How The IPL Became One Of The Richest Leagues In Cricket and Sports

Cricket it's a sport that
dates back over 400 years. And as of 2019 is officially played
in 104 countries around the world. But cricket's popularity is starting
to take a hit. And things are especially bad in the
country of its birth, the UK. Ratings there have fallen
off a cliff. Less people are playing the sport
and attendance at traditional Test cricket matches is falling. Part of the problem, you can no longer
watch cricket on TV for free in the UK. In 2005 the sport became a pay to
watch event on TV when the England Cricket Board saw the broadcast rights to
Sky Sports by selling out Sky Sports. Whilst that brought a lot of money into
the game for the clubs and the ECB it killed the television audience. Since that day we've
seen attendance has declined. We've seen participation decline. We've seen the sport really struggle
to generate the next generation of funds and players. Another problem, attention spans who
appear to be getting shorter traditional games known as Test
matches last for five days.

And cricket enthusiasts just aren't as
patient as they used to be. So you are asking people to give up a
lot of leisure time and we know that working commitments are higher in the
UK now than ever before. People are being asked to play more
of less disposable income on trade time so that's a big factor as
well with a sport like cricket. But there is one country where cricket
is more popular than ever, India. Cricket's worldwide fan base is comprised
of roughly one billion people in the Indian subcontinent alone makes up
90 percent of those fans. In India, the country adopted a brand
new shorter format of the game has drastically cut down on playing
time from days to hours. The Indian Premier League or the IPL
has only been around for twelve years but it's fast become one of the
most popular and valuable cricket leagues on the planet.

The IPL is brand value has nearly
doubled in the last five years. In 2018 the league was valued at 6.3 billion dollars. It rakes in and 510 million dollars
each year from its broadcasting rights deal making it to only cricket league in
the world to crack the top 20 most valuable media rights deals in
all of professional sports joining the ranks of the NFL the NBA and MLB. So how did the IPL become one
the most lucrative cricket leagues on the planet. And could this surge in popularity engineer
a turnaround for cricket on the world stage.

The first record of cricket being played as
an adult sport was in 1611 in England. The sport started to take shape in the
17th century and by 1709 it was recognized as a legitimate pro sport. This was about the time the
professional village cricketers were hired to join county teams. By the early 18th century cricket was
the leading sport in London and other counties across England because of the
reach of the British Empire. The sport took root around the world
when it came to the British Empire. And when it came to Britain colonizing the
world cricket was seen as a way to tensely of civilizing the world. Cricket has a series of moves as a
series of codes of conduct such as war King when the when the
umpire keeps you out. There was an element as well
of muscular Christianity that healthy exercise was very very good. As early as the 17th century cricket
was being played in English colonies North America and during the 18th
century colonists introduced cricket to the West Indies and Australia while
mariners from Britain's East India Trading Company brought the
game to India.

In the 19th century New Zealand and
South Africa also began to play the sport. Over the years cricket has evolved
into three different formats Test cricket. One day in 2020 the Test
cricket format debuted in 1877. These matches last five days. One Day Cricket started back in 1971
and as the name implies cricket matches conclude within a single day. And in 2003 2020 was established. 2020 is a streamlined version of
cricket that allows for faster gameplay and more scoring 20 20 games typically
wrap up in about three hours. Each version of cricket has
leagues around the world. But 2020 is the most popular format of
the game today and in India it created its own 2020 league in 2007
when it rolled out the Indian Premier League.

In India. Cricket is huge. It's been a staple in Indian
sports since the seventeen hundreds. It's currently the most popular
sport in the country. The IPL is one of the
richest sports properties in the world. And while the IPL isn't the only cricket
league in India it is the most successful league in the country. The 48 day annual tournament was created in
2007 with the help of the Board of Control for Cricket in India
and Indian businessmen Lalit Modi. Even though cricket already had a few
pro cricket leagues they wanted to capitalize on the commercial
success of 2020. So they modeled the IPL in a similar
nature to pro sports in the US. The IPL was specifically modeled after
the likes of the NFL.

Which has a decentralized league. meaning that all teams are
owned and operated independently. Also similar to the NFL model the IPL
is its own league with its own unique structure. There is a separate T20
World Cup where India competes. But that's different from the IPL. even though matches are
all held in India. Team rosters are chock full
of top international talent. In 2018, teams spent 94 million dollars
to buy 169 players in an auction. up from its 40 million dollars
for 66 players in 2017. But what you've actually got in the
IPL franchises who represent a city a place an industrial heartland and you've
got the full support of some major entrepreneurs. So rather than let's say Delhi again. So you've got your IPL
franchises based around the cities. I'm not as actually
have a massive impact. in terms of global cricket. To make sure the stands are filled with
as many IPL fans as possible and to maximize TV viewership. Matches are typically played in
the evening and on weekends.

The IPL is a huge
moneymaker in India since 2014. The IPL brand valuation has doubled
to six point three billion dollars. The reason the IPL has won the largest
fan base is for a single sports league in the world. During its opening week of the 2013
season the IPL broke records when 371 million viewers tuned in to watch and by
the last week of the tournament a total of 769 million fans
watched the 2013 IPL season. The ad revenue generated for that
season was over 276 million dollars according to Star
India's managing director. High ratings and ad dollars were a
big part of why a major U.S. media companies had their eyes
on IPL broadcasting rights. When the IPL launched in 2008. The league issued being your rights
to Singapore based sports marketing agency World Sport group. They broadcast an IPO matches on
India's Sony Macs TV channel. Under the terms of the 10 year
contract World Sport group paid the IPL approximately 1 million dollars per match
in its first year for the exclusive broadcasting rights.

The overall value of that broadcasting
deal was 918 million dollars when the broadcasting deal
expired in 2017. There was a global bidding war
for exclusive rights for the IPL. Fox and Sony put in competing bids while
Facebook also put its hat in the ring for the 2018-2022 digital rights of
the IPL making a 600 million dollar offer. Those TV and digital rights eventually
went to Fox the American broadcasters struck a five year 2.5 five billion dollar deal for the
global media rights of the IPL. The price per match jumped from
1 million dollars to about 8.47 million dollars per game. For comparison the NFL cost
per game is around 22.5 million dollars. The English Premier League
is around 13.2 million dollars. The NBA is close to 2 million dollars
and the MLB is just 630 thousand dollars per game. Just two years after the ink dried on
the Fox IPL deal Disney completed a 71 billion dollar deal for Fox entertainment
assets one of the assets that Disney now owns is hot star.

The Indian video streaming
company in 2019. Streaming service at a global record for
the number of people tuning into a life streaming event. There are 18.6 concurrent viewers watching the IPL final
match on the hot star's website in app. And with that kind of viewership naming
rights for the IPL are also huge for the league. Since 2008 the IPO naming rights have
changed hands three times from brands DLF to PepsiCo India and finally to
Vevo a mobile handset manufacturer in China. Vevo first took over title sponsorship in
2015 and in 2017 Vevo signed a fresh five year deal with the
IPL worth approximately three hundred forty one million dollars in 2018. The average salary of cricket players in
the IPL jumped nearly 30 percent from the year before. All thanks to the massive TV
deal signed with Fox in 2017. Before the deal, players across the league
had an average salary of 3.9 million dollars but in 2018 the average
salary was just over 5 million dollars. And unlike other major sports leagues
the IPL season is so short that players have a chance to bank
even more cash in the off season. The IPL takes place in the spring starting
at the end of March or early April and continuing through May.

That means cricketers have the flexibility
to play for other clubs around the world. Take the Mumbai Indians
player Kieran Pollard. In 2017 he and more than
one million dollars for two months. They play for the Mumbai Indians
and IPL in that same year. Pollard had multiple revenue streams from
playing for cricket leagues in Australia Bangladesh and
South Africa. But just as cricket first spread across
the world in the 18th century cricket's latest form of 2020. Similarly. Taking root
across the globe. There's even a record breaking investment
for 2020 league in a country where cricket is even
remotely popular, the U.S. In May, 2019, USA Cricket received
a 1 billion dollar investment from American cricket enterprises to develop
a 2020 league in America. It's one of the biggest deals for
development of domestic cricket in the US and the launch of the league is set
to take off in 2021 since the 2020 cricket format was introduced in 2003 and
has taken the cricket world by storm.

And it doesn't seem to
be slowing down anytime soon..

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