ICCs Ouster Ultimatum Rocks Bangladesh Cricket

The decision of the BCB not to send their team to play matches in India escalated into a situation that has major implications for Sponsors Contracts, Television Rights, and Cricket's footprint in South Asia.

For the businesses connected to the $5B+ Global Economy ($5B is the highest revenue sport), this means that it is not just a sporting event - this is an economic supply chain disruption for all the manufacturing, betting, and broadcast companies related to Cricket.

There are many political issues surrounding these events arising from the recent leadership change at the BCB and the additional issues surrounding this situation; however, the ultimate outcome will be monetary and not just reputational. Therefore, let us thoroughly review this situation from all angles, starting with its effects on Cricket and its Stakeholders.

Roots of the Standoff: Politics Meets Pitch

The Bangladesh Cricket Board and interim government did not consider sending any Bangladeshi players to play in India due to ongoing security concerns, as there have been no tours to India since 2015. After the Kolkata Knight Riders dropped Mustafizur Rahman, the BCB insisted that group swaps be made for teams touring from Ireland (which play a majority of their matches in Sri Lanka). However, the ICC declined their request, based on an independent security evaluation stating that there is "low to moderate" risk for travel to and from India.

The President of the Bangladesh Cricket Board, Aminul Islam Bulbul, stated that 24 hours was not enough time to make a difference between now and the end of this series. He vowed to find alternative ways to send Bangladesh players to India. He even considered co-hosting the event with Sri Lanka. Asif Nazrul, the Youth Adviser of the BCB, reiterates his belief that India skipping tours of Pakistan sets a precedent for the current situation. The ICC board voted 14-2 in favour of keeping orthodox venues for games, based on the need to preserve the integrity of ICC's schedules.

Business Hit: Bangladesh’s $100M Cricket Economy at Risk

The Bangladesh cricket industry contributes more than $100 million annually to their economy through BPL sponsorships (Robi and Grameenphone) and tourism. Being removed from competitive play will mean losing 20-30% ($100 million-$150 million) from the ICC revenue-sharing programme, endorsements on major players like Shakib Al Hasan, as well as decreasing jersey sales.

Brand dilution occurs for sponsors and 200 million viewers disappear for broadcasters, cutting advertising prices in the South Asia region, where Bangladesh attracts approximately 20% of viewers. Companies like Beximco, the BCB’s sports kit supplier are experiencing adverse effects from their garment industry. It accounts for approximately 70%-80% of their total exports, due to strong ties with the sports merchandising sector. On a global scale, Star Sports and betting companies are lowering their revenue forecasts, resulting in potential losses of $50 million in regional rights value.

Global Cricket Business in the Crosshairs

• Due to its revenue structure heavily weighted towards India (72%), the ICC is highly vulnerable to revenue loss as a result of interruption.
• Scotland has provided an opportunity for ICC to present itself in a more global capacity while reducing their ability to develop business in the growing international marketplace.
• There was a 15% decline in the viewership of the last T20 World Cup. The teams did not participate fully. There are historical instances of hybridised venues including the UAE as a neutral site in Pakistan-India matches but the Chairperson of the ICC has stated that to discourage future withdrawals, adherence to requirements is imperative.

The Pakistan Cricket Board (PCB) has made a conditional offer to use Pakistan's venues as alternative options, therefore giving them added negotiating power regarding where tournaments can be played. There is significant uncertainty for brands and this will increase the costs of hedging, thus resulting in higher coverage costs; specifically, insurance providers will view clauses associated with player safety with greater scrutiny and therefore set higher rates for such policies.

Legal Plays and Diplomatic Maneuvers

The ICC's Dispute Resolution Committee rejected BCB's appeal; therefore, the next available option for BCB is to proceed to the Court of Arbitration for Sport. Historically, ICC's rules have not permitted case hearings concerning Venue decisions by ICC. Within the 2023 Asian Cup, C.A.S. supported the ICC in regards to the Venue. On DG-backed calls for security for Nazrul's team, Nazrul stated that they are state security calls—not related to BCB. Nazrul noted that quiet diplomacy through Commonwealth countries could result in a compromise between Sri Lanka and themselves, thus, allowing both parties to keep the mutual BP links valued over $20 million.

Strategies for Businesses Amid the Drama

• Use Sponsors to diversify the market and have neutral-platform activated campaigns.
• For Broadcasters, Prepare alternate schedules, especially to promote the India-Pakistan match for rating purposes.
• For Apparel/Merchandise, Either stockpile Bangladesh merchandise or find countries you can use as replacement (Scotland/Scotlands).
• In the long term, ICC may consider imposing fines of up to $2 million, creating constraints on the Bangladesh Cricket Board's (BCB) budget of $50 million, while businesses will look for Event Risk Reinsurance for the Event Risks.

Path Forward: Resolution or Replacement?

As the deadline expires, the committee expects an announcement that may arrive this Saturday, leaving Scotland as the alternate country's option if needed. Only time will tell if Bangladesh remains adamant in their desire to be part of the event, including through the use of legal channels (DRC/CAS). However, as the starting date approaches (February 7), there cannot be much longer before making such a decision from either side.

Although Sri Lanka's will receive a significant amount of torus, which will support their economy i.e. approximately $30 per event. However, if this event is taken away it will suffer immensely. Sri Lanka’s future in cricket will be impacted if it loses such additional events, on top of those already lost in the span of the last 3 years. This has benefitted Indian and Pakistani markets to grow disproportionately.

This whole situation showcases how geopolitics exert tremendous amounts of control over the sport’s business. Stability is one thing that attracts investors and therefore countries need to be alert about the behind-the-scenes- arrangements.