LightCastle Analytics Wing
March 2, 2015

Is it the Beautiful Game or Just the Money?

The 2007 world cup was not a successful world cup by any means. The tournament dragged on for close to two months, a lot of unnecessary matches were played and in the end, Australia quite easily ran away with the trophy. However, the shock factor wasn’t the format or the lack of competition; it was India getting knocked out in the group stages, thanks to an emphatic victory by Bangladesh.

India was and is the golden goose of advertisement when it comes to cricket. With more than 1 billion viewers who watch or play the game, the advertisers understand the importance of India as a source of revenue. Hence, this World Cup format was revamped to ensure the big guns, mainly Australia, England, and India get to stay for a longer period in the World Cup, at least up until the quarter-finals, thus attracting higher advertising revenue. Although this raises the issue of fair play towards the teams on the lower end of the spectrum, the power of money and influence overwhelms the need for fair play and competitiveness.

Media and Sponsorship Rights: Play it in Millions and Billions

ESPN-STAR brought the broadcasting rights for nearly $2 billion to predominantly broadcast in the subcontinent, which comprises of majority of the cricket watching nation. The opening match of Pool B between India and Pakistan had 1 billion people tuning into their television sets, and hence the prospect of earning is significant. ICC expects a revenue generation of close to $200 million, the bulk of which will come from sponsorship and TV rights.

The earnings from sponsors are shared with member countries of ICC. The giants of the game – BCCI, CA, and ECB get the lion’s share of any revenue generated by ICC from major events. The income gap has become more prominent in recent years since BCCI contributes up to 75% of ICC’s expenses and also generates up to 60-70% revenue of ICC alone. The commercial pull that India and BCCI have also justified the revamping of the format of the World Cup to keep the Big Three in the tournament for as long as possible.

This World Cup is co-hosted by Australia and New Zealand across 14 venues. Therefore, in order to make traveling easier, both countries have ensured a streamlined visa processing service which will ensure more tourists from different countries, fetching about a profit of $200 million, according to several press reports. Interestingly, it is substantially low from the profit of $320 million earned during the 2011 edition hosted in this part of the world this area makes up almost two-thirds of the cricket viewing population in the world.

Impact on the Trans-Tasman Economy

New Zealand expects 400,000 tickets to be sold with 30,000 visitors coming in, mostly from India and England. For a small country like New Zealand, the exposure that they will get from constant advertising will have a far-reaching financial windfall. Interestingly though, New Zealand Tourism Industry Association chief executive Chris Roberts believes that it’s the Chinese New Year and not the Cricket World Cup that will bring in more travelers to New Zealand. The overall impact on the hotel business of New Zealand will be positive with close to 100% occupancy rate during the World Cup. With an average room revenue of $109, it is sure to have a positive impact on the New Zealand economy.

As for Australia, a conservative estimate is that close to 50,000 people will arrive for the Cricket world cup. Major Australian cities are experiencing an average of 7% growth in occupancy rates. ICC estimates ticket sales to be cross the 1 million mark, which will boost Cricket Australia’s earnings to close to 300 million AUD.

Cricket: A Form of Sports or a Lucrative Profession?

ICC has declared winning prize money of $4 million, an increase of 20% from the 2011 edition. The breakdown of prize money is given in the table below:

StatusPrize Money
Winner$ 4,000,000
Runner-up$ 2,000,000
Losing Semi-finalist$ 600,000
Losing Quarter-finalist$ 300,000
Group Match Winner$ 45,000
Group Match Loser$ 35,000

This table shows that even if a team loses every single match in the group stages, they will still earn $35,000, meaning, even if Bangladesh fails to win a single group stage match, each of the players, including the standby players, will earn not less than BDT 150,000 – an amount equal to a monthly salary of a mid-level multi-national corporate professional here in Bangladesh. Besides, there are other scopes of earning related to bonuses, performance bonuses, and various other bonuses. As for the winning team, if they go on to win every single match en route to winning the cup, will end up earning $4,020,000.

So, students can seriously consider the cricketing career as a profession as there are national and international tournaments and bi/tri-lateral series other than the world cup. And, obviously, there are the T-20 tournaments like BPL, IPL, and Big Bash, where cricketers can earn money as much as NBA players do in the US.

World Cup: The Bangladeshi Dream

So how will the world cup affect the tigers, in terms of finance? In terms of earnings, by a conservative estimate, Bangladesh has the potential to earn $125,000 if they manage to beat the associate teams and end up losing to the other 4 teams. There is cautious optimism regarding Bangladesh being able to reach the Quarters, which would need the Tigers to beat the two associate nations and one of Sri Lanka or England. If the Tigers can go through to the Quarters and lose, they’ll end up with a pot of $435,000. And obviously, there are 160 million people here in Bangladesh praying for the tigers, what other motivation can be bigger than this?

Co-author: Sazzad Hossain, AVP, and Ahraf Zahir, Junior Associate at LightCastle Partners

WRITTEN BY: LightCastle Analytics Wing

LightCastle Analytics Wing is the research division of LightCastle Partners. It is tasked with producing periodic reports on the different sectors of the economy, analyzing trends in markets and making methodical, thorough and intelligent analysis to improve strategy and drive business growth.

For further clarifications, contact here: [email protected]

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