FSDL exploring revenue sharing model instead of franchisee fee for ISL founder clubs

The ISL’s founder clubs will no longer need to pay the annul franchisee fee from next season.

The Indian Super League (ISL) will complete its 10th season at the end of the 2023-24 campaign. It has been a decade of evolution, development and growth for the league and Indian football in general.

The ISL changed the way people look at the sport in the country and has led the way as the nation’s top league. The league has played a crucial role in restructuring the football culture in India and the changes are there for everyone to see.

FSDL in search of new revenue model

When the league began 10 years ago, it had eight founding clubs who entered into a joint contract with Football Sports Development Limited (FSDL) and Star Sports for a period of 10 years, whereny they had to pay a franchisee fee.

Now, with the agreement set to conclude at the end of the 2023-24 ISL season, the FSDL is exploring a new revenue sharing model as the founder clubs’ tenure of paying the franchisee fee is getting over soon.

Currently there is a master agreement between the ISL teams and the FSDL which have this option of sharing revenue as a franchisee fee.

However, the new revenue model will exclude the likes of Bengaluru FC, Jamshedpur FC, East Bengal and Punjab FC who entered the ecosystem later. FSDL are planning to introduce a new revenue model wherein all the clubs, except for the ones mentioned above, will need to pay a certain percentage of their revenue to the league’s governing body.

In short, the franchisee fee model will be replaced with the clubs paying a certain percentage out of their revenue to FSDL. It is very important to note that this model will only be applicable to the founding clubs of the league at the outset.

Currently there is a master agreement between the ISL teams and the FSDL. Discussions are going on to decide the final amount of the new revenue model. And how and when will the new revenue model come into force remains to be seen.

A good move for founding clubs

It is no secret that ISL clubs often make losses and have faced financial struggles over the years. A major reason behind that is FSDL’s franchisee fee stipulation because it acts as an added pressure on the clubs.

However, with the franchisee fee model coming to an end, the new revenue sharing model is expected to help the clubs’ financial sustainability moving forward. Moreover, in this way, clubs will be able to earn more revenue and re-invest their money into some fruitful projects.

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