Cricket immune to market risks for now
Global markets are down. Investors are fearing a prolonged bear run. There is a crisis in the world of crypto with various currencies setting new lows on a daily basis. Retail inflation is still dangerously high. But even in this scenario, the Indian Premier League (IPL) is one of the very few products that continues to make money. Amid a never-ending Covid-19 loop in 2021, the Board of Control for Cricket in India (BCCI) rolled in the money as it welcomed two new teams for record sums.
Last week, its bet on investors lapping up an expanded IPL reaped rich dividends as the media rights were sold for an excess of $5 billion (`48,390 crore) for a five-year period from 2023. In terms of sporting properties across the globe, the figure the BCCI has managed belongs in the stratosphere—along with the biggest multi-discipline event (Summer Olympics), the most popular Cup competition in the world (FIFA World Cup), the most widely watched sporting league (English Premier League) and a few franchise leagues in the US(NBA and NFL), the country with one of the most developed media rights markets in the world.
Last week, however, also showed the challenges that do exist for the BCCI to keep the IPL media rights among the most lucrative in the world. Digital rights is now the kingmaker. In a country like India, that is not a surprise because of the ease of owning a smartphone. Couple that with the accessibility of cheap 4G and low subscription rates to OTT platforms, and it is a marriage made in heaven.
However, the money that came in from TV rights could be a red herring. If the market is maturing, they will have to squeeze more money via digital in the next cycle to continue this upward trajectory. There is also the one inherent problem that the IPL faces. For all the commerce, the sport has not grown outside the Commonwealth. That being the case, the board faces a battle to get hundreds of thousands of new fans every five years. That, however, is a medium-term problem. For the next five years, though, it will be one of the undisputed market leaders.