IPL Will Be No.1 Sports Property In The World: Lalit Modi
The former chairman of the franchise cricket league added that he believes that IPL media rights valuation will double again in the next cycle.
Days after the BCCI bagged a whopping amount of over Rs 48,000 crore for the Indian Premier League (IPL) media rights for the 2023-27 cycle, former IPL chairman Lalit Modi, in an exclusive interview to NDTV, said the IPL will become the No. 1 sports league in the world. The former chairman of the franchise cricket league added that he believes that IPL media rights valuation will double again in the next cycle.
Here's an excerpt of his full interview.
Rica: This week, the BCCI hit a jackpot. the IPL media rights were sold for an astronomical sum of 48,000 crore. the billion dollar baby (IPL) is a billion dollar teen now. how would you describe the evolution?
Lalit Modi: it was always going to be lucrative, but viewership is the most important thing. that is how we become lucrative. the viewership is now also probably the highest in the world per game. i have always maintained that IPL is recession-proof. as far as India is concerned, and we have got newer and newer fan bases joining in. but we have to be careful going forward, because the younger generation are very discerning, and they're mostly on digital. that's why you see digital rights have gone up tremendously in price. but their experience has not been good in India today, as far as being able to watch it on a particular platform. the jio platform is not very user-friendly at the current moment. when you turn the phone around, from horizontal to vertical position, it doesn't capture that, and it loses the faith in the fans, and they are really disappointed from when I talked to them.
Rica:IPL has been your passion project. the league has been attacked for corruption, spot fixing, teams have even been banned. do you think IPL has now been able to do a clean-up act?
Lalit Modi: it has. it has really been able to do it, and it is moving in the right direction. the Gujarat Titans' first season win it has shown that there is faith now in the game, and there is no fixing anymore. it has taken a new turn, and I have always maintained that Ahmedabad is one of the key areas, and i have been trying to get them into the system for a long time, but I'm really glad that Ahmedabad is now in it, and they have performed outstandingly in the past series.
Rica: And why would you say so, that Ahmedabad is key?
Lalit Modi: i remember we have always maintained from the day 1 that the Gujarat population has been very hungry for the game. when we had, in season 3, split the Rajasthan royals game between Gujarat and Jaipur, the viewership in Ahmedabad had really taken a big hike in IPL. and the fans were really hungry out there. you've got to understand today, as we sit here, to watch the game, the Narendra Modi stadium that has been built in Ahmedabad is absolutely world-class. it has shown the world that we can actually build world-class properties. and this is the most disappointing thing for me right now. in 15 years the IPL has contributed hundred thousand crores to the BCCI in total. 58,000 in the last year alone. 50% of that money has been made for the BCCI, 50% is shared by the IPL franchise, as an example. what has BCCI done to encourage infrastructure? you look at Kotla. they should demolish Kotla. they should demolish most of the stadiums and build fresh. you can put world-class infrastructure- air conditioning, good toilets, good hygienic eating places, good viewer experience, better seats, getting in and out of the stadium, car parks. you can go underground, you can build big, but you need to put that money in and build world-class stadiums. 80% of the money that goes to the BCCI is passed out to the state association. BCCI should mandate this. and this is not what is happening.
Rica: When IPL was sold in 2008, matches went for Rs 13.6 crore rupees, today each match is being sold for 118 crore rupees. how much credit would you give the current BCCI dispensation for fixing the kind of valuation?
Lalit Modi: it is not them. it is the fanbase that has done it. i have always said every 3-4 years it will double. the price of IPL will continue to double in terms of media rights. and it's gone up by 98% in the last cycle. from the last cycle to this cycle at 98% and I'm telling you now, going forward in the next cycle, it will double again. it's not the dispensation or the management, it is in the star base. it is the fanbase that dictates the pricing. the broadcasters are not foolish enough to shell out this kind fo money if they're not going to recover it. there may be a loss in year 1 or so, but not going forward. so i think it is the fans and only the fans that dictate the terms.
Rica: IPL has now become the no. 2 league in the world. how much time do you think it will take to overtake the NFL and become no.1?
Lalit Modi: it will definitely overtake NFL, I've always said it'll be the no. 1 sports league sooner rather than later, but it all depends on the innovation for the OTT platform, the digital platform. if we are able to get our act together on digital, you will see digital overtaking television in terms of viewership, in terms of revenue, immediately. i think digital rights will go 3 to 4 times that of television in the next cycle. a lot of money has to be spent on technology, on digital platform, on viewer experience. there has ti be more cameras, the feed has to change. you need to have drone technology. you need to put the drone technology in, artificial intelligence. ai is another area that needs to be focused on. all of these technologies will make the consumer experience better. if the consumer, the fan, can choose which camera to watch on a digital hand screen, it will take the revenue up, it will take the experience up. but right now, we're not geared for that. with all the money we are making, i think a lot of it needs to be spent back in making sure the digital experience is better.
Rica: I have to ask you about the man Lalit Modi who was expelled from BCCI on grounds of have taken a facilitation fee, cleared by the Bombay High Court. what is now coming in the way of your returning to India? is it politics?
Lalit Modi: no, no, no politics, i am very friendly with the government, i have no problem, i have no cases at all. I'm really happy it has taken a long time for it to clear. finally my name has been cleared as far as the court case is concerned. there is still the fir in Chennai, which we're trying to get cleared off. once that clears off, i will be back in India. I don't want any lingering issue, of any court saying that i have a single case. but they won't publish the judgement. somebody's stopping the judgement in Chennai, I don't know who! i have a copy of the fir report, which cleared me also. but there's still the hanging sword in Chennai. my lawyer Mr. salve won't let me go until that is cleared. we're hoping to file an application to see if we can get it done through the supreme court, but we are not getting any luck from the high court.
Rica: so we might see Lalit Modi back in India very soon?
Lalit Modi: I'm hoping. I miss India very much, and I'm looking forward to that.
Rica: okay now let's talk a bit about IPL numbers. 48,000 crores, crazy numbers. give us the breakdown, how can the media rights owners recover the money?
Lalit Modi: see, the digital rights are an investment this year. they are an investment for the digital companies who have gained the rights. if they create the user experience that I'm talking about, artificial intelligence, number of cameras, the viewer can choose what he or she wants, it will help them recover. people today, the younger population is very discerning. they don't want to watch the full game. they want to watch parts of the game. they want to watch stories, they want to see funny things, they want to see incidents that take place. they want to pay for that, they don't mind paying for that. and in terms of numbers, it is called the generation z, in the use there are 68 million z generation people. that accounts for probably 80% of the digital rights for any product. in India, you will be surprised to know, we have 256 million of those generation z people. they are the future of the viewership going forward. they are not the people who are used to watching on television. they probably don't even have a television. what they do have is their computer or their mobile phone, and that's what they watch most of their entertainment on. that is where the fruit lies going forward. television will continue to grow because of the number of eyeballs per ten second rate will increase dramatically, as it has done over the last year, and i don't see that as a problem because it's prime time viewership. you know i heard some report that the ratings were down over Covid. now, when you had Covid times, you have to understand those are extraordinary times. everybody was sitting at home and doing nothing. so IPL was like a boon to them, when they had nothing to do. but non-Covid times, when people have other jobs to do, that's what i said. people don't have the luxury of sitting and watching the whole game, because the younger population is always mobile, on the move. they need to have their experience on their phones. that has not been captured on viewership data. if we capture that data of the past yearly, i think the viewership will be already high.
Rica: The digital rights went for 23,758 crore rupees. that is probably 7.8 times what it went for in the past. do you think this money can be recovered through subscription and advertising?
Lalit Modi: money won't be recovered in the first year, but it will definitely be. I've been only talking about that. digital rights are the future. the future of television globally in any product is digital rights. that is where younger population is, where generation z is. but will they do that? it depends on the platform, and i think jio is a very strong platform. it has got good muscle power in terms of subscribers. also it has a big war chest of money to be able to do that. so i think it's the right company. I've always wanted to see Mr. Ambani get into this, and i think this would be a major area of their revenues going forward. if you look at 2009, 2010 actually, when i went for the ipl fantasy with YouTube, i went to google, and i started the IPL fantasy with them. they had no idea what we were talking about. but then I had my team create an IPL fantasy, following the players 24/7. this is what's going to happen in the future. back then data streaming was very expensive. today data streaming is virtually free. that's what people are living on. and going forward, because we have the bandwidth, 5g has come in, it is going to be the solution for the revenue. unless you have 5g for the data streaming, it will be very difficult for a 4g platform to stream the quality that will match the tv.
Rica: there's a lot of talk that India is going the England way. while we have the best t20 tournament in the world, we are not winning ICC trophies since 2011, like England having the EPL but not winning the football world cup. what do you have to say?
Lalit Modi: i don't understand why. is it a morale issue, is it a selection issue, i don't understand. we have the best players in the world. if you look at it, our bench strength in cricket is world's best. are they getting hiccups? are the team owners managing their players better than the BCCI managing its players? this is the question that should be understood. i haven't actually focused on that, but hopefully, by our next interview, i will start focusing on that area.
Rica: also there is talk of having a two and a half month dedicated window. would that not be an overkill? already there is a fatigue that sets in every year, in the middle of the IPL season.
Lalit Modi: I don't think we would have fatigue because the number of teams are going up. every football season is long, but it is not continuous, like we have in the IPL every day. i think a good solution would be to spread the season, which we were looking at earlier. taking the champions league season and using that as a culmination. club cricket is here to stay, and unfortunately, it will be to the detriment to national cricket. i think the BCCI and the world cricket body should look at definitely trying to get cricket into the Olympics. that would have a great effect on the people of the country because we would hopefully be able to get a gold medal out there. I don't know why they're resisting that. i mean, India should support it because India doesn't need the ICC revenues anymore. the IPL revenue is far greater than anything else they could dream of, but other countries might object to it because their revenues are not very good, and their majority revenue is still coming from the ICC. ICC used to be the no. 1 source of revenue in the past, that is no more is that the case. IPL will dictate and continue to dictate, going forward, the rule of the game in terms of viewership and in terms of revenue. if you pay your players high, they're going to be more loyal to you than they are going to be to their country. they may say what they want in an interview to sound nice, but ultimately it's the bank balance that dictates whatever it is, whether we like or not.
Rica: it is interesting that you spoke about cricket in the olympic games. this year, cricket is getting into the commonwealth games, the women's team is going to be there. would you say that's a good first step?
Lalit Modi: amazing, amazing step, and i think that's great. it'll be a big boost to the women's game, and I'm very glad. i haven't seen much of IPL women's games this year, but i think what they should do is make it mandatory for an IPL franchise to have a women's team. if an IPL franchise owner is able to have a women's team, you will see a bench filled with Indian women. you'll see it as a good investment made by the cricket owners, who are already making good money now. IPL is probably the only league in the world where every team makes money, barring the two new teams. but the old eight teams, have profits. they have no infrastructure cost. infrastructure cost is the single largest cost of most teams in the world. Chelsea team's infrastructure cost is very large. here, when i planned the league, i said there is no need for infrastructure. infrastructure should be the problem of the BCCI, they already have infrastructure. why not use it at a pay-per-day case. but that infrastructure needs to be upgraded. that will help the franchisee have a zero cost on the balance sheet. and that is why they're making a lot of money. now they should take that money and groom women's sport, not only for the women but for the fans also. BCCI should give it free to all the franchisees today, say you can have an IPL women's team free, we don't want a license fee. but encourage them to pay their players, to get the women in, to start the coaching process and get them on. there may not be televised games but they can go on digital platforms. definitely that can be another boost to the digital rights holder. when i launched IPL in 2001, there were no buyers for international rights, especially in England. so what happened was, when i went to sky tv, they didn't want it. i went to ITV, and i said I'll pay you a million dollars just to show it. they were very happy that we were paying them. i said, don't worry, we'll get it back in year 2 or 3. the next year, they paid 11 million dollars. so when you're paying for something, you're so confident of your product, that you know you'll get it back anytime soon, that is what they need to do.
Rica: there's a big concern whether test cricket will survive the global t20 onslaught. few other leagues are waiting to be launched, ICC is set to release its ftp in July. tell us what are the biggest challenges facing the ICC right now.
Lalit Modi: it is a very big challenge. test cricket is a very important part of cricket. i have always been maintaining, you need to change test cricket from a day game, to a day-night game. you need to make it in the evening. why? because people are going to offices, people are working, and youngsters are not interested in a five day game, sitting in a stadium. but if you made it in the evenings, made a four o'clock start, till ten o'clock at night with the lights, you would see a lot of people interested and going to the stadium after five o'clock office hours. have to make the user experience in the stadium more family-oriented, more user-oriented, there needs to be drinks and food, and entertainment, and more importantly, hygienic toilets. i think the worst hit will be the fifty-over game. i think that will over time phase out. i think it'll be twenty-twenty and test cricket that's going to be there going forward.
RICA: that's an important prediction you're making. 20-20 and test cricket that will remain ultimately. coming back to IPL, you know about the spot fixing scandal in IPL, you have said that BCCI has done a clean up act. there was a Lodha reforms and the reforms came into play in 2015. do you think Indian cricket has changed?
Lalit Modi: i am looking here for at broader picture, you've got to understand to do fixing you need to be in the system for a long time. I'm taking the example of Gujarat and Lucknow, they got into the fray one month before the IPL started. they went on to win from day one. that means everybody who tried to fix the game couldn't fix it.
fixing has been rife in the past and you can see that in the results. but i think this year was clean. i won't name any team that has done badly or not done badly and who were fixing in the past. i think today it shows that the system is better, the police have also acted very informally
but I'm a little shocked to hear that the ICC anti-corruption unit is not that active in India.
i don't understand why the international corruption unit should not be there. if you had to pay a little bit extra why not?
secondly, for the first time I noticed two Indian empires on field.
we never had that in the past in IPL, there was a reason for that. this is a very important issue and it will come to haunt us in the future I'm going to tell you right now.
if you want to see whose pocket is the money in, don't look at the BCCI accounts go to the state association accounts. look at those, scrutinize those. that is where the problem lies. there's no audit on the state association. they are getting hundreds and crores of rupees a year where is the money going?
Rica: There have always been talks of Indian cricket being called a cozy boys club for sometime now, but if you were to describe it, what would you call it?
Lalit Modi: I was hoping that it would change, but it hasn't changed. The Supreme Court had passed a rule of nine years. i think they're finding various excuses to overcome that to shut that. It's still a cozy boys club. they think they made too much money. but guys they don't understand who made it for them. I'm happy about it I'm very happy with doing that. do something with it, you can do something with it you have the responsibility to do something with it. I'm saying about it because I created it. You show me something that you created.
Rica: Well we'll have to get back to that Virat Kohli word ‘intent'- do they have it? that is the question. Lalit thank you very much for joining us. hope to see you back in India very very soon thank you
Lalit Modi: thank you