Earlier this year, a Jefferies Note research had revealed that the Indian Premier League (IPL), one of the flagship properties of the Board of Control for Cricket in India (BCCI), was now duking it out with the big boys in terms of values. Purely on a per-match basis, Jefferies had estimated that each and every IPL game was worth north $15.5mn; putting it in second place behind the National Football League (NFL) in the US but well clear of the likes of the Premier League in the UK and the likes of the National Basketball Association (NBA) and Major League Baseball (MLB).
It kind of confirmed the rapid overall media rights deal the IPL had enjoyed since 2008, the inaugural edition of the league. To give a sense of perspective, for the first 10 years, the league’s media rights had, on average, sold for just over Rs 8000 cr for a 10-year cycle. The latest media rights deal was worth Rs 48,390 cr for five years. A manifold growth.
However, that’s just one part of the story. While the league has enjoyed outstanding growth from a media rights point of view, an under-rated success story because the league began at the height of the global financial crisis in 2008 and continued to grow even during a pandemic, the same cannot be held for player salaries.
In 2008, the salary cap per team was fixed at Rs 20 cr. Sixteen years later, it’s at Rs 100cr (ahead of the upcoming auctions, it could rise to anywhere from Rs 120cr to Rs 140cr). While the media rights deal has taken the elevator in terms of appreciation, the rise in player salaries is akin to an octogenarian taking the stairs. Here’s Jefferies from their report earlier this year. “Value of IPL’s central broadcasting rights has grown 19x from `5bn in 2008 to `96bn.”
Even as IPL players — capped and uncapped — become millionaires, the overriding sentiment is this. They are grossly underpaid, especially in comparison to the blue-riband global leagues, including all of the US’ Big Four (MLB, NBA, NFL and NHL), almost all the top five European football leagues and so on. IPL cannot even argue about the existence of a hard salary cap because US leagues also have that but they have found no problems when it comes to paying players the accepted industry standard.
The accepted accounting practice, when it comes to elite sporting leagues across the planet, is to pay the players 50 paise per every rupee the league in question makes. According to the Statista numbers (2023), this figure is at 18 paise per every rupee the IPL makes. How do the big leagues compare? The EPL stands clear at 71 paise while all of the Big Four sees players making roughly 50%.
Statista even put another set of numbers to drive home this unique disparity which exists in the IPL when compared to some of the other monied leagues. When you consider share of wage costs to total revenue, the IPL again lags comfortably behind (some of this is because IPL finances are structured in a completely different way than other truly global leagues).
One cricketer who addressed the issue of players not getting fair value was R Ashwin in his own YouTube channel. But he focused purely on the RightToMatch aspect than taking a broader perspective.
One reason why players operating within the IPL may not be able to get their true market value is because the concept of collective bargaining is non-existent within the Indian sporting ecosystem. It’s truer especially in a sport like cricket where true power lies with the governing body than with the players.
Cricketing bodies representing players like the Federation of International Cricketers’ Associations (FICA) have noted that IPL and Women’s Premier League players are underpaid but they cannot do much.
“Players love playing in the IPL but there’s no doubt that if you look at it comparatively,” Tom Moffat, CEO of FICA, had told Telegraph in an interview last year, “as a percentage of overall revenue that the league generates, overall player payments are well behind other analogous sporting leagues.
‘... we look forward to continuing to see the IPL and WPL be successful and to players being paid fairly and proportionately to their contribution to the success of these and other sporting leagues around the world.”
At the end of IPL auction in 2023, Mitchell Starc became the league’s most expensive player when he was signed by Kolkata for Rs 24.75 cr. If the Australian was paid industry standard money, he would have taken home many more crores. And the same would have been applicable for a lot of his peers as well. This may not change in time for the next auction. And the auction after that. And the auction after that. And the auctions after that...