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    South Asia
     Apr 23, 2005
Cricket's home moves closer to the money
By Raja M

MUMBAI - From August, cricket's global headquarters will be a little closer to South Asia, where it is by far the most popular - and lucrative - game. After 95 years of ruling world cricket from a small office at the Clock Tower of London's Lord's cricket ground, the International Cricket Council (ICC) will move to Dubai in the United Arab Emirates, a move reflecting the game's changing financial epicenter and one that is aimed at taking advantage of the tax-free status of the emirate.

Inderjit Singh Bindra, a leading Indian cricket administrator credited with visionary ideas, approved of the ICC move. "All major sports organizations, including the Federation Internationale de Football Association [FIFA], have moved to tax havens," he told Asia Times Online. "The ICC cannot afford to pay 30% tax - it will save millions of dollars with this move."

Bindra, a civil servant for 40 years and cricket administrator for 30 years, presides over the Punjab Cricket Association that owns one of the best cricket stadiums in India. In March, Bindra made a startling claim that Indian cricket could be worth US$2 billion within the next four years, becoming one of the top money-spinners in global sport and in the Indian economy. India's famed entertainment industry as a whole is estimated at $4.3 billion.

Megabucks, according to Bindra and his friend Lalit Modi, the Rajasthan Cricket Association president, will come with their brave new idea of an exclusive cricket TV channel in India, owned by the Board of Control for Cricket in India (BCCI), the game's presiding authority in the country. At present, the BCCI has a notorious habit of being drowned in controversy and dragged to court after any TV rights sale. Recently, it was sued for $362 million by Zee TV for being denied telecast rights, despite Zee being the highest bidder.

Bindra, a former BCCI president when India hosted the 1996 World Cup, told Asia Times Online that the new cricket channel could be like Manchester United's MUTV, the first sports club-owned TV channel. Bindra said experts have worked the numbers over the proposed pay channel, which the BCCI is planning to discuss. "If American college football can be sold for $600 million annually, why can't Indian cricket sell better?" posed Bindra, referring to CBS's purchase of National Collegiate Athletic Association (NCAA) tournament rights. "In America, about seven leading sports compete with each other, including baseball, basketball, tennis, ice hockey and American-rules football. In India, cricket is bigger than Bollywood in terms of following. We can make it as big as the NBA [the US National Basketball Association]."

If Bindra's dream comes true, then India's superstar cricketers will become some of Asia's richest people. Thirty years ago, when Bindra became cricket administrator, Indian international players earned about $50 a Test match (five full days of work). Allowances were so paltry that Sunil Gavaskar, the legendary former Indian batsman, revealed in his autobiography Sunny Days how he and his teammates devoured biscuits (cookies) served with tea at county grounds in England to save money on meals. In comparison, current superstars Sachin Tendulkar and Virender Sehwag earn about $1 million annually from endorsements, including annual contracts with the BCCI that are worth $134,000. Bindra says Tendulkar and Sehwag could earn $40 million a year if his proposals take off, on par with Michael Schumacher, Formula One racing champion and a close friend of Tendulkar.

India is now acknowledged to be the epicenter in world cricket, a game played at various levels among 92 ICC member countries, including leagues in Hong Kong, Thailand, Malaysia and Japan. "Some 60% of income in world cricket is generated from India," said Bindra. "Even in the 1999 World Cup in England, not only sponsorship revenue but 60% of ticket sales came from Indians and people of Indian origin."

It took an Indian to change the financial health of the ICC. When Jagmohan Dalmiya, Bindra's former friend and now bitter rival, took over as the first Asian president of the ICC, the world body had $37,000 in its kitty. When Dalmiya left, the ICC had $11 million. The ICC 2003-04 balance sheet shows total assets of $94.9 million, a net cash outflow of $79.5 million and $79 million in cash and investments.

The turning point in the cricket power center shifting toward Asia came with India winning the 1983 World Cup in England. Next, the subcontinent wrenched the next World Cup hosting rights in 1987, the first time it was hosted outside England. Big money rolled in with the BCCI beginning to sell TV rights since 1993. In 1994, the board earned $1 million for TV rights. In 2004, it rejected a $308 million bid for telecast rights in a murky controversy that's now in court.

More interesting, the Bindra group wants to make the BCCI a public limited company, launch an initial public offer, be listed in stock exchanges, be monitored by the regulator Security and Exchange Board of India and answer to the cricket fan as a stakeholder. "We want professionals to run cricket," said Bindra. Presently, the BCCI and its "honorary" top office-holders, mostly leading politicians, administer the richest sports body in South Asia in a manner ranging from amateurish, ad hoc to accusations of acting like a mafioso.

Bindra's new business order promises paying the 26 affiliated regional cricket boards in the country $23 million annually, compared with the $450,000 they currently receive from the BCCI. He envisages 50 million of the 100 million cable TV homes in India paying $1 a month subscription fee for the cricket channel, which works out to $600 million a year.

"With selling rights for the Internet, cellular phones, TV advertising and merchandise, we are absolutely convinced about earning at least $1 billion annually in post-tax profits," says Bindra. "We have had leading experts study the numbers." His partner in the proposal, Lalit Modi, had earlier nursed the marketing of ESPN, Dubai-based Ten Sports and Doordarshan Sports in their infant days in India.

Bindra talks of a new inter-city cricket league, privately owned clubs, telecasting domestic cricket and buying rights to get more international cricket in India. He is also upbeat on compact formats of the game, such as the new "Twenty 20" that lasts for three hours instead of one day or five days, providing relief to those worried about cricket's negative impact on the Indian economy in terms of man-hours lost in front of television. As Bindra's friend Modi reminded a local news weekly recently, "Since India is driving the business of cricket, why should we not be in the driver's seat of world cricket?"

(Copyright 2005 Asia Times Online Ltd. All rights reserved. Please contact us for information on sales, syndication and republishing.)



India pays a high price for cricket (Mar 3, '05)

Cricket mania and fast money (Jul 16, '04)

Pakistan cashes in on cricket (Feb 11, '04)

 
 

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