The kind of hype and money generated by Indian Premier League (IPL) is simply astounding. Even better, it is becoming a classic case of Bollywood and Cricket merging to propel Indian sports towards the league of really big bucks. But are things as rosy as they look?
Everybody knows about how Sania Mirza has taken the ‘business’ of tennis to new heights. The humble yet brilliant Vishwanathan Anand routinely earns crores every year through chess matches. Others like Jeev Milkha Singh (golf), too, have become dollar millionaires. So, as the Indian economy gallops ahead at a scorching pace, sports is also becoming big business.
But one thing is unmistakable. While sports like racing, football, golf and chess do have a bright future, it is cricket that rules as the unchallenged emperor. Says Amita Sarkar, Head, Media & Entertainment division, FICCI, “No other sport can match the popularity of cricket in India. The other sports have a future, but it is a long way from now.” Just look at this comparison: When the Indian hockey team won the Asia Cup, they got piffling money rewards while when India won the first T-20 World Cup (cricket), Dhoni and his band of merry boys were showered with cash prizes, which also resulted in protests by the hockey players for a stepmotherly behaviour.
Amidst all this hype, hoopla and media frenzy, one question that keeps cropping up repeatedly is: Have people like Shahrukh, Preity, Mallya and Mukesh Ambani made a wise decision by investing such huge amounts in teams and players? And will they be in a position to recover their investments in the future? Equally important, Sony has bagged the telecast rights of IPL for a mind boggling $1 billion. Will the channel be able to recover the money it has gambled on the new 20-20 format? If history is any guide, then the head honchos at Sony surely have some thinking to do. In an exclusive interview with B&E, Ashish Kaul, the then Executive Vice-President of Zee Network explains the economics of IPL and how tough it will be for Sony, “It is only BCCI who is going to make money out of IPL. By no means Sony or WSG will make money.
Everybody knows about how Sania Mirza has taken the ‘business’ of tennis to new heights. The humble yet brilliant Vishwanathan Anand routinely earns crores every year through chess matches. Others like Jeev Milkha Singh (golf), too, have become dollar millionaires. So, as the Indian economy gallops ahead at a scorching pace, sports is also becoming big business.
But one thing is unmistakable. While sports like racing, football, golf and chess do have a bright future, it is cricket that rules as the unchallenged emperor. Says Amita Sarkar, Head, Media & Entertainment division, FICCI, “No other sport can match the popularity of cricket in India. The other sports have a future, but it is a long way from now.” Just look at this comparison: When the Indian hockey team won the Asia Cup, they got piffling money rewards while when India won the first T-20 World Cup (cricket), Dhoni and his band of merry boys were showered with cash prizes, which also resulted in protests by the hockey players for a stepmotherly behaviour.
Amidst all this hype, hoopla and media frenzy, one question that keeps cropping up repeatedly is: Have people like Shahrukh, Preity, Mallya and Mukesh Ambani made a wise decision by investing such huge amounts in teams and players? And will they be in a position to recover their investments in the future? Equally important, Sony has bagged the telecast rights of IPL for a mind boggling $1 billion. Will the channel be able to recover the money it has gambled on the new 20-20 format? If history is any guide, then the head honchos at Sony surely have some thinking to do. In an exclusive interview with B&E, Ashish Kaul, the then Executive Vice-President of Zee Network explains the economics of IPL and how tough it will be for Sony, “It is only BCCI who is going to make money out of IPL. By no means Sony or WSG will make money.
Source : IIPM Editorial, 2012.
An Initiative of IIPM, Malay Chaudhuri
and Arindam Chaudhuri (Renowned Management Guru and Economist).
and Arindam Chaudhuri (Renowned Management Guru and Economist).
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