Bulk ad rates for IPL 4 still high, but some sponsors say may renegotiate contracts.
In a temporary reprieve to the Kochi franchisefor the Indian Premier League (IPL), the Board of Control for Cricket in India (BCCI) today gave a 30-day window to the owners to sort out differences and work out a shareholding structure. But it also yielded the knife saying the franchise would be cancelled if it failed to submit satisfactory replies.
In a day of hectic developments, the Bombay High Court today admitted a case filed by Rajasthan Royals against the termination of its franchise by the board and adjourned the hearing till Friday.
However, even while questions are being raised on the future of the fourth edition of IPL to be held next year, some advertisers and sponsors are backing the league and say the current imbroglio will not impact the business.
BCCI President Shashank Manohar today confirmed: “The Governing Council received replies from both the parties, the Rendezvous group and other co-owners, and the board felt that the dispute still exists. In case they don’t remedy these disputes within 30 days, the franchise will stand cancelled.”
The council convened an emergency meeting in Nagpur today to discuss the replies it had received from the owners of the franchise. This is the second time that the Kochi franchise has been given time to set its house in order .
The move was welcomed by the owners. “Despite our problems, we have been given time. We are extremely grateful to BCCI. We are sure we will be able to sort out the differences,” said Satyajit Gaekwad, CEO Rendezvous Sports, which is one of the owner of the Kochi franchise.
However, despite the ongoing uncertainty, sources within SET Max, the official broadcaster of the T20 tournament, say at least 70 per cent of the ad space has been booked already for IPL 4. Key advertisers like PepsiCo, LG, Samsung, Hyundai, Videocon, Vodafone, Airtel and the Godrej group have already been roped in.
A SET Max executive said bulk ad space at the moment were being sold for Rs 5 lakh for a 10-second spot, which will go up to Rs 6 lakh on spot buying. According to one media agency head, who did not wish to be quoted, IPL is the most premium slot at this point, delivering ratings of close to 5.2. “Advertisers can’t afford to be off this no matter what happens off-field. For three years, IPL has been conducted despite hurdles. The fourth season will also happen,” he adds.
Many believe the brand value will not get eroded. Says Future Brands CEO Santosh Desai: “The brand value of IPL is not likely to suffer immediately. Eight teams are still likely to play next year, which will be the same as that for the third edition. Viewership and advertising revenues are not likely to be affected.”
Key advertisers in previous IPLs are optimistic but more cautious. “We have not taken any decision regarding sponsoring the event next season. The fate of individual teams would not affect us. The number of matches played next year would determine viewership and that would be taken into consideration while deciding on sponsorships,” said a Samsung spokesperson.
However, close watchers of the game say with the court case as well as the threat to Kochi still looming large, the players’ auction for the fourth season of the tournament, expected in November, could now get postponed to as late as January. A senior executive of an IPL franchisee says: “The problem is that there is no slot in 2011, except February, for IPL, as the programme of the teams are chock-a-block and you have the World Cup. So any delay can jeapordise IPL. That is our only worry.”
A top executive of a beverage company says: “ Our contracts with teams are for three years but we pay them each year. Surely we will re-negotiate contracts if the number of matches they play is less.”
