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IPL 2020 fate in balance, economic consequences begin to be felt

(Photo by Robert Cianflone/Getty Images)

The Board of Control for Cricket in India and franchises in the Indian Premier League are meeting on Tuesday to explore the possibilities for completing the 2020 season, which is currently suspended until April 15.

Website InsideSport.co reported that the BCCI is considering various options for this year’s IPL, including running a truncated league in April and May, or June, and a fully-fledged one between July and September. Playing the league overseas is also under consideration. A complete cancellation of the season is also a possibility. The teams are reported to be against a July-September competition, as it would coincide with the monsoon period.

However, a decision may not be made at the meeting in view of the rapidly-developing nature of the coronavirus epidemic. Mumbai, the centre of cricket in the country and the planned host of the IPL opening and final games, is under heavy movement restrictions.

InsideSport.co also reported that some IPL sponsors are trying to exit their commitments. At least two have written to franchises asking them to reconsider their deals. The website quoted a senior executive at one franchise saying: “At least one sponsor wants to come out of the deal. Several others want to renegotiate. This is not an abnormal scenario. It’s time for all associates to give confidence and gain confidence. Beyond the merits of our contracts, the management will do everything possible to ease the discomfort of all our sponsors.”

This season had been one of the best for the IPL in terms of teams selling out their sponsorship inventories in advance. Total sponsorship sales by the teams were Rs450-500 crore ($60-66m/€55-60m).

Many of the world’s biggest cricket stars will also suffer financially if the IPL season is cancelled. Fox Sports Australia reported that the 17 Australian cricketers due to take part have contracts worth a combined total of A$17.57m ($11m/€9.5m) this year.

Business valuation specialists Duff and Phelps said the value of the IPL ‘ecosystem’ would drop by between 10 and 15 per cent, or by between $700m and $1bn, should this season get cancelled. The company last year valued the league ecosystem – including its franchise teams – at $6.8bn.

If the IPL is run this year in truncated form, with half the number of matches, the value would be hit by $200m to $350m, the report said.

Another report last week, by news website Business Today, said the BCCI stood to lose Rs3,900 crore ($520m/€490m) from a cancelled IPL. This was made up of Rs3,270 crore from broadcast and streaming rights, and Rs600 crore from central and title sponsorship revenues.

The BCCI has already cut in half the prize money for this year’s competition. The champion will receive Rs10 crore, down from Rs20 crore last year. The runners-up will get Rs 6.25 crore, down from Rs 12.5 crore. The two losing semi-finalists will get Rs4.3 crore each, down from Rs 8.75 crore.