October, the BCCI booked that window for the cash-rich league, enabling players from all countries to participate.

According to the board, had the IPL not taken place this year, they would have had no revenue at all. Hence, with the extravaganza all set to kickstart from the 19th of September, some income against none at all sounds better.

The sources of Times of India suggested that the BCCI should do away with the 20% share of franchises’ top-line revenue that they mandatorily receive every season as per contract. The sources have underlined why the revenues must stay with the BCCI as this year’s IPL takes place in the UAE.

“That 20% — from all eight franchises’ top-line — goes to the members of the BCCI and is part of the revenue corpus that state associations depend on,” the sources claimed.

“Every year, the association hosting an IPL match receives Rs 50 lakh from the franchise and Rs 50 lakh from the BCCI as hosting fee — totaling to Rs 8 crore per venue and Rs 64 crore across all franchises per season. Since this year’s edition is shifting to UAE, that revenue is already out of the window, so the 20% will stay.” 

How much the IPL franchises make money in that case?

With Vivo backing out sponsoring the tournament this year, their partner can manage to raise 50% of the value VIVO generated. In that case, franchises can earn up to INR 230 crores. Reportedly, VIVO brings in nearly INR 200 crores every season that comes down to 12 crores per franchise.

Adding jersey sponsorships and other partners, the income of franchises will further increase to INR 250 crores. Even when deductions are carried out in the form of player fees and operating costs, it is understood that franchises can still make INR 100 crores in the middle of a crisis.

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