Vivo withdraws from IPL as title sponsor for 2020: How will this affect the franchises?

Amid the backlash against Chinese companies in India, Vivo will not be the title sponsor of this year’s Indian Premier League (IPL)

Vivo had secured the IPL sponsorship rights for 2018-2022 for nearly Rs 2200 crores.

The BCCI and the franchises will face heavy financial losses this time around for a number of reasons compared to previous seasons.

Impact on franchises

Vivo was paying Rs 439.8 crore per year to BCCI as sponsorship commitment. The total revenue from the central pool is distributed between the BCCI and franchises in a 60:40 ratio

While the Indian board gets Rs 220 crore, the 8 franchises divide Rs 220 crore among themselves, with each getting about Rs 28 crore every year

Times Now reports that for every match that takes place at the home ground, the franchises would earn Rs 3 to 3.5 crore but now as the IPL is being held in UAE, the overall loss will be to Rs 21 to 24 crore for the season in terms of gate revenues only.

According to Indian Express, Vivo, in all likelihood, would seek a one-year moratorium in its sponsorship commitment, keeping the door ajar for a 2021 return. So, the Board will have to find a short-term replacement sponsor.

Also, BCCI claims, the franchises will be losing out on revenue of INR 50 crore on an average in total this season. However, Some of these losses, can be cut if the BCCI manages to strike a good sponsorship deal with a new title sponsor in the coming days.