Indian summer to give true insight into Covid's 'new normal' for Cricket Australia funding

Cricket Australia’s position is far from as dire as once predicted, but huge challenges remain 

If the message about multi-year cycles, expected revenue dips and the need to smooth out cricket’s funding in Australia to cater for year-on-year fluctuations was more or less the same, the difference of medium provided a stark reminder of the new world into which cricket boards must now operate.

Cricket Australia’s AGM was held virtually for the first time, with its chair Earl Eddings and a selection of staff webcasting from Jolimont headquarters, while the interim chief executive Nick Hockley and New South Wales directors logged in from Sydney. Elsewhere the chairs of the state associations – CA’s technical owners – passed a constitutional resolution to add a 10th board director in Vanessa Guthrie and also elected the former NSW premier Mike Baird in place of the retiring Jacquie Hey.

The headline figure of a A$45 million loss for CA on the 2019-20 season, with its lower box office touring teams from Pakistan and New Zealand, was not in itself a surprise. In fact, CA had recorded a bigger loss in recent pre-Covid times, when it saw funds dip by A$51 million for the 2016-17 summer attended by South Africa and Pakistan. The morning’s key graphic, showing how Australian cricket relies so heavily upon inbound tours from India and England to turn profits above the money already committed to costs and distributions to states, reinforced the notion.

Unquestionably this was a world away from some of the projections made by the former chief executive Kevin Roberts back in April, when he suggested the possibility of CA going broke by August. Those kinds of contentions, made at a time that CA was standing down staff, applying for a credit facility and seeking deep cuts from the states and the players, have fortunately receded into the distance. That “crisis”, with the benefit of time, looks very much as though it was an inflated if not confected one designed to allow for cost cuts.

What was clear, however, was the fact that amid the global economic shocks provided by a pandemic, on the tail of what was already an increasingly uncertain global media rights market, past assumptions about how much a summer may be worth have already been tested and will be like never before this time around. India’s most recent visit in 2018-19 turned only an A$18 million surplus, as against a bounty of nearly A$100 million in 2014-15, albeit with a World Cup also in tow.

“For the growth of Test cricket we need to have something to aim for, particularly with some of those Test matches that don’t mean anything with some countries. This gives everyone relevance and context” Earl Eddings on the World Test Championship

The summer schedule finally confirmed with considerable fanfare on Wednesday will provide a more or less identical amount of content for broadcasters at home and overseas as was the case two summers ago: four Tests between Australia and India and six white-ball games. The measure of CA’s response to Covid-19 and also the sustainability of the four-year funding model will be whether it can turn a bigger profit this time.

“Media rights globally are under a lot of pressure, hence why we’re always refining our business models,” Eddings said afterwards. “I think the new norm if you like will be very different for all sports and organisations going forward, so as a board we’ll make sure we keep reflecting on what we think is the best business model. Luckily we’ve got great products in Australia, men’s and women’s domestic and international cricket, we’ve also got strong international partners who like showing Australian cricket around the world.”

Free-to-air commitment

Of course, Eddings said these words at the precise moment CA stands in an unprecedented dispute with its free-to-air broadcaster Seven, which has challenged the governing body to offer a major discount to the remainder of its A$450 million broadcast rights deal alongside the A$750 million contract signed with Foxtel. That overall A$1.18 billion deal, signed in April 2018, has been a source of many pressure points since, and tellingly made Foxtel CA’s primary broadcast partner, with rights to Tests and most of the W/BBL, plus women’s internationals, shared with Seven.

Eddings, though, insisted that free-to-air broadcast would continue to “underpin” CA’s broadcasting strategy. “We’re working behind the scenes with our partners around that, we don’t want to play it out in the media, but we’re confident of our position and we’ll deliver a full summer of cricket as we’ve always said we will,” he said of Seven’s dispute.

“I think we’re seeing the emergence of new technologies all the time. We’re also bound by anti-siphoning laws to play international content on free-to-air TV, so that’s a great reach for us, it gets our games and our players out to fans all around Australia, so free to air TV is very important. We understand that free-to-air TV is going through a lot of challenges at the moment, so streaming and digital are increasing, but free-to-air TV will always underpin the value of our TV rights.”

Keeping the show on the road

CA’s capacity to keep the global caravan of international cricket from teetering off a Covid cliff is of course at the mercy of health conditions elsewhere, as stressed by doubts around a tour of South Africa next year and the inaugural World Test Championship final scheduled for England soon after it.

“I think it’s great that England are going there [South Africa] and obviously we want to tour as well. As you can understand, in Covid times things change very rapidly, so we’ll be watching with interest,” Eddings said. “In the end it comes down to the safety of our people and that’s the most important priority for all of us. Where it’s safe to do so, we will play.

“I’d certainly like to see [the World Test Championship final] go ahead because I think we might make it. The UK is going through another peak at the moment, so our intention is to go over there and play, but that’s going to be subject to what the state of the nation is at the time and travel requirements.

“We’re all in favour of playing as much cricket as we can. We need to give Test cricket relevance and something for everyone to play for. Covid’s obviously had a big impact on that around countries being able to play each other. It’s going to be a bit glitchy until we get it right, but certainly for the growth of Test cricket we need to have something to aim for, particularly with some of those Test matches that don’t mean anything with some countries. This gives everyone relevance and context.”

Either side of the resignation of Roberts in June, CA had dispensed with 40 staff and made somewhere in the region of A$40 million in cost savings, as against a revenue hole that CA still puts at around A$120 million. At the same time, after a long and often fractious process, the state associations accepted a 12.5% reduction in their annual distributions (after originally rejecting a 45% cut), albeit with built-in upside should revenue be better than expected.

Similar arrangements have been made with the Australian Cricketers Association, and it appears, relationally at least, that CA is on the improve. Whether the states, personified by association chairs looking on impassively through their webcams as the game’s finances were presented, are wholly content with the game’s current leadership and structure remains to be seen.

Source: ESPN Crickinfo

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