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Discussions with ICC over T20 World Cup prove IPL's pulling power
SIMON HUGHES: It is a measure of the power and influence of the IPL – estimated last year to be worth $6.3bn, and it is why the ICC will inevitably bow to the tournament’s greater commercial potential this year
Serious pressure has been exerted on the ICC from within India’s cricketing powerhouse to persuade the global governing body to postpone the T20 World Cup and allow the Indian Premier League to be played in its place – from the end of September. This may sound like another sporting case of the tail trying to wag the dog but, in fact, it is anything but. World cricket depends more on the IPL than it does on the ICC or any other country or governing body.
If you didn’t already acknowledge this, a new report by the former IPL chief executive Sundar Raman confirms it. The IPL generated $614m in 2019, which is roughly a third (32%) of global cricket revenues. The ICC, by comparison, contributed $471m to the global pot – and that was in a World Cup year.
It is a measure of the power and influence of the IPL – estimated last year to be worth $6.3bn, which is similar in value to English football’s Premier League. It is why the ICC will inevitably bow to the tournament’s greater commercial potential this year and facilitate it to be played through late September and October – the very time that the T20 World Cup was scheduled.
The graph below illustrates the impressive revenue generation of the IPL compared with other countries’ economic output from cricket. It is clear, just visually, how much of a contribution the IPL makes to the cricket economy – and this is income that does not just end up in the sub-continent. Players, coaches and other staff from all over the world are employed at the IPL and English players, for instance, have to pay a proportion of their salaries back to the counties in lieu of matches they may have missed at home.
They will also have to pay UK tax on this income. Some sponsors and investors in the competition are also from outside India and also benefit from the success of the competition. Overall, the IPL has reinvigorated global interest in the game and there are now around 30 copycat leagues, although only some of them make money.
The other major insight from a graph like this is from what sources that income is generated. The enormous broadcast deal the IPL commissioners signed with Star TV in 2017 ($2.5billion for five years – so $500m a year) dwarfs any other television deal previously negotiated for cricket and illustrates the importance of broadcast deals for the sustainability of professional sport.
Sponsorship and digital revenues are wedded to broadcast deals and TV audience sizes. The ECB’s reliance on gate receipts – prior to the new £1.1b broadcast deal (which runs from this year onwards, so is not included in these figures) – underlines why English cricket’s finances are so fragile.
With no gate receipts in prospect this year, many counties see little point in staging matches. It is why the new television deal – structured around the much-maligned Hundred – is so precious to the ECB. It transforms England’s dependence on match-day income which is so hard to sustain in any year, never mind this one.
The cricket economy is at a tipping point. If there is no IPL (or T20 World Cup) this year, global cricket income could be down by over 80 per cent. The IPL is worth nearly half of that loss, the T20 World Cup only a quarter. So, if there is room for only one, it is fairly obvious which that might be. It is of course important that the IPL donates some of its revenue back to the ICC to be shared out amongst the member countries so they are compensated for the loss of the T20 World Cup.
That deal will be being worked on as we speak. And this will create a precedent for the way forward. In future the IPL will pay a premium to the ICC for its privileged and unchallenged position in the cricketing calendar. And all countries will ultimately benefit.
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