Saturday, February 23, 2008

Indian Premier League - the business of cricket

The recent auctions by Board of Control of Cricket in India (BCCI) has transformed cricket from a sport to a commercial venture.

If my calculations are correct, I believe already the gross bidding may have exceeded Rs. 6000 crores (US$ 1.5 billion) including franchises, players and the television rights bought by Sony Entertainment for more than 3000 crore.

It was really surprising to see the amount of commercial interest displayed by some of the top business houses and Bollywood personalities in bidding first for the franchises and then for the players.

With so much publicity around the financials at stake around the favourite Indian sport, it remains to be seen how the common man reacts to the issue. After all, it is the common man who is not only expected to meet the entire cost, he is expected to deliver a handsome profit for the bidders who have already invested so much.

With eight local (Indian) teams with players from all over the world, surely the national loyality issue is out of the picture. It would be interesting to see how much support these games could get what different venues of generating revenue are adopted. Obviously, the most popular route will be advertising and ticket sales.

If the anticipated advertisement revenue is generated and if all the advertising transforms into additional business for the advertisers it could mean a massive spurt in growth in the overall national economy.