Sports franchises

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As part of the trend of business/financial matters steadily taking over the headlines in the sports world, the word ‘franchise’ has been featuring significantly in the cricket and football media in the last week or two. Two big stories which have come out in this period and are still developing as we speak concern the young whippersnapper of cricket- 20/20- and its powerbrokers in the Indian Premier League (IPL). One concerned the global expansion of the Rajasthan Royals, the second the possible involvement of Manchester City Football Club in one of the forthcoming additional IPL franchises

First to hit the press was news of the ‘superfranchise’ created by the Rajasthan Royals, known as Royals 2020, designed to combine the sporting and, more importantly in most people’s minds, the commercial might of Rajasthan’s IPL franchise, English county side Hampshire, the Caribbean’s current leading lights Trinidad, Cape Cobras in South Africa with negotiations ongoing to make Melbourne-based Victoria the fifth element. One important factor to note in the coverage of this announcement and the fall out so far is that the governing bodies, in England and India at least, were not consulted in any way about this deal, potentially setting a dangerous precedent for the future behaviour of sports clubs/franchises.

You are no doubt familiar with the morally questionable behaviour of big business, as illustrated brilliantly in Joel Bakan’s “The Corporation”. Essentially, if it costs more money to obey the rules/law than not to, it makes commercial sense to simply break the rules and then take whatever punishment comes your way. It remains to be seen what, if any, sanctions will come the way of the teams involved in this tie-up but it seems as though the sides involved in the Royals franchise consider their commercial might superior to the power wielded by the BCCI and ECB. Even in the sporting niche that is cricket, money is becoming the dominant source of political power.

It has been seen on a wider scale over the past decade or so in the rapid rise to dominance of India. With a population approximately 10 times the size of all the other significant cricketing nations combined, and much less competition from other sports than in the traditional powerhouses England, Australia and South Africa, India has become by far the biggest source of income for the game as a whole. The other national boards and even the international governing body the ICC can ill afford to upset the Indians and lose millions of dollars of revenue. The stage has almost been reached where what Indian cricket wants, Indian cricket gets.

The IPL itself is one of the clearest examples of the power wielded by the Indian board, the BCCI. After the immediate success of 20/20 in England, this new format began to spread and domestic competitions sprang up to support the first-class game, everywhere a financially hopeless endeavour. When it came to India, two competing entrepreneurs saw the opportunity to make the 20/20 competition a real marquee event, appealing to cricket lovers and players around the world. First to the mark was Subhash Chandra, disappointed at repeatedly missing out in the broadcast rights to international cricket, with the Indian Cricket League (ICL) which boasted a number of international stars but did not have the support of the BCCI. The simple reason for this was that Lalit Modi and the BCCI had their own vehicle, IPL, to which the ICL would be a direct competitor. Anyone who thinks the fact that players associated with ICL were no longer allowed to compete in their respective domestic competitions or represent their national teams is anything other than the BCCI flexing its political muscle needs to get out more. It will interesting to see where the balance of power falls should any friction arise between the BCCI/IPL and the Royals.

Talk of franchises continued this week when Lalit Modi announced that an at the time unnamed Premier League football club, now known to be Manchester City, were interested in buying one of the 2 new IPL franchises which are being added to the competition from the 2011 season. Realistically, Manchester City were the only possibility as they are the only club in the Premier League who actually have a significant level of liquidity. In the announcement, Modi referred to one of ‘the big 3’, leaving commentators a little confused as to who this referred to and where the money was coming from. Of the group known currently as the ‘Big Four’, the traditional big 3 are Liverpool, Manchester United and Arsenal but they can barely afford between them to buy a cricket bat, never mind a team. The most financially potent of the four, Chelsea, are reportedly looking to become revenue-neutral and not rely on pocket money from Daddy Roman and having let numerous members of staff leave and reduced investment in players hugely, it would seem odd to then go and blow tens of millions on an IPL side.

So far, City have distanced themselves from the rumours and should probably concentrate on what Chief Executive Garry Cook would refer to as their ‘core competencies’ (‘playing football’ to you and me). Nothing at Manchester City obeys the laws of logic too studiously though, so look out for further developments soon.

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