IPL 2021 Revenue Losses – BCCI, franchises and Star revenue take big hit: With the Indian Premier League suspended; BCCI, broadcaster Star Sports and the eight franchises stare at massive losses. Calling off the tournament would affect multiple stakeholders of the league, with the central pool taking a hit of nearly INR 2000 cr. Valued at $6.2 billion by Duff and Phelps after IPL 2020, the fate of the revenue cycle depends on whether the season is shelved or resume later in the year. But whatever may the outcome be, the players will get paid in full as per their contract. As per InsideSport.co understanding, all IPL Players salaries will be paid in full.
IPL 2021: IPL player Salaries to be paid in Full, check why?
Under the terms of a standard IPL Players contract, the franchises pay salaries in three instalments. The first instalment has already been paid, with the last two payments held over until the conclusion of the tournament. Even if, BCCI fails to resume the league the players will get their full salary. All IPL players’ salaries are insured under the franchises insurance policies that cover them in the event of injury or any other mishappening. The total player’s salary, according to InsideSport Moneyball is nearly INR 483 crore in IPL 2021.
The league runs on a unique business model, and should it take a financial hit, it will affect the stakeholders too.
If the IPL is not held this year, force majeure will come into play. According to this, the Star will pay BCCI on a pro-rata basis for the number of matches played. Star pays BCCI INR 54.4 crore per match. Hence the broadcaster will only pay INR 1,577 crore for 29 matches. BCCI will suffer a loss of nearly INR 1,700 crore for the remaining 31 matches.
To add to the revenue loss woes for BCCI, even the title sponsor Vivo will not pay for the nearly INR 225 crore (INR 7.3 core per game).
As for the franchises, BCCI and the IPL teams work on a 50:50 revenue sharing formula. Therefore, BCCI will share 50% of the revenue earned from the central pool with the franchise.
Official partners Tata, Unacademy, Dream11, Cred, Upstox, PayTM and CEAT combined pay INR 300 cr (approx) for a full season. But now they will not pay INR 144 crore to INR 155 crore. Star too will face loses as the sponsors will not pay them the agreed full amount.