The business of sports

Feb 28 2014, 02:56 IST
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SummaryThe league system has become an important way for companies to enter sports as it creates opportunities in franchising, advertising, broadcasting, licensing and merchandising.

The league system has become an important way for companies to enter sports as it creates opportunities in franchising, advertising, broadcasting, licensing and merchandising. The success of the Indian Premier League (IPL) has inspired creation of national and state level leagues in hockey, football, golf and badminton. However, most of these leagues are yet to achieve the scale and profitability of the IPL.

While sporting leagues in India have made sports more commercial, cricket has benefited the most. For IPL, the biggest source of revenue is media rights as Board of Control for Cricket in India (BCCI) has struck a nine-year long broadcast deal for R8,200 crore. While IPL is being supported by financially capable BCCI, the World Series Hockey (Bridgestone World Series) is facing trouble because of non-recognition of the Indian Hockey Federation as the official national sports federation. A KPMG-CII report has underlined that a young and growing middle class with their increasing disposable income offers huge potential for the business of sports in the country.

Viewership of sporting events has been steadily rising, which could create an environment conducive to sports commerce and encourage more firms to join sports league and sponsorships.

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