Even if they are looking at the IPL as a long-term business proposition, anticipated losses from the second IPL season because of the move to South Africa, have some of the teams worried. IPL Commissioner Lalit Modi though, says it's much too early to be gloomy about this season. In a chat with the Hindustan Times, he says why.
The franchises are saying they have no idea about how much money they’ve spent or how much they’ll get from IPL II.
This (the meeting on Wednesday in Mumbai) was only the first meeting, where we asked them to give us figures for expenses incurred by them. We can give them a better idea only when we get those figures. But we don’t have to give them the data on what expenses we’ve incurred. We’re waiting for theirs. We know how much they would have spent on hotels etc, because they were required to go by the centrally contracted rates. We know for instance, that if the quoted rate was $200 (Rs 9783 approximately), we got a centrally contracted rate for $120 (Rs 5869 approximately).
They say they would have lost money on India-specific events/contracts because of the move to South Africa. Would you compensate them for that?
We’ll see what they give us before we decide. We don’t know anything about that yet. So I don't think they can say they are making losses yet.
But they say they are...
It’s too soon to say so yet. Unless we give them the numbers, how can they say that they have incurred losses?
Realistically, when do you anticipate their making profits?
This year, or at least most of them will break even. They say they won’t, by their estimated calculations. Then they definitely will in a three-four year period (from the time of the creation of the IPL). In any case, we have assured them that we will cover them for this in the first few years.
Will the accounts have to be ready by the BCCI AGM in end-September?
Yes, the accounts have to be given to the AGM, which is why we’ve asked the franchises to give this to us first. They say you haven’t yet got your accounts in order from South Africa and are awaiting that. But that really has nothing to do with their giving us their account of expenses. We have to get all the data together and then figure out how much was spent by who.
Some team officials believe your bottomline of $250 million for a new team for the 2011 season is unrealistic. Is it?
It’s definitely most realistic, and in fact, will be in the $250 to $300 million range.