Coronavirus pandemic: IPL 2020 may get cancelled or postponed, crores at stake

By Maryam Farooqui

The question of IPL getting cancelled arises as many major sporting events are getting cancelled globally due to coronavirus.

A cabinet meeting on March 12 will decide whether to postpone the Indian Premier League (IPL) or to cancel it in the wake of the coronavirus spread in India.

The question of IPL getting cancelled arises as many major sporting events are getting cancelled globally due to coronavirus. National Basketball Association (NBA) has also suspended its season after a player tested positive for coronavirus.

Similarly, uncertainty looms over IPL due to the outbreak.

In both the cases, cancelling or moving the date of IPL 2020, will mean a big blow to BCCI (Board of Control for Cricket in India), media and digital right holders Star Network, sponsors, among others.

In fact, experts say that postponing the tournament looks difficult as the cricket annual calendar will not again have a clear six to seven weeks window that the IPL requires.

Also, no foreign players will be available until April 15 due to visa restrictions.

In case of cancellation, there is a lot at stake.

After all, the IPL is a big sporting property which is currently valued at $6.7 billion, said Sandeep Goyal, Chairman - Mogae Media.

He also thinks that BCCI has invested too much in the cricketing event.

It already has sponsorship revenues from the broadcaster in its pockets. Plus, the title sponsor and franchise fees from the teams will fetch BCCI a big amount, he said.

Along with the BCCI, a lot is riding on IPL for Star TV which has paid Rs 16,000 crore for the media and digital rights for five years and needs to recoup at least 20 percent of that amount every season of IPL, he added.

Franchises also spend good amounts on players, support teams, logistics among others. All of this could cost around Rs 300-500 crore and out of this Rs 100 to Rs 300 crore is recovered from sponsors for a team. The remaining amount comes from ticketing revenue and share of central broadcast revenues.

“Ticketing revenue is about Rs 400 crore, according to estimates from past data. Plus, there is about Rs 50 crore that comes from the fan parks,” he said.

Sudhir Kumar, Director - Offline Media, DCMN India said that there will be five percent to 10 percent impact on on-ground revenues due to the virus. This is only if IPL remains on schedule.

And, then, there are brands who leave no stone unturned to advertise during IPL.

Around 200 brands advertise actively on the IPL and for this edition 70 percent to 80 percent ad inventory is already sold, said Goyal.

He added that typically the channel liquidates the rest of the ad spots closer to the matches, especially after the elimination rounds. “Normally such inventory fetches some premium, especially if the tournament has been controversy free,” he said.

Kumar added that so far there has been no reduction on ad rates and no sponsor has backed out. Plus, Star has chances to touch or exceed Rs 3,300 crore in ad sales this year.

“As long as the event is staged as a screen spectacle with no fear of untoward happenings caused by the virus in a packed stadium, sponsor interest will remain high. A number of brands keep their marketing arsenal dry for many months in advance to peak communication during IPL and load on offers, promos and new launches,” said Goyal.

But, with more coronavirus cases being reported in India, there remains no certainty about IPL 2020.

Cancellation and rescheduling the only options left.

According to Goyal, there’s one other option.

He says the IPL 2020 could be a TV and digital-only tournament.

As many as 462 million viewers watched the league on TV in 2019. Star’s digital property Hotstar witnessed 300 million viewers coming on to its platform to watch the game.

“The viewership for IPL has been going up almost YoY. Part of this is because of greater viewer interest and enhanced female viewership but a lot also has to do with local language feeds especially in the south,” said Goyal.

Kumar also thinks that television viewership for IPL 2020 will be more than last year, only if the league remains on track.

Star has plans to air few IPL matches on Star Gold and Star Plus and this will mean a bigger viewership base for the league this year.

However, IPL 2020 which is slated to start from March 29, its fate remains unknown as of now.

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