#21. How IPL has Changed in the Last 16 years

Economics of the IPL

Author

Pranav Divakar G
April 15, 2024

Here are 7 facts on how the economics of the IPL has changed in the last 16 years

  1. Brand Value, a.k.a. Valuation: IPL was valued at $1.1 billion at its launch in 2008, and today, it is valued at $10.7 billion.

  2. Broadcast Rights: In 2008, the broadcast rights were sold for Rs 820 crore annually. Today, they fetch Rs 9,678 crore per year.

  3. Title Sponsorship: The title sponsorship for the first year was sold for Rs 40 crore to DLF. In 2024, it was sold for Rs 500 crore to the TATA Group.

  4. Average Ticket Price: Today, the average cost of an IPL ticket is approximately Rs 1500, a significant increase from around Rs 400 in 2008. (Disclaimer: This is a rough estimate or back-of-the-napkin calculation.)

  5. Prize Money:In 2008, the IPL winning team received Rs 4.8 crore and the runner-up team received Rs 2.4 crore as prize money. In 2023, the winners received Rs 20 crore, and the runners-up received Rs 13 crore. The prize money for 2024 has not been officially announced yet.

  6. Cost of Buying a Team: In 2008, the lowest priced team, Rajasthan Royals, was purchased for Rs 273 crore. In contrast, in 2022, when two new teams were added to the IPL, the Lucknow Super Giants were bought for an astounding sum of ₹7,090 crore. For comparison, the most expensive team in 2008, the Mumbai Indians, was bought for Rs 456 crore.

  7. Most Expensive Player: In the inaugural season, the most expensive player was MS Dhoni, who was sold to CSK for Rs 9.5 crore. By 2024, Mitchell Starc held that title, being sold to the Kolkata Knight Riders for Rs 24.75 crore.

As I mentioned in my previous blog, the launch of the IPL has turned cricket into a spectacle of entertainment. Celebrities and business moguls have become involved, institutionalizing the game. Cricket now competes for prime-time TV against cinema and other entertainment options. For many Indians who sit down for dinner in front of the TV at 8 pm, this has shifted the perception of cricket from being just a sport to a full-fledged entertainment spectacle.

What you'll see below is a breakdown of the facts that I stated above, some are ridiculously interesting. If you are curious about the amount that is spent on advertising every year during the IPL season, read on:

  1. Brand Value - a.k.a. Valuation: When the Indian Premier League (IPL) was first launched in the year 2008, it was valued at an impressive $1.1 billion. This marked a significant milestone in the world of cricket, setting off a new wave of excitement among fans and players alike. Over the span of fifteen years, by the end of 2023, the value of IPL skyrocketed to an astounding $10.7 billion. This ten-fold increase in its value is a testament to its growing popularity and the immense success it has achieved. Just as the brand value of the IPL itself has grown exponentially, the value of the individual IPL teams has also seen a similar rise. Each team, with its unique blend of players and strategies, has contributed to the overall value and success of the league.

  2. Broadcast Rights: Even during its inaugural year, the broadcast rights for the IPL were sold for staggering sums. These rights are sold through multi-year contracts that span 5 to 10 years. In 2008, the average broadcasting cost for one year was Rs 820 crores, and by 2024, it surged to Rs 9,678 crores!!!


    The first-ever broadcast rights of the IPL in 2008 were sold to Sony Pictures for a 10-year period, with a bid of Rs 8,200 crores. This deal included all types of broadcasting rights. However, starting from the 2023–2027 cycle, the broadcasting rights were divided into four categories:

    • TV Rights

    • Digital Rights

    • 18-game non-exclusive rights (which include the rights for the season opener, three playoffs, finals and weekend double headers, amounting to a total of 18-20 matches per season)

    • Overseas TV & Digital Rights


    In the recent broadcasting rights cycle, BCCI managed to generate a staggering Rs 48,391 crores. That's Rs 9,678 crores per year, or Rs 130.7 crores to broadcast each IPL game.


    Here’s the breakdown of these rights:

    • TV rights were acquired by Disney Star for Rs 23,575 crores.

    • Viacom secured both the digital rights and the 18-game non-exclusive rights for Rs 23,758 crores.

    • Overseas TV and digital rights were sold to Viacom & Times Internet for Rs 1,058 crores.


    Aren't these numbers mind-boggling?

  3. Sponsorship Deals: The IPL of-course attracts a ton of sponsors each year & the biggest haymaker in-terms of revenue generated are the “Title Sponsors” along with the 6 Associate Sponsors, a.k.a. Official Sponsors, which all add up to a significant chunk of revenue for the BCCI. For the 2024 IPL season alone, the BCCI sold four sponsorship slots for an impressive Rs 1,485 crore.

    TATA Sons recently outbid the Aditya Birla Group to secure the IPL title sponsorship rights for ₹2,500 crore from 2024 until 2028.


    The BCCI successfully sold three of the six available associate partnership slots to My11Circle, RuPay, and Angel One, while managing to retain CEAT as the strategic timeout partner. However, there were no bidders for the orange and purple cap, and umpire partnerships this time around.


    Remember, the sponsorship’s mentioned above are direct/official sponsorship's with BCCI. However, various other brands also sponsor individual IPL franchises. Each IPL franchise attracts about 12-15 brands annually for different types of sponsorship.


    Moreover, the broadcasters, who paid billions of dollars for the rights to broadcast the games, also brought on board sponsors and advertisers. For instance, Viacom18 aimed for ad revenue of Rs 3,700 crore from the 2024 season, with already confirmed deals worth Rs 2,700 crore. This showcases the league's advertising appeal.


    A report by the brokerage firm Jefferies states, "A single IPL match now generates approximately $16 million in broadcasting revenue, second only to the USA’s NFL, which generates $37 million."

  4. The average ticket price for an Indian Premier League (IPL) match in 2024 is thought to be about Rs 1,500. This is a big jump from the past. In 2008, when IPL started, the average ticket cost around Rs 400. These numbers might not be completely accurate, but they show how much ticket prices have gone up.

    In the first IPL season, franchises were unsure about how well the league would do. They didn't know if they could sell all their tickets. To get more viewers, they decided to set ticket prices at half of what an ODI match would cost. This was done to allow more people to watch the matches and build excitement.

    At that time, most people in India didn't buy tickets online. Around 90% of IPL tickets were sold at counters. Only a few teams sold tickets online. But now, with the help of technology, many tickets are sold online.

    The shift from offline to online sales and the increase in ticket prices show not only how popular IPL has become but also how buying habits and technology in India have changed.

  5. Prize Money: In the world of IPL, the prize money has been blowing up every few years. Back in 2008, the first ever IPL handed out a cool Rs 4.8 crore to the winner. Yep, it was a big deal from the get-go. Fast forward to 2023, and the prize money shot up to a whopping Rs 20 crore. Talk about growth, right?

    And let's not forget about the runners-up. They started off with Rs 2.4 crore in 2008, and by 2023, they were raking in Rs 13 crore. Not too shabby, eh? As for what's happening in 2024, well, the Board of Control for Cricket in India (BCCI) hasn't spilled the beans yet. But the rumour mill's churning, and folks are betting that the prize money's going to see a major boost, thanks to all the broadcasting and sponsorship cash the league's pulling in.

  6. Cost of Buying a Team: Imagine this: You're in the market to buy a cricket team today. Get ready to dig deep into those pockets, just like the Lucknow Super Giants or the Gujarat Titans did recently. To give you an idea, the Lucknow Super Giants had to part with ₹7,090 crore, while the Gujarat Titans shelled out ₹5,625 crore to own a team.

    Now, let's hop into our time machine and dial it back to 2008. Back then, you could own a team for a fraction of today's prices, some even going for less than Rs 300 crore! The big spender back in the day parted with a'mere' Rs 456 crore. It's quite the trip down memory lane, isn't it?

    And here's the kicker: This was all happening during a major economic downturn, with billions of dollars evaporating into thin air. Investing such hefty sums into a cricket team, of all things, was seen by many as a daring, even foolhardy, move. You could almost hear people saying, "Have they gone mad, pouring so much into a cricket game?" It's quite a spectacle to see how much attitudes and values have shifted over time.

  7. Most Expensive Player: In the inaugural edition of the Indian Premier League (IPL), MS Dhoni was the top-priced player at Rs 9.5 crore and was scooped up by the Chennai Super Kings. By 2024, Mitchell Starc became the most expensive player at Rs 24.75 crore!

    Starting small in 2008, the IPL now attracts the crème de la crème of top cricketing talent worldwide.

    The high player prices reflect the IPL teams' financial power, backed by India's biggest businesses and substantial sponsorships. It's also a testament to the fans' support.

    For players, the IPL offers a chance to earn well and compete in one of the world's most competitive cricket leagues!

Most Expensive Players of Each Season

Fun Fact: When MS Dhoni decided to hang up his captain's hat for CSK this year, it led to an interesting first: every single team now has a different captain than they did back in 2008!

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