There is no business like Sport business. Once considered a small-time market with a relatively narrow appeal, it is now a thriving industry. Worldwide, sport is booming like never before, attracting global fans of all ages, incomes, ethnic groups and cultures. Industry management studies show sport is among the fastest growing segments in the entertainment and media industry.
Even as Indian sport aspires to global standards set by benchmark events in American pro sport, English Premier League and other soccer leagues in several continents, IPL season-5 is helping to raise the bar nationally. Cricket being the hottest property within Indian sport, it is helping to pit India’s highest paid sportsmen like Sachin Tendulkar and Mahendra Singh Dhoni among the unofficial list of rich athletes from around the world.
Cricket is not the only growing sport in India although it will always enjoy the first mover advantage. F-1, the world’s most glamorous motor racing circuit, welcomed India into its high-octane, high-decibel fold with the building of the Buddh track in Noida, near New Delhi. Private enterprise, a feature that enabled IPL to be different from the old honorary and amateur sports administrator-driven stereotype, shone here too with the Jaypee Group boldly spending about `2,000 crore to build the track, pay the licensing fee and make the formula work out here.
The Indian sporting scene is also bubbling over with a new energy. Critics may cavil at Salman Khan being paid `5 crore to shake his bod and his muscular arms at the IPL opening ceremony in the biggest show yet in the continuing Bollywoodisation of cricket. The mix of cricket’s magnetism allied to filmy glamour and business chutzpah is what has helped the IPL roll out its unique brand of ‘cricketainment’ that sent valuations of the league to as high as $4.13 billion in 2010.
Television channels, programme presenters, commentators, models, dedicated Internet cricket websites, memorabilia-driven auction websites and many other arms of business that are run indirectly by sport are all laughing their way to the bank. Sport has become a very valuable programming territory in which broadcasters battle for rights — India has two hot cricket properties both of which together are worth in excess of $2.5 billion translating to about $250 million a year to the cricket board.
Game-changing developments taking place on multiple platforms in American pro sport where visitor experience is enriched with video on demand and multimedia access on digital connectivity at luxury suite seats are driving revenues for clubs that are trying to bring down dependence on television royalty. A study by a leading consultancy house (AT Kearney) revealed the global sports business was estimated to be worth $400 billion at the turn of the decade. Worldwide, the professional sports industry is estimated to have generated direct revenues of more than $54 billion in 2001 and indirect sales from sports are estimated to be at least three times direct revenues.
Digital video and audio content, Interactive television, wireless transmission to smart-phones, archived videos and pay-per-view television operated by the clubs themselves are the future in sport through in-arena broadband connectivity. And sport is also fast moving on to the global fan, not merely those who can view the match in Manchester, New York or Mumbai.
Considering the earnings of the two highest paid cricketers in India in terms of endorsement contracts — Sachin and Dhoni — at least Sachin should make the world list of rich athletes somewhere behind the world’s top paid woman athlete, Maria Sharapova who at $24 million annual earnings is 29th on the list of 2010-11. Sachin’s earnings in the recorded sphere are at least $14 million in an annual endorsement contract with World Sports Group (`200 crore guaranteed for three years plus a premium for additional endorsements), $1.8 million salary on Mumbai Indians books and a further $1.5 million playing fees from BCCI. Where computing his annual earnings becomes tricky is some of the products he endorses may come with profit-sharing clauses that could take his valuations right up there into the top 20 in the world.
There may come a day when India too will have its sporting dollar billionaire. With estimated earnings set to soon cross `1,000 crore, if it has not already, thanks to years of endorsement contracts with Mark Mascarenhas of WorldTel that started at a game-changing `20 crore a year in 1996, Sachin Tendulkar is actually the first ‘Rupee Billionaire’ of Indian sport. And Dhoni, with his rock star lifestyle and his image that still beats temporary glitches in his Team India’s form, will not be far behind. Truth to tell, India is just about joining the open market of the world’s sporting economy.