Why English cricket faces a 'sliding doors' moment - Sportcal

Why English cricket faces a ‘sliding doors’ moment – Sportcal

Posted by Admin May 22, 2024 Cricket

The ECB launched the Hundred in 2021 and now intends to sell off a sizeable proportion of each team to private equity investors. (Julian Finney/Getty Images)

Sliding Doors is a British film released in 1998 whose cultural influence reaches far beyond its modest box office performance. It has become a synonym for small moments and events that determine the future direction of a whole life.

The current decisions to proceed with the plan for outside investment in the teams participating in the Hundred (the England and Wales Cricket Board’s top-tier short-format county game) may prove to be English cricket’s “sliding doors” moment.

On the face of it, it’s a simple matter of allowing outside investment into the eight host venues/counties in the current Hundred competition – at first through the sale of an ECB stake of 49% in each team, and then potentially some or all of the other 51% owned by the host venues. The rest of English domestic cricket stays the same – the County Championship, the T20 Blast, the One Day Cup, as well as international fixtures.

Even the on-field format of the Hundred (which launched in 2021 with eight teams across both men’s and women’s editions) will stay unchanged for now, with a review of possible expansion to 10 teams delayed until at least 2028 (to coincide with the end of the current broadcast cycle).

If the Hundred proves to be totally additive in terms of revenues to English cricket, for example through TV deals and sponsorship income – and has no significant negative effects on the costs of the rest of cricket (such as player fees, availability, and contracts) then it’s possible that the decision to proceed with outside investment will prove unambiguously beneficial for the game.

If the pie gets much bigger it should be possible to make the whole sport better off – from grassroots to the smaller first-class counties, to the England team.

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Specifically, if the 11 counties without a Hundred team at their venue get a reasonable share of the monies made from the sale of the ECB’s stake, and perhaps a share of the monies made if and when the hosts sell off more of their own stakes, then an 18 county system could remain sustainable.

Most of all, it could help English cricket respond in part to the growing dominance of Indian cricket and the Indian Premier League (IPL) in the world game, by creating the world’s second most valuable short-form competition – even if it remains a long way behind the IPL.

However, if the revenues are to a large degree substitutional – to the T20 Blast, the domestic 50-over competition, One Day Internationals, or even Test Cricket – it will quickly hasten the demise of the smaller first-class counties in England, many of whom are already struggling financially.

These counties rely to a large degree on ECB handouts from the revenue that the central body makes from selling media and sponsorship rights to international men’s and women’s cricket.

The total English cricket pie could still grow, but the smallest and weakest would go to the wall – not just because of falling revenue to the 18-county T20 Blast (which is the only domestic competition that most counties make any significant money from) but because the ECB might have less remaining central revenue from its media rights sales with which to cross-subsidize the weaker parts of the sport.

If, in addition, the counties find it impossible or more expensive to retain the limited number of top players who participate in the T20 Blast, the 50-over competition, or the County Championship, then a downward spiral in the sustainability of the rest of cricket could soon result. This might, in fact, prove impossible to prevent, even if the non-host counties get the lion’s share of any sale proceeds from the ECB’s stake sell-off.

Much has been made of the current assumed media revenue for the Hundred competition – an allocation in the business plan of the current central media deal amounts to circa £50 million. Indeed, the sale value of the teams depends a lot on the assumption that this could grow to £90 million in 2028 when the next deal comes up.

However – just as important is how much of this £90 million is new money. Much has been made of the increased squad budgets for the Hundred as its income rises, but if this pulls players out of other English competitions, this might compound the problems for the rest of the game.

All sports are ecosystems, and we should not look at any one competition in isolation. Just look at top club rugby in England – which gained a significant cash injection in return for 20% of its central revenues, and then three years later saw three of the 13 clubs go to the wall financially.

If the Hundred proves to be all additive everything else (in terms of English cricket) might stay the same – while if it proves to be somewhat substitutional everything else will have to change. English cricket faces its “sliding doors” moment this summer.

Oliver & Ohlbaum Associates is an independent strategy advisor in the media, entertainment, and sports sectors.