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N Srinivasan
Innovative BCCI may ‘reverse auction’ interim IPL franchises: Not yet sold
Chennai Super Kings (Photo credit: Wikipedia)
The BCCI can be creative.
They’re also very intent on playing it safe.
For some reason, they do not intend to let Chennai Super Kings (CSK) and Rajasthan Royals (RR) suffer when they return from their suspension in 2018.
The country’s premier cricketing body have decided to float two fresh teams in the Indian Premier League (IPL) but only for two years.
The new franchises will not find it easy to be profitable within those two years. It is definitely not a sustainable proposition for them.
Hence the BCCI, in all its wisdom, have decided that ‘Reverse Bidding’ is a distinct possibility that could be offered to its new suitors.
Panoramic View of the Stadium during IPL 2008 (Photo credit: Wikipedia)
A senior BCCI office-bearer said:
“If there is lack of interest in conventional bidding because of this two-year span, there is a possibility of reverse bidding that can happen where in an investor, who bids the lowest amount will be owner of a team. For example, if BCCI plans to pump in Rs. 70 crore, it might be the potential investor can buy bidding at Rs. 50 crore, Rs. 40 crore or Rs. 30 crore depending on the lowest.”
Players from the suspended franchises would be made available in the auction pool.
Rajasthan Royals (Photo credit: Wikipedia)
The BCCI is keeping its cards close to its chest.
When queried whether there would be a 10-team league from 2018, the official replied:
“Look, our contracts with all the sponsors and the official broadcasters ends after the 2017 edition. Post that, we will start with a clean slate and all players would go back to auction.”
Investopedia defines a ‘Reverse Auction’ thus:
“A type of auction in which sellers bid for the prices at which they are willing to sell their goods and services. In a regular auction, a seller puts up an item and buyers place bids until the close of the auction, at which time the item goes to the highest bidder. In a reverse auction, the buyer puts up a request for a required good or service. Sellers then place bids for the amount they are willing to be paid for the good or service, and at the end of the auction the seller with the lowest amount wins.
Reverse auctions gained popularity with the emergence of Internet-based online auction tools. Today, reverse auctions are used by large corporations to purchase raw materials, supplies and services like accounting and customer service.
It is important to note that reverse auction does not work for every good or service. Goods and services that can be provided by only a few sellers cannot be acquired by reverse auction. In other words, reverse auction works only when there are many sellers who offer similar goods and services.”
The BCCI does not believe that its two year revenue model is sufficiently attractive to any prospective parties.
The reverse auction indicates that the BCCI is willing to subsidise some of the costs that will be incurred by the franchises; the auction is an attempt to minimise the BCCI’s losses.
This is not substantially different from one of the suggestions floated earlier that the BCCI manage the suspended franchises for the said period. The difference here is that two new teams will be floated but they will be allowed to choose any other cities not allocated to the other six sides including Chennai and Jaipur.
This is probably a response to the newly drafted conflict of interest rules to be tabled at the AGM.
The interim solution allows CSK and RR to pick up the core of their current set of players when they return to the IPL fold in 2018.
(N Srinivasan, the BCCI gods still shine bright for you.)
A base price will be set for potential buyers of the interim franchises.
K Shriniwas Rao explains:
“If the BCCI, for example, sets the base price of the franchise at Rs 100, bidders will be allowed to quote an amount lesser than Rs 100. The lowest bidder will be given the franchise. BCCI will pay the winning party the bid amount that will partly cover for the franchise’s operational costs heading into the tournament.
The bidder can also quote a figure running into negative. For instance, if the bidder quotes a figure of Rs -10 or Rs -5, he she will have to pay that (negative) amount to BCCI. The board expects potential bidders to like this idea if they have a specific two-year marketing or branding initiative in mind for which they won’t mind spending from their pockets.
The interim franchises will not receive a share of the central revenue pool unlike the other six existing teams but will be eligible for a substantial amount in terms of prize money (for players) and additional performance-based incentives from the central revenue pool if they make it to the top-four in the tournament.
In turn, these interim franchises can earn from local revenue pools – gate money, sponsorships, merchandising and hospitality management – to further cover their operational costs. The 50-odd players from CSK and RR, who’ll be up for sale at the auction, will first be part of a draft for the new franchises to retain. The number of players that could be allowed for retention through draft hasn’t been finalised yet. After the draft, once all franchises are on a level playing field, an auction will take place for the remaining players.”
As highlighted above, negative bidding is a possibility but unlikely. IPL teams have struggled to be in the black right from the start until now and it’s improbable that any franchise can turn a profit in just under two years.
Reverse auctions have been used in India before notably while awarding Coal India’s captive coal blocks to power producers.
These type of auctions are also preferred by corporate purchasing managers using them to procure paper clips to employee health care plans.
Procurement professionals love them; suppliers hate them.
Max Chafkin writes:
“Despite the fact that bids are generally ranked by price, reverse auctions are not binding for the buyer. Companies will sometimes go with the second- or third-lowest bid based on qualitative factors such as reliability, customer service, and the cost of switching away from an incumbent supplier.”
He adds:
“If, for instance, you know you’re bidding against a low-margin supplier with a history of quality problems, you may chose to aim for second place because the purchaser is apt to shy away from your opponent. If you’re bidding against a supplier that already has the account, assume that you’ll have to beat the supplier substantially on price to offset the cost to the customer of switching vendors.”
What this implies is that should the BCCI opt for this model, it is not bound to choose the least two costly bids. Other factors such as business plan,revenue model, finances, and reputation in the market would also have to be considered.
The die is set. May the blacker ink win.
Shashank Manohar presides over cleaning up of BCCI’s IPL
Newly elected BCCI President Shashank Manohar hit his straps and struck the right notes at its Working Committee meeting last Sunday.
The decisions that the general public evinced most interest in were the ones pertaining to who would replace Pepsi as the title sponsor, whether the Chennai Super Kings and Rajasthan Royal franchises would be terminated or suspended and what would be the particulars of the newly framed conflict of interest rules within the cricketing body.
The Board did not disappoint.
Pepsi logo (1970-1991) In 1987, the font was modified slightly to a more rounded version which was used until 1991. This logo is now used for Pepsi Throwback (Photo credit: Wikipedia)
Pepsi are expectedly out.
Surprise, surprise, it’s not Paytm replacing them but Vivo mobiles. That’s pulling a rabbit out of a hat.
Fair enough, given that Vivo agreed to the deal at the same price that Pepsi signed on.
Paytm would have been hard-pressed to match that.
The BCCI, after all its fulminations and discussions with the franchises’ owners, submitted to Justice Lodha committee’s dictates suspending the CSK and RR franchises for two years. The show must go on though—with eight teams.
Tenders will be floated and bids invited for two fresh franchises—once more making it a 10 team league in 2018.
Good enough.
It is the proposed conflict of interest rules that have raised a hue and cry within the BCCI and the state associations.
Shashank Manohar has taken a leaf out of his judicial textbook and drafted a stringent set of stipulations for administrators, selectors, commentators and players.
You could swear you heard a collective groan within the cosy cricketing fraternity.
To the highest bidder goes the spoils.
And you can rest assured that ex-cricketers will be scrambling to join the IPL band-wagon where the highest paymasters reside.
The guidelines will be tabled at the Annual General Meeting on Monday, 9th November 2015 at the BCCI Headquarters in Mumbai.
Manohar certainly means business when it comes to cleaning up the IPL mess.
No further comment.
IPL Governing Council buys time for all concerned, except the fans
Trust the BCCI (more specifically, the IPL Governing Council) to appoint a working group to look into the recommendations of the Lodha panel.
Franchises’ input into the process is ostensibly the reason touted by the council.
It is an excuse to buy more time. It does not come as a surprise; the BCCI is split into two warring factions, one for ICC chief N Srinivasan and the other against.
The BCCI has six additional weeks to arrive at a decision.
“The show must go on,” says IPL chairman Rajiv Shukla.
It’s evident that there will be another IPL next year with eight teams, not six.
There will be yet another auction, the players and support staff will be happy that they are not monetarily or otherwise affected, the Supreme Court verdict will be honored—if not in principle.
The question on everyone’s mind: What is N Srinivasan going to do?
His position as ICC chairman is even more untenable by the day.
Can he pull yet another rabbit out of his hat?
The governing council’s decision has given him time to ponder his limited options.
If the BCCI (and the ICC) is serious about clearing the mess that is the IPL, the India Cements strongman has to exit.
Whether the CSK and RR franchises are terminated is moot. The Supreme Court verdict is less harsh than what the rules dictate.
Teams have been terminated for less.
The BCCI has painted itself into an inglorious corner with its inability and unwillingness to clean up its Augean stables.
It waited for the Supreme Court to burn them down, instead.
Is it now delaying only for the Supreme Court commission to drive the final nail into its coffin when it completes its investigation into the allegations against IPL COO Sundar Raman?
That will be Judgment Day indeed.
BCCI and its IPL options: Fans’ choice
The Supreme Court appointed Lodha committee has pronounced its verdict on the IPL betting scandal.
Two teams, Chennai Super Kings (CSK) and Rajasthan Royals (RR), have been suspended for two years.
Their principals, Raj Kundra and Gurunath Meiyappan, have been handed out life-time bans from any cricketing activity.
Where does this leave the IPL, specifically IPL 9?
There exist three options that the BCCI can exercise:
1> Restrict the competition to six teams and re-negotiate contracts that expect eight teams to take part with their supporting sponsors. The reduced revenue to the BCCI should act as a punitive spur to promote transparency, integrity and probity in the running of the league. Given the current format, the number of matches would be reduced to 34. A simple tweaking of the rules and each team can play the other three times instead of two. This would increase the number of games to 49. Though substantially less than 60, this would ensure a much shorter, tighter IPL. The third game can be played at neutral venues, specifically at Chennai and Jaipur. After all, why should local cricket fans suffer for their franchises’ moral rectitude?
2> Retain the suspended teams and either have the owners unload the franchises or have the BCCI take over the reins for the suspension period. Valuations have plummeted and the said franchises can be had at bargain prices by interested parties. The latter entails a conflict of interest but does the BCCI care? It never did when it had N Srinivasan at the helm.
Kochi Tuskers Kerala (Photo credit: Wikipedia)
3> The final solution would be to hold fresh auctions for one or two franchises. This depends. Can Kochi Tuskers and the BCCI arriving at an understanding about the Kerala team’s return to the IPL fold? The players of suspended teams would be made available to these ‘fresh‘ franchises. CSK and RR can return after serving out their sentence. The BCCI would then have 10 IPL ‘subsidiaries‘ as originally envisioned. The format can be jiggled once more to include two groups of five teams each, ensuring a total of 44 games in all.
These are, of course, the options available to the IPL governing committee.
What is the best course of action?
The Indian cricket fan is disillusioned with the way the IPL is now governed. Yes, its glitz and glamour and viewer-friendly format, sound and color have attracted fresh eyeballs to the game.
But is this truly a professionally run league?
Options 2 and 3 seem like ‘business-as-usual‘. “Yes, the Supreme Court has rapped us—the BCCI—yes, we are the cynosure of attention of the sporting world who are aghast that a league considered the forerunner of the mushrooming T20 leagues across the world with a model that was copied and followed is brought to its knees by corruption charges once more.”
The above options, while not benefiting the BCCI to the extent it envisioned when it conceptualized the league, especially with depressed valuations, will seem to discerning fans that the administrative body does not really foresee the reforms needed to overhaul the existing system.
Yes, it takes sponsors, advertisers and televising partners’ interests into account but does it really serve the public, the people who support the game through thick and thin? What happens when this very demographic turns against their beloved cricketers?
Leagues for other sports such as kabaddi, soccer, hockey and tennis are vying for viewer attention. Can the BCCI afford to turn a blind eye to fans’ sentiments?
In my opinion, the best course of action is to play six teams. Let CSK and RR players sit out. The BCCI should force the owners to compensate them and pay out their dues for the rest of their contracts. The message is clear: “Keep your eyes and ears open for any hanky-panky in the league and inform the concerned authorities as soon as possible. Else you too (players) may have to bear the consequences.”
It also sends out a strong signal to the owners that the BCCI will not bail them out in any way either by playing caretaker or allowing them to dispose off their non-performing assets so easily. The BCCI is just one player—albeit the most important one—in this morass. The franchises owe their supporters accountability, transparency and honesty as well.
The IPL may well be a better and bigger place to work, play and be in after all the dust has settled. For now, the legal scrapping continues.
Shilpa Shetty announces soap opera on IPL (Satire)
Shilpa Shetty at the IIFA Awards (Photo credit: Wikipedia)
July 15, 2015, Mumbai:
Shilpa Shetty and her husband Raj Kundra announced the making of a soap opera for Indian television titled ‘IPL: Heroes to Zeroes‘.
At a glitzy affair attended by most of the bigwigs in Bollywood, the glamorous actress said:
“S2 Global Productions will be producing a magnum opus on the Indian Premier League, that will begin with its inception in 2008 and end with the current denouement by the Supreme Court on the fate of teams Chennai Super Kings and Rajasthan Royals. It will attempt to present our side of the story—the IPL saga from the viewpoint of team owners and their travails and run-ins with the BCCI dictatorship. Raj and I will be portraying ourselves. My husband has always been fascinated with Bollywood and has always wondered if he could romance me onscreen. This is his golden opportunity.
Our friends in Bollywood, Preity Zinta, Shah Rukh Khan and Juhi Chawla have graciously consented to be a part of this venture and play themselves as well. Talks are on with Lalit Modi to have him play a stellar role in the series. His is indeed a unique role. He is both hero and villain. Indian television has never seen such a paradoxical character and we would love to have him on-board. We will be shooting all his scenes overseas and are willing to accommodate his travel schedule while meeting our requirements.
We would love to have Mr. N Srinivasan and his son-in-law Mr. Meiyappan shoot for us as well. But we hope the public understand if that’s not possible.”
English: Indian actress Preity Zinta (Photo credit: Wikipedia)
Ms. Shetty added:
“The production values for this series are lavish. We estimate that this will an even more expensive affair than Anil Kapoor’s 24. The show will be in Hindi and will be dubbed in the regional languages. We are also looking at international tie-ups for an English version of the series. The series will have several firsts. Each episode will be streamed live on a pay-per-view basis. The publicity will be conducted on social media only. We have a predilection for Twitter and Instagram as our preferred vehicles of choice.
We also hope that our out-of-work IPL crew and team-members will join us. We have starring roles of every member of the CSK and RR franchises. This is our way of ensuring that they do not feel left out in any way. We also have bit roles for the various team cheerleaders and hope that some of them can go on to bigger roles as item girls in Bollywood films. IPL anchors such as Archana Vijay and Shibani Dandekar are also being sought to be narrators for different seasons of the soap.
While we do have screen writers for the scenes and dialogues, the twists and turns in the plot write themselves. Truth in this case is stranger than fiction and we have no qualms in courting it.”
Mr. Raj Kundra said:
“This is a big bet for us. It can make or break our production house.”
Disclaimer: This is a work of fiction. While the personalities are real , all facts are made up and any resemblance to any persons living or dead is purely coincidental. But you knew that, didn’t you?
Supreme Court: What they said, really meant and definitely didn’t
Supreme justice for N Srinivasan.
What they said:
“Individuals are birds of passage while institutions are forever.”
The Supreme Court bench of Justices T S Thakur and F M I Kalifulla read N Srinivasan his rights in a ruling that effectively prevents him contesting for the BCCI top post.
The judges ruled out any person having a commercial interest in BCCI events from being a part of the governing body. Srinivasan has a controlling interest in Chennai Super Kings, an IPL team.
They said:
“The BCCI is a very important institution that discharges important public functions. Demands of institutional integrity are, therefore, heavy and need to be met suitably in larger public interest. Individuals are birds of passage while institutions are forever.
The expectations of the millions of cricket lovers in particular and public at large in general have lowered considerably the threshold of tolerance for any mischief, wrong doing or corrupt practices which ought to be weeded out of the system.”
What they really meant:
“…birds of passage…..And your time is past, Mr. Srinivasan. You are not the BCCI and the BCCI is not you.”
What they definitely didn’t:
“Could we have a couple of freebies to the CSK games, Mr. Srinivasan, please?”
N Srinivasan: What he said, really meant and definitely didn’t
N Srinivasan is not resigned to his fate.
What he said:
“Why should I ask him to resign?”
N Srinivasan is not conflicted about whether he should retain Indian skipper MS Dhoni as an India Cements Limited employee and Chennai Super Kings captain.
The beleaguered BCCI chief was rapped by the Supreme Court for a conflict of interest in the hearing on the Mudgal commission report’s investigation into the IPL spot-fixing scandal.
Replying to reporters as to what Dhoni’s role was at ICL, the ICC chairman snapped:
“Why should I tell you?
What he really meant:
“Who am I to ask Dhoni to quit while I don’t? Why should he? Is he my son-in-law?”
What he definitely didn’t:
“Am I my CSK team’s skipper’s keeper?”
IS Bindra: What he said, really meant and definitely didn’t
IS Bindra
What he said:
“It’s such a frustrating scenario: One can’t become the chief minister, but one can still become the prime minister! “
IS Bindra, former president of the Punjab Cricket Association (PCA), is acerbic about the current farcical situation; Narayanswamy Srinivasan is unable to preside over the BCCI pending a Supreme Court judgment yet is chairman of the ICC.
The outspoken former BCCI chief recently stepped down as head of the PCA.
He said:
“I haven’t made it easier for Srini … In fact, I’m free to blog and tweet exactly what I want… My hands aren’t tied now…”
On his retirement:
“I’d reached a stage where I felt I couldn’t do anything for cricket in India…
Also, I didn’t want the PCA to suffer because of my strong views on Srini. Mohali should have got a Test against the West Indies, but didn’t. Yet, there are affiliates of the Board who keep getting international matches out of turn…
I’ve helped build the PCA and I’m passionate about it. I couldn’t have allowed it to be penalised because of my convictions. I’ve always respected the primacy of institutions…
Above all, there comes a time in everyone’s life when one has to gracefully retire and move on after having been at the helm of an institution. I couldn’t have been at the PCA forever.”
On Jagmohan Dalmiya:
“I’d expected Jaggu to join me in the fight to oust Srini, but he didn’t do so. It’s for him to explain why. I’m as disappointed with quite a few of the others in the Board who, too, have chosen to stay quiet.”
On Srinivasan’s chances of returning as Board president if the Supreme Court fails to bar him:
“If that’s so, then Srini will win. Who’ll oppose him? For one reason or the other, I don’t see any opposition. Not when the men with influence are silent. I’ve retired as an administrator, but my love for cricket remains undiminished. I’ll gun for whoever tries to harm the game in India. You can be assured.”
What he really meant:
“It’s like you can be President but you can’t be governor. Or you can volunteer but you can’t work.”
What he definitely didn’t:
“Let’s play musical chairs with the Supreme Court, the Pied Piper.”
N Srinivasan: What he said, really meant and definitely didn’t
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Make Time For Sports. 