BCCI's Bodyline Bowling: Attack of a Monopolist

Update [7 Sep] -

The anti-monopoly watchdog in India, the Monopolies and Restrictive Trade Practices Commission (MRTPC), has initiated an investigation against the Indian board over its reported threat of a life ban to players joining the Indian Cricket League (ICL).

See BCCI faces monopoly investigation

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The rebel Indian Cricket League (ICL) has been grabbing headlines for a while, and the war of words between ICL and the BCCI has been escalating. Courts have given verdicts, current and former cricketers have taken sides and the media has played its part in sensationalizing the story.

The discussion so far appears to have focused mainly on the ICL's role as an unlicensed, unaffiliated body that is promoting itself without knowing exactly what it wants to be - is it a complete alternate cricketing structure? Is is a 20-20 cricket league? Is it an opportunity for players long on the fringes of the BCCI's national team, forever ignored by the selectors?

From an economics perspective, it is none of these. In pure economic terms, ICL is a competitor challenging what looks like an established monopoly. It is instructive to identify the market that the monopoly operates in and conduct a proper analysis.

The BCCI's "business interests" are mainly in selling broadcast rights (television, radio) of live cricketing events, selling official merchandise, tickets at the grounds and so on. Of these, the broadcast rights are the major revenue earner and the most contentious issue. The ICL's chief sponsor, Subhash Chandra, started it only after failing to match or exceed a bid for the rights to telecast BCCI events on his channel, Zee Television. Let us focus therefore on the "broadcast rights" issue, the main revenue source for the BCCI and the bone of contention in this debate.

Starting with the antitrust basics, what is the "market" that the BCCI has allegedly monopolized? How can it be properly defined? How can antitrust economics be properly applied to determine whether the BCCI possesses or is attempting to illegally maintain a monopoly?

"Broadcast rights" are a revenue source because they in turn enable television, radio or other media that acquire these rights to sell "advertising slots" to advertisers. Thus, in essence, the BCCI is merely a "content provider" that enables advertisers to show messages to a specific audience (one that is interested in cricket matches). Thus, the right economic analysis is NOT "control over cricket played in India" - but rather, the sale of "advertising slots".

Any analysis of monopoly must begin with a proper market definition. The next question then is whether an alleged monopolist has "monopoly power" in this properly defined market. The usual analysis begins with the "narrowest" market definition and applies the "Small but Significant Non-transitory Increase in Price" (SSNIP) test. The central question is: can an alleged monopolist in the properly defined market "profitably" implement a SSNIP? If the answer is yes, the analysis proceeds by expanding the market definition until a SSNIP becomes unprofitable. If the SSNIP is profitable only in a very narrowly-defined market, the "market power" held by the alleged monopolist is negligible, and thus, does not satisfy the "monopoly" criterion. [Note: If the market is already monopolized, a SSNIP may not be profitable since substitutes may be relevant at the monopoly price. The correct analysis however is to consider demand substitution at the "competitive price". See SSNIP and cellophane fallacy].

Let us consider the smallest market that the BCCI operates in - this may be defined as the "advertising slots" for a single match involving a BCCI-approved team (India, India A etc.). Can the BCCI profitably implement a SSNIP in this market? It is possible - especially if it is a match that has few substitutes (e.g. a world-cup final involving India, an India-Pakistan match of importance etc.). However, defining a market as a "single match" does not permit analysis of any increase in price as "non-transitory" and is more akin a one-time event, a single round of a multi-round game.

Broadening the definition, let us consider advertising slots for "matches involving the official BCCI India team" over a substantial length period of time. At present, BCCI has a monopoly over these advertising slots, through its ability to control the broadcast of these matches. Given that BCCI's team is widely acknowledged as the "Indian National Team", it is clear that there is no perfect substitute. Now consider some of the substitutes available to the advertisers:

• International cricket matches not involving India - Given an advertiser that is attempting to promote her product in India, these appear to place no constraint on the BCCI's ability to profitably implement a SSNIP. A SSNIP in BCCI's charges for broadcast rights will not result in the advertisers taking their business to an Australia-Pakistan match (the quality of cricket played may be better - but from a pure economic perspective, the advertiser cannot substitute the size of the audience for an India match by advertising in such matches).

• Cricket matches involving other "India" teams - These are also under BCCI's control and therefore not valid substitutes.

• International sports events involving Indian teams or individuals - No other sport in India matches the popularity of cricket. The prices for advertising slots for non-cricket team sports- football, hockey, or other team events or individual sports - tennis, billiards, chess - etc. are "much below" than those for cricket. A SSNIP in cricket advertising slots may push some advertisers towards these other sports - however, the SSNIP will still likely be profitable.

• Other advertising slots - "sporting events" attract a certain audience - and advertising for with other content (e.g. television soaps, sponsored television shows, reality television or game shows, live concert telecasts, movies) is an imperfect substitute for cricket advertising. The per-second rates of some of these events may be comparable (e.g. the Filmfare awards) - however, the target audience reached by cricket is not duplicated by these events.

• Not advertising through these media - clearly, no advertiser will "fully withdraw" advertising from television or other media in response to a SSNIP by the BCCI.

It is apparent that the BCCI wields "monopoly power" in the "advertising slots for cricket featuring Team India". In fact, an even broader market comprising "advertising slots for cricket featuring teams from India" may be monopolized by the BCCI.

The effects of a monopoly can be seen along dimensions - increased price (already seen in the advertising prices), reduced consumer choice (variety) and reduced quality.

The reduction of variety is obvious in world cricket, especially in comparison with other team sports. Unlike other sports such as soccer or basketball, cricket does not have "club teams" that are composed of talented players drawn from the various countries that play the sport. Unlike basketball - in which the NBA, US College Basketball and international basketball - all follow different rules and therefore, provide variety, cricket is confined to the ICC's rules. The pace of innovation has been slow (e.g. 20-20 or fielding restrictions in ODI cricket etc.), and has often been a response to challengers (e.g. The Kerry Packer alternative is credited with several innovations such as coloured clothing, day-night matches, limited overs cricket etc.). The number of international stars in cricket is capped by the number of international teams playing the sport and also the strength of his team. Thus, many high quality Aussies, Indians, Pakistanis etc. must wait their turn (sometimes for over a decade) to play for their teams while lesser players get the opportunity to compete internationally for teams such as Bangladesh, Bermuda or Zimbabwe.

The reduced quality came to the fore during the most recent cricket world cup. By including several fringe team (under the presumed goal of "developing the sport"), the world body permitted teams that wouldn't be competitive at the club-level in Australia, England or India, to compete with much superior teams, resulting in a large percentage of one-sided games (of reduced quality to consumers interested in watching a keenly contested match). Such mismatched contests are omnipresent in the present structure of cricket.

[One must acknowledge here that the pride of seeing a "national" team compete may not be substituted by city, county or club teams. However, the soccer example - with its immensely popular club teams - and a world cup every four years - proves that alternate structures that preserve international teams while allowing club teams to prosper are feasible.]

The BCCI's pronouncements after the announcement of the ICL and the unveiling of its initial list of players may then be seen as efforts to maintain its monopoly. The BCCI raised salaries for its players in domestic teams (as an employer of cricket players, the BCCI possesses "monopsony" power - i.e. it is the sole source of demand for cricketers), it threatened players with a life ban and that they would not be allowed to represent "India" (raising barriers to entry), it declined to make its stadiums available to the ICL (raising barriers to entry) and even roped in the ICC and other boards to prevent their players from joining the rebel league. It also barred coaches and officials joining the ICL from any current or future ties to "official" Indian cricket (e.g. Kapil Dev was removed as the head of the NCA, past-player's pensions were threatened).

The BCCI is bowling a lot of deliveries that would be considered "unfair" competition at a minimum (and "illegal" under several countries' laws). Let us hope that the ICL successfully ducks some, hooks other to the boundary and overcomes this "bodyline" attack to deliver some spectacular cricket!

Flowers

My eyes struggled to adjust to the darkness of the theater as I entered. The darkened space also had an invigorating smell - "dhoop" - incense was being burned. I noticed ornate, circular stone vessel at the center of the room, with a narrow platform hanging above it. Spotlights were trained on the vessel which was filled to the brim with water and white flowers. The light reflected off the water and illuminated the platform slightly. A figure draped in a white cloth was sitting at the far end of the platform, leaning against a few steps that separated it from us. That was Rajit Kapoor, the lead - and only - actor performing Girish Karnad' new play, "Flowers".

There were murmurs all around. The small theater was packed to capacity. The stage was surrounded on three sides by the audience, their eagerness apparent as the hour neared 7 pm, the scheduled beginning of the performance. Precisely at that time, the music started. Sparse, serious tones interspersed with the sounds of crickets chirping. The figure in white got up, turned around, carefully climbed down the two steps that separated it from us in the audience, and the performance began.

It is near midnight, the Priest said. He was looking disshevelled, even in a smart dhoti and angavastram. His face seemed weighed down with some great worry, while his tone tried not to betray any of it. The stars were in the sky, and the Scorpio it seems, was about to enter the water.

The priest narrated his story, maintaining a level tone. The platform was an extension of the temple, surrounded by water. It was a Shiva temple, where God takes the form of a Lingum. The priest's story was one of a powerful romance that drew him in and wouldn't let him out. A love that seemingly destroyed his routine life, and brought him to this night, narrating his story as he contemplated his life.

He loved his wife he said, and respected his chieftain. As the temple priest, he worshiped God above all else. He spent hours alone with God - discussing things important and mundane. His many hours of the day were spent decorating the idol with flowers. He conducted every ritual with great attention to detail. His life had a steady rhythm, of devotion, of ritual, of complete devotion. His routine was disturbed in the strangest of ways, when a courtesan visited the temple to seek blessings during a week long celebration. What followed were events unlike anything one could imagine, and brought him to this night of rigorous self-examination.

Girish Karnad's latest play is a monologue. It is a timeless story, set in no particular place. It plays on the themes that have dominated his work - the nature of God and religion, virtue and morality and the dilemmas associated with these. It is the sparsest of his works, distilled to a bare minimum. Yet, it is powerful and unforgettable.

Rajit Kapoor's performance was masterful. The tone of his voice, the strength and fragility it conveyed, the manner of speech - accelerating in excitement and slowing down in love - and the way he crossed and uncrossed his legs all made one forget that it was a play and he was an actor. The audience was mesmerized and transported to this timeless world. The minimal lighting and sound were in keeping with the nature of the play.

An hour and a half later, when the performance finished, the audience was in a trance. It was a theater experience unlike another. I felt fortunate to witness it.

The Rockstar Historian

I just returned from the publication event for Ramachandra Guha's India After Gandhi. Guha gave a wonderful account of his book and its main characters. In style and manner, his speech was nothing short of a rock performance. His eyes, the nervous energy of his movements, rapid speech interspersed with sips of water and a booming voice, combined with a mastery of the subject at hand - Ramachandra Guha is as wonderful a speaker as writer. He conveyed the essence of the book, some of the best stories, and the primary evidence for some of his striking conclusions, and most of all, his command over the subject. All in all, Ramachandra Guha has rockstar appeal coupled with a historian's studiousness.

A rare and valuable combination indeed. Time to read the book!

Thane Mayor's Half Marathon (Varsha Marathon)

Today, I walked the half-marathon organized by the Thane city mayor. It was supposed to be flagged off from the Thane Municipal Corp. headquarters at 8.30 am. I reached there on time, but the race start was delayed for multiple reasons. I also had not entered officially for the race. Thus, I started off along the race route on my own at about 8.45. I had already decided that I would walk the whole distance, may be run a little bit for fun.

The route was - TMC - Highway service road to Teen Haath Naka - LBS Marg to Mulund checknaka - Wagle Estate - Kores Colony - Vartak Nagar - Pokhran #2 Circle - Vasant Vihar - Ghodbunder Road - highway service road to Teen Haath Naka - Hari Niwas - Back to TMC. A big chunk of the route was new concrete streets, other parts were half done tar roads or roads full of potholes (or pot-wells or pot-lakes!). Along the route, there was the new Thane to see - the tall apartment buildings, with commercial security and the new stores that had replaced the old factories, mixed with older, smaller, dilapidated-looking buildings yet to be replaced, and some jhopdis. The route went all the way to the foothills of Yeoor and cut through a fair chunk of the new Thane across the highway.

Some sundry notes, in no particular order:

I was pleasantly surprised at how well the initial stretch of the marathon was set up. Road blocks had been erected, there were signs at every kilometer, and there was police presence at every major intersection, stopping vehicles from entering the route. There were also a lot of Palika Safai workers, who apparently had just finished cleaning roads along the route. Only some traces of the garbage that usually lines some of the streets could be seen. There were also several waiting spectators.

I walked the first 4-5 kilometers by myself, before the real participants in the race passed me, near the Yeoor foothills. The lead runner, and several others chasing him at that point were barefoot. There were quite a few women also running (I counted a total of about 25-30 that passed me).

The barefeet runners were easily identified by the slapping sounds their feet made against the roads. The runners with sneakers by contrast, made a much softer sound.

The course had way too many potholes, little stones, and other hazards along the road to be running barefeet. The hard surface of the tar and concrete couldn't have made it any easier. Kudos to all those barefeet runners!

I am quite sure thousands of rupees were spent on the huge banners all around the city, with huge images of Uddhav and Bal Thackeray, Anand Dighe, Mayor Rajan Vichare, all and sundry local sena leaders, and even, Matoshri Thackeray, and Matoshri Dighe. There were also two large shamianas at the starting point, a huge sound system to drum up enthusiasm, and so on. Why didn't some of this money go to support the lead runners who were running without shoes on? The stated aim of the marathon was to prepare state runners for national and international events. Couldn't proper gear be provided, at least to the lead runners? (It appears that the only group of elite runners that had some shoes on were from the Army). The money spent on erecting huge banners of people who in their entire lives have probably never participated in any significant athletic activity, let alone a marathon, could've been better spent that way. Shiv Sena, and Shiv Sainiks, are you listening?

Apparently, more than 50,000 participants had registered for the marathon. No more than 500 must've passed me by the time I finished the race. Where did all these people go? (Well, there are some answers: There were not 50,000 participants for the full distance - the women's race ended at the 15 km mark, the children's race was even shorter, the senior citizen's race was a couple hundred meters at best, and most vitally, the participation numbers were inflated by the compulsory registration of schoolchildren from the municipal schools. Again, the publicity needs of having organized the largest marathon ever triumphed any realities!

A big thank you to the much maligned and oft neglected civic workers - police personnel, safai workers and the numerous other city officials who contributed to the event. The police and safai workers had been out in the rain since 6 am, making arrangements.

Apparently there is another marathon this coming weekend (30th July). The Mayor's Varsha marathon was a Satish Pradhan promoted event for the past 16 years. Now that he has switched from the Shiv Sena to Congress, it seems he's taken the marathon with him. So one week after the Sena-sponsored marathon, there's going to be a Congress-marathon. Amazing that the civic authorities can be subjected to the stress of hosting two marathons, for such petty political reasons

By my obervation, the largest cheering crowds were in the lower middle class areas, where people were on the streets in huge numbers. They were enthusiastic, cheering everyone on with "Come on", "Bhaago", "Run" and so on. By comparison, near large apartment buildings like Kores, Runwal and Hiranandani complexes, hardly anyone noticed the runners.

Heavy rains started around the time I was near the 16 km mark, and continued for about a half hour. Incredible to walk in such rain! Fortunately, during most of this time, I was on the pothole-free stretch.

Around the 19 km mark, my thighs started cramping up. At this point, I had to start running, for that was the only way to avoid the pain in the thighs and keep going.

Oh, yes. My time for the half-marathon distance was 3 hours 5 minutes.

Wake Up: AR Rahman with 150 All Stars

I went for this concert yesterday evening, at the Eastern Michigan University convocation center. AR Rahman (as with many other people) is my favorite Indian music composer from the present times. I was curious about the concert, knowing that he wasn't on a big tour with a lot of Bollywood personalities, but rather performing with 150 all stars.

The all stars, apparently, were students from EMU and from Miami University, Ohio. They had learned and reinterpreted Rahman's music in their own style. It was a refreshing look at Rahman's music, performed in a style alien to Bollywood.

Choir singers, a four-violin and cello string section, many drums and cymbals, a tabla, flute and keyboards (Rahman) formed the orchestra, conducted by Ethan Perry. The concert began with a very powerful rendition of "Ramta Jogi" and "Taal Se Taal Milaa" from Taal. The mostly Indian audience was a little surprised by the multiracial group, singing in perfect Hindi. Their voices were strong, and a little different in key from the originals.

The concert proceeded on an interesting pattern - live music and choir-style singing of Rahman's songs, interspersed with "karaoke" of Rahman's recorded music with live singing by Rahman himself, Vasundhara Das, and a couple of young singers from the choir. It even included a dance performance that used Rahman's "Rang De" from a CD! On the whole, an odd mix of performances!

The choice of songs in each particular style was very good. The choir performed some songs obviously suited to their style (Veerapandi Kottayilae, Thee Thee, and a fabulous rendition of Zikr), Rahman and Vasundhara Das crooned/ lip-synced some songs (Khalbali, Dil Se Re, Maa Tujhe Salaam for Rahman; Shakalaka Baby, Ik Onkar, Yaaro Yaarodi for Vasundhara Das). The young white American who performed "Rang De Basanti" was fabulous - with his "twanged" punjabi; the group of girls who performed "Paathshaalaa" fit the rebellious mood of the songs well.

On the whole, an enjoyable experience.

Some notes from the concert

- Rahman seemed to be enjoying himself, listening to the choir perform his songs in a new style. He appeared to be intrigued by the idea, and impressed by the results.

- After almost every song, a different announcer came on stage and heaped lavish praise on Rahman - talk about beating your own drum (and also, "preaching to the choir!")

- The EMU president made a speech welcoming Rahman and his music to the institution. After the intermission, Rahman was handed a key to the city of Ypsilanti by the city mayor. Quite a honor!

- It was announced that Rahman is funding and providing other support for the first "Conservatory for Western Classical Music" in India, to be set up in Chennai.

- Indians in America don't seem to behave very differently from those back home. There were more catcalls, whistles, rude gestures, and other kinds of bad behavior than any other event I have attended in America. I wonder what it is that makes us such bad spectators.

- The global nature of music was made amply obvious. As the choir singers of many backgrounds twisted their tongues to get the Tamil and Hindi sounds right, I thought of the quite unreal scene in front of me. I have witnessed Western Classical concerts with a multiracial orchestra. I hadn't imagined seeing such a performance of popular hindi music. It was inspiring to see that so many young people of diverse backgrounds found this music enjoyable, and could perform it so well! Seems like great days are ahead in terms of musical collaboration around the world!

Breaking the spell

Daniel C. Dennett, the author of The Mind's I and Darwin's Dangerous Idea, among other books, was at the University of Michigan yesterday with a lecture introducing his new book Breaking the spell. It was a highly entertaining and humorous presentation. His juxtaposition of the pictures of thousands of people gathered at the Vatican and Mecca, participating in religious ritual with those from the super bowl and other sporting events had the audience in splits.

The new book proposes a scientific study of religion. Hirak has posted an excellent summary of the presentation.

The Lone Surfer Tour 2005

Yesterday evening, I went for Davy and Pete Rothbart's (buddies from my ultimate frisbee group) "Found" show. They had been on tour across North America, doing shows in 51 cities in 54 days (wow!). The tour was to promote Davy's (awesome) new collection of short stories "The Lone Surfer of Montana, Kansas" and to share and collect new "found" stuff.

Davy puts out the "Found" magazine - a collection of notes, to-do lists, letters, diaries and all kinds of other things - lost by their authors, and subsequently "found" by someone else. It is a rather odd concept - printing a magazine of found objects and creating a show based on it. Davy makes it work and how! He imagines the remainder of the persons' lives, from the snippet that he gets to see. He writes stories about them. He weaves their notes into anecdotes, and some ribald comedy. And Pete writes songs, sometimes based on found stuff, borrowing and extending lyrics, and adding his own touch, to create songs such as "Damn! The Booty Don't Stop" (You've to hear it performed live! Its awesome, vulgar, funny, an absolute blast!!). Together, they are terrific entertainment!

Davy's book, "The Lone Surfer of Montana, Kansas", is a collection short stories. Here's what he says about his inspiration for the title story, and his book:

A few years ago, I was driving on a small two-lane highway through rural Kansas when I saw a bizarre and riveting sight—-a teenage kid had slung a surfboard between two dead tractors in the middle of a cornfield and was balanced on top, like he was practicing how to surf. Here he was, thousands of miles from either coast, the sun setting in glorious colors behind him—-I was mesmerized and sat there watching for ten minutes or so, and then I drove away; I don’t think he even saw me. But that image of him surfing in the cornfields stuck with me, and my curiosity about him kept growing more intense, so finally I decided to write a story about him, imagining what his life was like and what might have happened had our paths intersected. I called the story The Lone Surfer of Montana, Kansas (Montana is the name of a tiny town in Kansas) and it’s the title story of my new book.

I just finished reading a few other stories from the book. They are really good. The heroes of Davy's stories are mostly young men who haven't found a path in life. Narrating in the first person, Davy provides the reader a close-up of his characters. Davy's stories are set in odd places across America - an old people's nursing home in Florida, a strip joint in a Mexican border town, a prison in Michigan, and in the title story, rural Kansas. The characters are raw, their language coarse, and their feelings out in the open for anyone to see. They are humane, rough, compassionate, mean, lost. And just when it seems that they've "found" themselves, the world seems to crumble around them. Thus, a lost love, a sad father, and a congenitally lying dead friend. Davy's characters don't find redemption - that would be too easy. Rather, they are left alone to themselves. In a way, the stories are just like the found stuff Davy works with - snapshots of a stranger's life, accidentally found.

Hats off, Davy! (and yeah, see you on the field soon!)

Grand Canyon Trip

The last weekend of August, I hiked the Grand Canyon - rim-to-rim. The travelogue and a few pictures are here. Comments/feedback welcome.

Grand Canyon is awesome. A must-do hike.