BCCI to earn more from the 11th edition of the IPL

The Indian Premier League has been one of the biggest sources of revenue for the Board of Control for Cricket in India (BCCI). The Indian board is all set to change the pattern from a franchise license fee system to that of revenue model sharing, which will improve its financial condition drastically.

As per the franchise license system, the franchisees have to pay the cricketing board 10% of their winning bid amount for the IPL franchises. For example, the Reliance Industries, who had paid $111.9 million are required to pay around $11.9 million every year, as part of the contract for each of the ten years.

In the latest system, the franchisees are requested to pay 20% of the earnings from the central revenue system and the local sponsorship, as per the agreement signed by the team and the board. Under the local revenue, the revenue from Stadium rights and sale of match tickets would be included.

“If an IPL team makes Rs 200 crore from central sponsorship and another Rs 60 crore from the local revenue stream, the board would stand to gain Rs 52 crore,” a source explained to the Times of India.

IPL Media Rights

The IPL Media Rights are also set to go under the hammer this time around after ten editions of the tournament, where the Sony Entertainment Television (SET) had the media rights to air the matches in India.

The franchise fee contracts were earlier set to the 40 Rs per US dollar, which has changed many folds since the year it was set. This will be due to a new exchange rate and also because of the decision that all contracts will be signed in Indian rupees henceforth.

“It’s a win-win situation for the BCCI. If the franchisees’ gross earnings go up, the board will gain too. This is the agreement which was signed 10 seasons ago and there is nothing that the teams could do. We have to share the revenue with the board as the BCCI too will give each team more than 6% from the media rights revenue (50 percent divided over the eight teams),” a team official said, while adding that BCCI should ideally have given 8 percent to each team.