On Tuesday afternoon, one could sense a collective sigh of relief within the corridors of the Board of Control for Cricket in India (BCCI). For one, after the Chinese mobile giants, Vivo pulled out of the Indian Premier League (IPL) title sponsorship deal with the BCCI, it was staring at it’s dwindling coffers.
The title sponsorship deal with Vivo stands at staggering 440 crores per campaign and it would take only a great escape to navigate through the potential financial jolt. The wagers for the IPL matches for the upcoming season can be placed here.
As the IPL Governing Council (GC) chairman Brijesh Patel confirmed on Tuesday that Dream11 has won the bid to be the title sponsor for IPL 2020, it must have felt like a redemption of sorts for the BCCI.
Dream11’s winning bid of Rs 222 crore per season is only half as good as to the Vivo deal, but as they say-half a loaf is better than none!
A few weeks ago, with the situation looking bleak-investors and analysts were predicting a washout year for the cash-rich IPL. But as a saving grace, the BCCI is rather looking at the scenario in a positive way. After all, considering the market scenario during the pandemic, it must feel like a mighty windfall for the BCCI. Dream11’s winning bid is valid till December this year.
“Because the time to find a replacement sponsor was short and the market is reeling under the COVID-forced economic distress. “In a short time, we are happy that we have got Rs 200-plus crore because this is only for this IPL and the contract is valid till December. I think it’s a good bid,” Patel enthused.
About Dream11’s bid
The fact that bid-winners, Dream11 are willing to shell out Rs 220 crores indicates that they are confident of their finances at a time when it has been talking to investors for a large funding round.
Bankrolling the IPL is a bold move but not unexpected from an entity in a booming online gaming industry-witnessing rapid growth over the past couple of years.
The fantasy gaming platform now has over six million users to date, creating a niche for itself in the domain. It has been associated with the IPL as well as the International Cricket Council (ICC) in the form of an associate partner.
The online gaming industry has had to fight a legal battle for acceptance after a PIL was filed claiming it is a gambling platform. It was only last year that the court ruled in favour of the company.
Moreover, the Fantasy gaming industry only springs to action during a major sporting event. With tournaments like the World Cups and regional championships provide the platform to rake in a large chunk of revenue.
With an array of top investors across the globe, Dream11 is one of the most stable and thriving start-up ecosystems. In former India captains Mahendra Singh Dhoni and Sourav Ganguly, the company has ideal brand ambassadors to capitalise on the cricket fan market across the globe.
Dream11 allows real-money gaming, creating pools based on the outcome of the match and picking specific players and teams accordingly across sports, though cricket is its largest segment.
Dream11 wins IPL 2020 title sponsorship for Rs 222 crores: IPL Chairman Brijesh Patel
— ANI (@ANI) August 18, 2020
BCCI’s financial implications
In a time, when the financial clout is a global phenomenon, the IPL comes with a truncated budget for the BCCI.
In addition, playing the tournament away from India will have an increase in the overheads, including additional expenses for creating the bio-security, with sponsorships taking a beating. Given the fact that the franchise already is set to lose out on the matchday gate income, the added burden will have its consequences, with a few owners hoping to just break even this year.
The word is that the overall sponsorship revenue may come down by 10-15 per cent. The revenue-sharing agreement between the BCCI and the IPL team owners stands at the owners get half of the income from the central rights, which include the broadcast, title and other sponsorship deals. This means Rs 111 crore will be split between the franchise for this season.
Extraordinary times call for extraordinary measures and the team owners must brace for the financial upheaval with a sense of consolation.