The threat of Corona Virus is looming large across the globe and new cases are being reported every day. The death toll related to the virus outbreak across the globe surges day by day. There are at least 30+ suspect cases in India now, and more and more are getting reported every day.
In India many big-ticket events are being canceled due to Corona Virus, across the globe we are seeing this phenomenon. Sources predict huge losses for the airline industry, hotel industry and also the advertising industry. Conferences, conventions, festivals and sporting events are getting cancelled or postponed everywhere in the world. Tokyo Olympics slated for July this year, is staring at a cancellation, MWC (Mobile World Conference) which was to be held on February 24-27 got cancelled. Facebook Global Marketing Summit scheduled for March 9-12 in San Francisco has been cancelled The Association of Southeast Asian Nations (ASEAN) was set to have a special summit March 14 in Las Vegas, with President Donald Trump in attendance, The White House has announced the cancellation of the summit. India’s biggest advertising Fest “Goa Fest’ has been indefinitely postponed and yesterday even FICCI FREAMES 2020 got added to the expanding list of cancellations.
But one event IPL, which begins on 23rd of March, is not being called off, why?
The matches are played across the country and it attracts huge footfalls at every venue and recently they have opened up Fan parks in smaller towns. The matches are being hosted in 9 venues this year Mumbai (stadium capacity 33,000), Bangalore (35,000), Chennai (50,000), Delhi (41,000), Mohali (26,000),Guwahati (40,000), Jaipur (25,000), Kolkata (68,000) and Hyderabad (55,000) Additionally 21 states will have 36 Fan Parks, each hosting 10,000 spectators at a stadium like venue.
The PM and HM this week had tweeted about not participating in Holi festivities and also mentioned that it is advisable to reduce mass gatherings.
Narendra Modi (@narendramodi) tweeted at 11:33 am on Wed, Mar 04, 2020:
“Experts across the world have advised to reduce mass gatherings to avoid the spread of COVID-19 Novel Coronavirus. Hence, this year I have decided not to participate in any Holi Milan programme.”
Amit Shah (@AmitShah) tweeted at 1:02 pm on Wed, Mar 04, 2020:
“Holi is a very important festival for we Indians but in the wake of Coronavirus, i have decided not to participate in any Holi Milan celebration this year. I also appeal to everyone to avoid public gatherings and take good care of yourself & your family.”
But BCCI and Star TV the broadcasters don’t seem to be worried, looks like for them the Show must go on. The question mark here is who will take the call. The BCCI? The franchises? The players? The broadcaster? The fans? Twice in the past, when the IPL plans were impacted, the government stepped in to solve the crisis. The IPL was played oversees twice, once in 2008 and in 2014 due to the general elections as the system couldn’t provide adequate security at the matches. With the coronavirus outbreak being a global issue, even shifting the matches oversees looks difficult.
Commercial Impact:
Let’s explore the scenario as to which are the parties that would be affected if the IPL is called off.
The BCCI has earned massive sponsorship revenues from the broadcaster, the title sponsor and will also collect a fat franchise fee from the teams. The IPL is today valued at USD 6.7 billion, because of its immense popularity and viewership.
Star TV has paid Rs. 16,347.5 crores for the media and digital rights for 5 years of the IPL. Star TV needs to recover revenue of at least 20% at every IPL. Star TV has also sold out 80% of its inventory this year at a premium
Every franchise spends about Rs. 300-500 crores on players, support teams, logistics and more. Rs. 100-300 crores of this is recovered from team sponsors. Rest comes from stadium attendance and share of central broadcast revenues.
Each Franchisee has shelled out huge bucks in acquiring talented players this year. Chris Morris – Royal Challengers Bangalore (INR 10 Crore), Sheldon Cottrell – Kings XI Punjab (INR 8.5 Crore), Nathan Coulter-Nile – Mumbai Indians (INR 8 Crore), Piyush Chawla – Chennai Super Kings (INR 6.75 Crore) and Sam Curran – Chennai Super Kings (INR 5.5 Crore)
Star India, the broadcaster this year has secured Rs 700-750 crore worth of advertising from brands across the spectrum. Approximately about 200 brands advertise actively on the IPL which also includes the pay-outs to Star/Hotstar, crores are spent on promos, new campaigns, consumer offers, and in-stadia promotions among other things. IPL also attracts huge eyeballs on to TV and 462 million viewers watched the 12th edition of the league last year and Hotstar attracted 300 million netizens.
With so much at stake, the whole ecosystem surrounding the IPL is quiet. What happens if the government decided to step in as a precautionary measure ask BCCI to call of the IPL this year? BCCI so far has invested a lot in IPL, will it be ready for this and what about the broadcaster STAR TV, can it afford such a huge loss to its revenue in the beginning of the year?
Can the IPL be postponed? That will be a huge logistical nightmare and the availability of players will be a question mark? Can it be just a TV viewing spectacle this year, to minimize the risk??
MediaNews4u spoke to a few consultants on what are their thoughts on as to what would be the implications if IPL is called off
Karthik Srinivasan- Communications Consultant said “Because they perhaps put money over everything else, I guess. It’s always a choice. Many large scale events across the world have been cancelled leading to a lot of loss for the organisers. But the organisers did what was right as per the situation, looking at the larger picture. IPL has historically always been about a garish display and indulgence of money, so it’s not surprising that they chose this option.”
Naresh Gupta – Co-Founder and Head Intern at Bang In the Middle said ” IPL is still sometime away, the immediate concern should be the South Africa Series that India plays right now with the infection at its peak. This series is in greater danger than IPL. I think it may be slightly early to take a call on IPL. The call has to be judicious. If the outbreak spreads to more cities than there would be no option but to cancel, but if the infection somehow gets contained then there may be no threat.”
Mukund Setlur Said “The current situation is that we have only about 31 cases wherein people have tested positive. Having said that there new issues in terms of ground revenue as people would not want to venture out because of the current scenario. They would prefer watching the same at home which will anyways help in reaching out to the maximum audience.
As the same is at the end of the month it would depend entirely on how the situation is and above that State & Central Governments have taken this as a serious epidemic… Situation may improve at the end of the month. The organisers may decide to shift venues. For example: Delhi wherein maximum cases have been reported.
The euphoria for IPL still stands… But as per current scenario the on-ground matches ticketing revenue would definitely get affected.”
