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Merchandising will explode: Lalit Modi

The decades of troubled student years and struggling businesses were swept aside as Lalit Modi set up cricket's most glamorous and lucrative pro league.

The man who created what is now called the "the world's hottest sports league" hit his stride after entering the BCCI in 2005. The decades of troubled student years and struggling businesses were swept aside as he set up cricket's most glamorous and lucrative pro league. Lalit Modi speaks to India Today on the surprises of Season 3.

 

Did the bidding amounts for the two new teams surprise you?

 

Yes, but a little bit. I expected bids in the $325 million range. I came up with the base price based on internal calculations. Our base price was around $275 million and we proposed $250 million as the minimum. The number we came up is based on a fourth year cash flow breakeven.

 

How do you expect the new teams to make between $37 million and $33 million in Season 4?

 

They need to understand that the model we have built is very different from all other models in the world. They need to embrace the model and not only think of their team but of the whole league as one. If people try to tinker with the plan, it can be disastrous too. If people start to find ways to beat the system for the good of their own team, then we will head for bigger issues.

 

What is the IPL's plan?

 

Ensure equality at all costs. All teams must be equal, thus all must get to spend the same amount of money and have the opportunity to buy all the players. That is the key to the success of the league. Teams should come first in building the league and not players in a particular team. Players will need to shuffle from team to team every three years. That's our model. It's not been done anywhere in the world. But we have done it and it works. This keeps teams evenly balanced, games unpredictable, viewers hooked. Ratings keep stable or go up, excitement increases. We also now need to keep expanding distribution globally, to create eyeballs.

 

What are the new revenue streams you are working on?

 

I see merchandising and licensing exploding in the years to come. We need to be in the market for ticketing and hospitality by October this year and every year, and at least a year in advance. Exhibition matches overseas will be a great source of revenue. We will begin 2011 with that.

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