When Cricket360 asked the question about stadiums built by franchises such as the Yankees in the US and suggested a KKR stadium in Kolkata, Shah Rukh Khan made a humorous comment that they would like to but that they didn’t have the money to buy that kind of place! According to Lalit Modi, the IPL is based on different model and made the argument against a multibillion dollar stadium because of the costs.

“At the end of the day it is the costs. Someone has to pay for it and the fan ends up paying for it one way or the other; or the sponsor ends up paying for it one way or the other,” said Modi. “The ticket pricing is going to reflect the multibillion dollar stadium” he told cricket360 that the BCCI and the IPL as the “custodians of cricket in India” have the objective of to “build better infrastructure and facilities in our country” which included stadiums.

“Some franchisees may want to build their own stadium but it is not financially viable at all,” said Modi. “You have seven maybe ten or twelve home games in a year. How do you sustain a billion dollar stadium for ten, twelve, fifteen days in a year?” he argued. According to him it made more economic sense for the BCCI and IPL to provide the facilities to the teams and owners.

This is why according to Modi when you look at the balance sheets of the Yankees, the chances of making profits are far down the line  and average ticket pricing is hundred dollars or hundred and fifty dollars.

“Here you have pricing at ten, fifteen twenty dollars a ticket and you want to build that market at that pricing, yes you may have a few seats at a thousand dollars, which is very difficult to sustain in a billion dollar stadium, “ he said. Modi also spoke about how leagues or franchisees around the world find it difficult to make profit in spite of high valuation perceptions but this was not the case with the IPL.

“I guarantee you by the end of the year all eight teams in India will be making a profit. We have moved off shore, but which league in the world can show that all teams will turn a profit,” he said. He said to him it was all about adding value and people will come back and pay more for it. So according to Modi it is the bottom line that is ultimately what proves his point.

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3.25 Copyright (C) 2007 Alain Georgette / Copyright (C) 2006 Frantisek Hliva. All rights reserved."

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