How IPL works?

Hey it has been a very good entertainment packed one and a half month for all the cricket lovers. IPL has become a huge hit and there is no hint of doubt about that. All enjoyment really comes with a price. But this time its really a huge amount. The following so called official IPL twenty 20 website(IPL official site) can give you some information regarding the scores, schedules and the bidding amount for each team. Still not convinced. Confused about how people are earning money out of IPL. Here is an interesting article from surfindia.com regarding how it all works.

Some excerpts from the website.

The Beginning

Masterminded by Lalit Modi, chairman of the marketing sub-committee of the BCCI, the Indian Premier League was launched on 14th September 2007 on the lines of English Premier League (Football) and National Basketball Association. Studded with the starry glitz of Bollywood and backed by the money-power of Indian business tycoons, the IPL is all set to the change the face of international Cricket in 21st century, that was redefined by the Kerry Pecker's World Series Cricket in late 1970s.

Bidding of Team Franchise

Redefining the current face of Indian cricket on Wednesday, 20th February 2008, it rained millions of dollars within ten hours in Mumbai's Oberoi Hilton's auction room, as 77 cricketers went for bidding in the player auction of Indian Premier League. Bollywood superstar Shah Rukh Khan, biggest & one of the richest Indian corporates Mukesh Ambani and Vijay Mallya were among the franchise owners, of the eight IPL teams, to bid from the world's best cricketers who were put on the show.

The Economics of the Indian Premier League

Money really matters and the IPL is no exception to it. The IPL or the richest cricket league so far would fetch big bucks for the BCCI, IPL and all the eight franchisees. There would be four major sources of income for the IPL :-

* The sale of media rights for broadcasting of the IPL matches would get in Rs. 4,000 crs. Sony Entertainment Television (SET) and Singapore based World Sports Group has got the global TV broadcasting rights of the Indian Premier League for the next 10 years. Out of this Rs. 4,000 cr the IPL would get 20% for itself, 8% as the prize money and the remaining 72% would be evenly distributed among the eight teams. The existing arrangements would work till the year 2012 after that the fresh auction will be held.

* The title sponsorship rights for the Indian Premier League has been secured by the DLF Universal, Indian real estate developer. Hero Honda group would be the associate sponsor. Pepsico and Kingfisher Airlines are the IPL's partners for tournament official beverage and advertising on Umpire's clothes respectively. The revenue from the all above sponsorship rights have been described as Central Revenues with a proportion of 40% to IPL, 54% to franchisees and 6% to prize money. After year 2017 the share proportion would be 50:45:5 respectively.

* The franchisees, apart from the share in central revenues, can earn money by franchisees rights like by selling advertising space in stadiums, by licensing products for their teams like T-shirts, advertising on tickets and gate money. The 20% of the amount earned in this head would go to the IPL.

* Each player of the eight teams would get their annual contracted fee in full that means the tax on that amount would be paid by the team owners. Apart from the above amount they would also get a daily allowance of Rs. 4,000 for the entire IPL season that would last for a month-and-a-half.

For more information regarding the each individual player's bid value follow the link.
IPL info