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D. Sampathkumar

THE 1970s' Crazy Boys of the Games was a wonderful Hollywood spoof on the Olympic games of that era. There is a scene in the film, which lampoons the sham nature of the `amateur' status (a pre-requisite in those days) that athletes claimed for themselves in these games. The film shows a winning athlete proudly thrusting his chest in front of the television camera, to reveal in full view, his chest-number for the benefit of the television audience. The next shot has the television cameraman peeling off the chest-number to reveal the Coca-Cola Company logo hidden beneath.

The Olympic games have, however, come a long way since then from their obsession with the `amateur' status of athletes competing in it. In fact, international sports as a whole, have gone to the other extreme of professionalism and all that it entails insofar as commercial exploitation of sporting activity is concerned. The latest controversy in international cricket on product endorsements by cricketers that conflicts with the governing body's own arrangements of sponsorship involving competing companies is a fallout of such full-blown commercialisation of sport.

The International Cricket Conference (ICC), the body that controls cricket worldwide, has signed up with a number of commercial enterprises to enable the latter associate themselves on an exclusive basis with two key one-day cricket tournaments involving the entire community of cricket playing nations. The ICC has conceded to the sponsoring enterprises, which would be shelling out millions of dollars for the privilege, that players and their respective cricket bodies participating in ICC tournaments would not endorse any competing products for a certain period of time both prior to and after the conduct of the tournament.

The idea being: A popular sporting event enjoys a huge mind-share among fans in that sporting discipline. Now, they are also potential customers of a whole range of goods and services. A product by identifying itself with the event can ride piggyback on its popularity and exploit to the full, the profit potential inherent in such an association. If sponsors of the event can also guarantee that competing products would not clutter up the mind space of prospective customers with their own offerings, the advantage implied in the arrangement is even greater.

The ICC has sought to do this by imposing a condition that participating players and their national bodies should not associate themselves through endorsements any competing product for the duration of the tournament and also for a period prior to and after the tournament. This is supposed to prevent competitors of event sponsors from ambushing their marketing efforts of the enterprises sponsoring the event.

The dilemma has all the ingredients of `game theory'. If players sign the contract then they forgo the option of leveraging their popularity (in the case of some at least, enhanced by their performance in the tournament) to generate personal profits. If they refuse to sign, then the tournament is either cancelled or conducted without some of the more popular members of the respective teams. Either way, the tournament loses its significance in popular perception leading to the sponsors refusing to fork out the promised amount. In the event, both the players and the ICC lose.

From a marketer's point of view, the players represent an eminently valuable property. Ideally, they would like nothing better than have these players endorse their products. But if that were not possible, they would at least prefer that their competitors do not get to enjoy that privilege. The clause against `ambush marketing' in a sponsorship deal seeks to do precisely that.

From the ICC's point of view, what it has tried to do is to bundle a set of cricket players into a marketing package and then offer them as a proposition in product endorsement. The value in question here is a promise of non-endorsement by these players a competitor's products for a certain duration and for which they negotiate a fee. The process of bundling should result in a hard bargain with merchandisers who have something to sell. Viewed thus the players would be better off in terms of securing a higher value for their endorsement/non-endorsement. Of course, the more popular ones would be cross subsidising the relatively lesser-known players. But graded payments should mitigate this drawback to some extent.

So the ICC and the players should play the game in a spirit of cooperation to maximise their collective pay-offs.

But from the point of view of the society at large, it is not a satisfactory arrangement. Not all the revenues get passed on to the players. The portion that is withheld might be parked in some tax haven as the entity doing the bundling could be registered in a tax haven. In the instant case, the ICC agreement has been negotiated by a subsidiary incorporated in Isle of Man — a tax haven.

In contrast, had the agreement been negotiated individually by the Tendulkars and the Gangulys of the tournament, the pay-offs would have accrued entirely to the players themselves and the respective governments too might have been richer by the amount of taxes due on such incomes.

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