Australian sport possesses an undeniable ability to inspire, amaze, and bring immense joy. However, it also harbours a peculiar knack for administrative decisions that leave one scratching their head, questioning the rationale and the ‘why’ behind them.
This sentiment rings particularly true in the current landscape of Australian cricket, with the proposed privatisation of the Big Bash League (BBL) and the perplexing decision by Cricket Victoria (CV) to merge the Melbourne Stars and Renegades before even initiating a sale process.
The BBL’s Enduring Success and Evolving Landscape
Launched 15 years ago, the BBL has, by no means, been a flawless entity. Yet, its success has been nothing short of outstanding. It was a decision of remarkable foresight by James Sutherland and the Cricket Australia administration of the time, proving to be the single most valuable commercial act for Australian cricket this century. Beyond securing lucrative broadcast rights, the BBL has opened a vital new audience for the sport and introduced a host of talented players to the Australian public who might otherwise have remained in the shadows of Sheffield Shield cricket or the more obscure reaches of club cricket.
However, the world of T20 cricket has undergone a profound transformation since the BBL’s inception. Fueled by the immense financial power of the Indian Premier League (IPL), ultra-short-form cricket has become a global phenomenon. The BBL no longer enjoys the exclusive claim to the Australian summer window. A growing number of competitors are vying for a piece of the action, often offering more attractive deals to marquee players than what the BBL can currently provide.
Private Capital: A Welcome, Yet Complicated, Proposition
Against this evolving backdrop, the infusion of private capital and entrepreneurial spirit into the BBL should, in principle, be a positive development. Credit is due to Mike Baird and the Cricket Australia board for pursuing this avenue. It’s worth recalling that one of the most significant positive developments for cricket in the last half-century was the arrival of Kerry Packer and his substantial financial backing. In today’s climate, this is arguably a more constructive approach than relying on gambling revenue.
Cricket Victoria’s Bold, Perhaps Reckless, Move
Despite the potential benefits of private investment, Cricket Victoria’s decision to dismantle 15 years of brand investment and fan base development in the Stars and Renegades franchises, prior to commencing any sale process, appears, frankly, impulsive and commercially naive.
Exploring Potential Justifications for CV’s Decision
What could possibly be the reasoning behind CV’s unconventional approach?
Inside Knowledge of Buyer Preferences: One possibility is that CV possesses insider information that the wider public lacks. Perhaps they have been discreetly gauging market interest for some time, and potential buyers, possibly Indian IPL franchise owners, have indicated a desire for a clean slate.
- CV might be envisioning a new team, with a fresh identity, specifically targeting Melbourne’s growing Indian population and playing at the iconic Melbourne Cricket Ground. The recent US$1.65 billion (approximately A$2.34 billion) paid for the Rajasthan Royals undoubtedly sparks envy. However, if the BCCI continues to prohibit Indian players from participating in the BBL, it remains to be seen whether local Indian fans will wholeheartedly embrace a new team solely based on an Indian owner. There’s a strong possibility they won’t.
Emulating the Scorchers’ “One Team Town” Success: A second potential rationale could be the hope that merging the Stars and Renegades will foster a more unified “one team town” franchise, akin to the successful model employed by the Perth Scorchers. This perspective, however, seems to overlook or misunderstand the historical context of the Stars’ lack of silverware. A significant factor was the frequent call-up of top Stars talent for national One Day International (ODI) duty precisely when BBL finals commenced.
- Furthermore, being a “two-team town” has hardly hindered the success of the Sydney Sixers. The question then arises: would a new investor be inclined to inject substantial funds into a new Melbourne franchise devoid of local talent, which has presumably been siphoned off to create a new dominant team replacing the Stars?
A Flawed Auction Strategy
Even if CV’s commercial objectives are acknowledged, their chosen method for conducting an auction process is highly questionable. The established and most effective strategy for maximising outcomes and facilitating informed trade-offs is to maintain flexibility and keep options open for as long as possible. Restructuring the commercial offering should ideally occur at the conclusion of a process, not at the outset when crucial market information is still lacking. A more prudent approach would be to inform prospective investors that the dismantling of the Stars and Renegades brands, after 15 years of investment, will be considered, but only if they offer a price that adequately compensates CV for such a drastic measure.
The Perils of Being the First Seller
There is also a substantial likelihood that CV, as the inaugural seller of a BBL licence, will secure a less favourable deal. In the absence of established pricing benchmarks, their transaction will inadvertently set a precedent for other states to surpass when they eventually enter the market. Historical patterns in sequential auctions within new and opaque markets indicate that sellers in the middle stages of the process often achieve the most advantageous outcomes.
Moreover, the primary certainty for the first buyer is that they will own a franchise that competes against seven others, all operating under the rules established by the entity that is setting the rules for the competition itself. From an investor’s perspective, facing such a risk profile would naturally lead to a discounted offer. While it’s possible they might not, and CV could be hailed as visionary if a deal is struck, the odds are stacked against them. The outcome of this process carries significant weight, not only for Victorian cricket but for the broader Australian cricketing landscape. A Melbourne-based team represents one of Cricket Australia’s most valuable assets.
Accountability and the Future of Cricket
The critical question that demands an answer is: who is orchestrating these auctions, and for whose ultimate benefit? While state associations currently own BBL teams, the allocation of proceeds remains a point of contention. If these funds flow directly to state associations, does this truly serve the best interests of cricket? Such a scenario risks exacerbating existing inequalities, favouring already affluent states, and raises doubts about their capacity and temperament to manage these funds for the long-term prosperity of the game. If Cricket Australia is to receive the proceeds, it is highly unlikely they would passively permit state associations to conduct sales processes on their behalf for what will be their most significant commercial asset for the next half-century.
It is imperative that Cricket Australia reasserts control over this process and manages it directly for the overarching good of the sport, free from pre-emptive decisions made by other parties.
Reinvestment for the Grassroots
As private investment inevitably flows into the BBL – and it is my firm belief that all states will eventually succumb to the compelling commercial logic – there will be no shortage of hands seeking a portion of the spoils. Given the enduring challenge of maintaining relevance in the modern sporting landscape, cricket desperately needs this capital reinvested in its grassroots.
This represents a unique, strategic capital asset for the game. It should not be squandered on short-term windfalls, such as distributing a share of the proceeds to elite players, many of whom have limited BBL engagement or are nearing the end of their careers.
These proceeds must be invested and grown for the future of the game, not for the present or the past. Leading players, with a genuine concern for the long-term health of cricket, should undoubtedly concur with this sentiment.
John Wylie AC is the former chair of the MCG Trust and the Australian Sports Commission, and the founding deputy chair of the Melbourne Stars.
