THE LATEST twist in IPL’s evolution has turned the entire League on its head. By eliminating IMG from playing any further part in what has evolved from a fairy tale beginning for a young league into a juggernaut that has put international cricket on the back-burner and chewed on its competitor leagues, the BCCI/IPL have taken things a good deal further, and, ceteris paribus, one wonders whether this move could be the fatal spoke in its wheel.
To put things into perspective however, one should keep in mind that in all likelihood, this is merely a negotiating ploy. Having brought IMG down from an understanding whereby it received ten per cent revenue share the first season, to a more manageable blanket Rs 330 million per season thereon, the League might now feel that this is still significantly more than it is willing to dish out, and by terminating the contract at this point, it could attempt to leverage its bargaining power to secure a better deal for itself and for the franchisees.
This would be akin to the tactics the IPL astutely employed during the episode with SET MAX, where by terminating the original contract, the League and its franchisees managed to virtually double their revenues from broadcasting rights when the contract was renegotiated and re-executed. And, if posturing is what is behind the present situation as opposed to the somewhat unrealistic belief that the event can be organised bereft of any expertise from a leading sports management firm, then this would merely make economic sense for the stakeholders, albeit with the deployment of somewhat uncertain fair-play ideals.
This may not be all that is behind the termination of the agreement however. The fact that the franchisees have come out this time in IMG’s support, leads one to believe that there may actually be other contenders for organising this League, and that is where the dichotomy between aspiration and reality arises. It also reflects the changing mindset of sports in India as they get professionalised and corporatised. In what is subtly being referred to as a unilateral decision, this is actually a protest by the franchisees signifying a realisation of, and discomfort with the perceivable abuse of dominant position on display here by the BCCI/IPL, with respect not only to the treatment meted out to IMG, but importantly, to the franchisees themselves who were not consulted prior to the termination notice.
That having been said, it is unlikely that the franchisee agreements that the teams have with the league, gives them the right to veto the appointment of, or support the appointment of the sports management/event management firm from the perspective of organising the entire event. Contractually therefore, it is unlikely that they have much recourse. IMG on the other hand, might, although the exact stipulations governing termination and revenue share have not been made public at present. The fact that IMG has mentioned legal recourse leads one to believe that some argument against premature or illegal termination is being ruminated, although how successful that would be is also difficult to ascertain at this point. It would depend in large part on the type of dispute resolution proposed, and the jurisdiction chosen.
The legal arguments aside however, it seems unlikely that any other sports management firm in India can successfully organise an event of this magnitude at this juncture. In all honesty, IMG has made hosting the IPL look easy and seamless, but that is due to the magicians behind the helm of the world’s first and best known global sports management firm.
Globally, replacing IMG with a competitor who could get the job done would not only be possible, but the success associated with such a move would be probable, especially if a replacement was found among other leading sports management firms. In India unfortunately, the options available beyond IMG for hosting this mega-event, are virtually non-existent. Therefore, if tomorrow IMG is replaced with an indigenous sports management firm, or even if the League decides to conduct the event by itself, the logistics, experience, relationships, expertise in broadcasting, and other such vital elements of sports management, will be hard to replicate. Factor in the skilled services, and especially the legal support that a firm like IMG gives to the League out of its international offices, and one would have some gigantic shoes to fill.
There is very little that can derail the IPL apart from implosion, and the benefit of the doubt must be given to the League today, before one finds out the true reasons behind the termination. If however, it’s a matter of conservative cost-cutting measures or if it’s to do with an aversion to allowing the balance of power to shift to other circles, then there is a cause for concern.
Making a habit out of bluffs and crying wolf isn’t the best way to foster a sense of trust and reliance however, and as the League matures, one would hope that there would be greater focus on the written word and good faith, and less on the uncertainty surrounding decade-long contracts, and the front page second-guessing.
In all likelihood the matter will be resolved, and the IPL will return larger than life, and twice as flamboyant. What isn’t ascertainable is how the ease with which the League is able to do business will impact the League from a long term perspective and its perception. It’s not that IMG’s value-add to the IPL cannot be provided by some other entity over time. It’s just that in today’s day and age no one else can bring what a global sports management firm does to the table for a lavish visual, substantive, and qualitative 45-day feast.
That aside, one could question the prudence of upsetting a cart laden with golden apples with a diamond core, merely for a few crores: not a princely sum when one looks at the valuation the League commands.
The author is a Sports Attorney at J. Sagar Associates.
