India: Reality Cheque For IPL

Last Updated: 27 June 2011
Article by Desh Gaurav Sekhri

Originally published in Financial Express, January 12th 2011.

For those who thought that IPL 4 was a dying property, the weekend served as a reality 'cheque' that the league swiftly cashed. And, while the dichotomy between Saturday and Sunday's auctions was stark, and the flow of Saturday's activity dwindled to a mere trickle on Sunday, the numbers speak for themselves. A total of 127 players of the original 353 who were auctioned, generated a total purse of $62.8 million. Most (approximately 75%) of the activity commenced and concluded on Super Saturday, and prior to that, including the retained players. However, with a salary cap of $9 million for each team to fill its rosters with 30 players in total (except for Rajasthan, who had a total of $7 million due to pending legal complications), 55 players were taken on Sunday for $9.9 million. Indian players constituted 45 of the 127 players taken in the auction, and the Australians made their presence felt with 36. Including the 12 players that were retained in advance of the auction, the 10 franchises have now contracted 139 players.

While there may not appear to be a consistent theme for the IPL's auction, one should cut them some slack as they try and transcend the event/tournament structure, and head towards becoming a league with a draft system and structured contracts. While most Indian players raked in the INR, the auction by itself is somewhat unstructured, as is the exact nature of the contractual stipulations agreed to between the teams and the players, and more importantly, the teams and the IPL. Taking into account the number of days that each cricketer is committing to the IPL, players like Zaheer, Jadeja and Sreesanth stand to make nearly $100,000 a week for the duration of the event. While players from the West Indies, England, and Pakistan got the cold shoulder for reasons ranging from conflicts and diplomatic uncertainty, the range and depth of cricketers on display for IPL 4 still makes it the greatest cricket roadshow on the planet.

However, the auction system and its functionality/logistical viability is still a question mark. Starting bids may be a function of the minimum amount a player is willing to compete for but that would be unlikely, except for superstars. For example, the starting bids on day two of the auction, even for relatively well-established international cricketers, began at $50,000, and often didn't even generate a solitary bid from the franchisees. The risk component is high when an auction system is in place, especially for a sport dominated by the international calendar.

Collective bargaining and a player's association is still missing and this is a major reason why there is a risk of disproportionate bidding, skewed towards day one of the auction. This is also the reason why a majority of the international players generated no interest whatsoever from the teams. Across leagues globally, the role of collective bargaining and players' associations is to ensure parity between teams, but especially to protect the veterans and the debutantes from the vagaries of market forces and speculative star quotient overshadowing. Collective bargaining ensures that players are well-represented legally, fiscally and, of course, are looked after categorically rather than individually. Salary caps are fine but there also need to be wage floors, so that meritorious cricketers are not ignored or undervalued randomly.

A real cause for concern arises with regard to the 'uncapped' Indian players. Over the next season, the IPL Governing Council must address this. Ironically, the salaries for 'uncapped' players are too low, so the purpose of developing a farming system and supporting talented cricketers via exposure, income streams and career opportunities has become an oxymoron. As things stand, each team has a limit of 30 players to maintain a roster, of whom only 10 may be international players. With approximately 200 slots for Indian cricketers and approximately half of those with international experience, there are still 100-odd slots left for the so-called 'uncapped' players. The very fact that despite being in a position where the Pandeys and Rayudus would be in great demand and have an opportunity to set off a bidding war between the franchises has been nipped in the bud by the IPL Governing Council. With a cap of Rs 30 lakh for a 'veteran' Ranji player, there seems to be a discrepancy between the demand and supply dynamics. This could also set off a flurry of 'offline' correspondences and deals between the players and the franchise, triggering a repeat performance of the Jadeja fiasco from last year. The word 'uncapped' seems to have imposed an artificial ceiling on the opportunities for domestic cricketers who, incidentally, the foreign player limit of 10 was meant to support in the first place.

Beyond the ethics however, this is also detrimental to the interests and rights of the players themselves. There appears to be an unwritten rule whereby players must deal directly with the teams and the league, effectively barring any representation for the players. If this is indeed the case, then this could spell trouble. Effectively, the players' agents, managers, legal counsel or any combination thereof are neither allowed to negotiate on behalf of the player, nor are they allowed to review the contracts that the players sign with the league/team. This is troubling especially because this is unfair to the players, who are not only unaware of their rights and limitations but are also unable to solicit any assistance from their counsel/confidante's for fear of breaching the confidentiality provisions stipulated and having their contracts terminated.

Having said that, this is a learning process for a nascent league and teething problems are inevitable—as of course is the unfortunate reliance on trial and error. The fact remains that the IPL 4 has shown that it not only has the legs to carry it forward in the long run, but more likely than not, it seems to be sprinting towards the next phase. Over time, a structured draft system will be essential, and ICC will more likely than not establish a set of guidelines and regulations similar to FIFA and FIBA. These would spell out the restrictions and also ensure a set of parity promoting parameters, which would ensure that players who have committed to the international calendar won't be omitted from the IPL merely due to the patriotism that each cricketer is exhibiting.

That having been said, the return of IPL is good for cricket and, in the grand scheme of things, even better for India. The 'draught' mentality aside.

The content of this article is intended to provide a general guide to the subject matter. Specialist advice should be sought about your specific circumstances.

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