Ken Borland

SA Rugby CEO Jurie Roux said recently that every union whether provincial or international is going to join up with private equity partners either sooner or later. Rugby has been one of the slowest sports to embrace professionalism though and I can hear many fans wailing that private equity is going to ruin the game.

“Private equity in rugby will have a massive influence, it will probably control rugby. And yes, SA Rugby is in discussions with private firms, but I don’t think there’s a union that’s not talking to someone. We all live in a post-Covid world that is now a much smaller pond and there is the opportunity now for investors to buy things at much cheaper prices. Private equity is here to stay, you’ll either join early or late, but join you will,” Roux said in an online press conference earlier this month.

There is perhaps going to be understandable anxiety that rugby is going to end up in the same sort of mess as the Premier Soccer League has with the controversial sale of the famous BidVest Wits club to a little-known National First Division club, Tshakhuma Tsha Madzivhandila, based in Limpopo. Thanks to BidVest cynically pulling the plug based purely on financial considerations, 99 years of history is down the drain, a club that has won nine top-flight trophies and produced players such as Gary Bailey, Peter Gordon, Richard Gough, Sam Magalefa, Thulani Hlatshwayo and Benson Mhlongo for all intents and purposes no longer exists.

Never mind Western Province leaving Newlands, can you imagine the outrage if it was announced that the Bulls were moving to Polokwane and would henceforth be known as the Buffaloes?

But let me allay your fears by pointing out that rugby has mechanisms in place to prevent such stupid things from happening.

Before going to market, a union will split its assets between a commercial/professional arm, which will largely deal with corporate matters like sponsorships, advertising, marketing and broadcast deals, and an amateur arm which will hold assets like the stadium (whether they own it or have a rental deal) and ‘intellectual property’ like the team name.

Stakeholders can then buy shares in the commercial/professional arm. A private company can buy 25% of those shares and the union gets the cash, while the equity partner takes dividends while also hopefully driving up the commercial value of those properties.

Even though SA Rugby’s constitution now allows for private companies to own up to 74% of a union’s professional arm, as long as the ‘amateur’ administrators have done their paperwork correctly then properties like the team name or where they play should be totally protected even if the union is now a minority shareholder.

The Bulls have been amongst the first unions to really make private equity work for them, with Patrice Motsepe’s African Rainbow Capital Investments and Johann Rupert’s Remgro each owning 37% of the Blue Bulls Company. First prize to them because the influx of cash has allowed the Bulls to hire big-name coaches in John Mitchell and now Jake White, who is totally revamping the team with a host of quality additions to the player roster.

Perhaps the first thing for a union to ensure is that there is synergy between themselves and their private equity partners, so that they can work together to run a successful team.

Unfortunately there have been two unions in the news lately for getting it all wrong – the Eastern Province Rugby Football Union and the Western Province Rugby Football Union. Both those beleaguered unions seem to be suffering from a bunch of rank amateurs trying to run multimillion rand businesses.

After years of wrangling seemed to be coming to an end with the signing of heads of agreement to sell Newlands to Investec, WPRFU president Zelt Marais has unilaterally decided not to sign off on the rest of the deal, despite already taking an advance of more than R50 million from Investec. Interestingly, the WPRFU also owe Remgro R58 million for a loan. These are powerful enemies to have and one fears that the once proud union could be heading the same way as Eastern Province.

The embattled Port Elizabeth franchise just seems to lurch from one crisis to the next and fresh problems are now springing up between the company that holds the majority shareholding in the Southern Kings and the EPRFU.

Roux was not specifically talking about the Southern Kings or Western Province, but his message certainly applies to them when he said political interference tends to surface when administrators try to run their franchises as an amateur entity.

But to borrow from Saturday Citizen deputy editor Brendan Seery’s excellent Column, for every couple of Onions that have to be dished out to unions, there will be more Orchids given out to those who make private equity work.

Simply put, rugby is unable to survive this post-Covid world without them so, like the Wallabies and scrums, every union just has to find a way of making these partnerships work.

As we have seen so often in rugby, making changes to long-standing rules of the game almost invariably brings unexpected consequences and there has been a lot of talk recently about doing away with one of cricket’s most famous traditions, a move which I believe will boomerang badly on the sport.

South African captain Faf du Plessis was the latest to bring up doing away with the toss, although his beliefs lost some credibility because they came straight after the Proteas had been mauled in their two Tests in Sri Lanka.

Various high-profile Australians have also backed the ending of the toss, but again, these comments were mostly made after they had lost the Ashes in England.

Proponents of the eradication of the toss propose that the visiting team just gets to choose whether they want to bat or bowl, thereby supposedly removing home advantage, which the anti-toss advocates say has become a major problem in world cricket.

Happily, a couple of months ago the ICC Cricket Committee discussed doing away with the toss and decided that it was an integral part of the game and should be spared.

No doubt they had a better grasp of the actual facts surrounding the issue. Home ground advantage has always played a role in cricket, as it does in just about every sport, but winning or losing the toss actually does not have a major effect.

In this decade, the team winning the toss still only wins 43.78% of Test matches, so it is not a massive advantage. There is a slight benefit because only 35.13% of teams that lose the toss go on to win the match. Historically, Australia are the only side that wins more than 50% of the Tests in which they have won the toss, and even then it’s just 50.49%, only slightly higher than their overall success rate of 47.16%.

I believe giving the visiting team total control over what they do first would have a major bearing on the game, which is where the unintended consequences come in, especially in countries like India or New Zealand.

It’s fair to say the weather is out of the control of the people who prepare the pitches in those countries and they can only do so much to negate the effect of overhead conditions. Doing away with the toss would grossly undermine teams like India and New Zealand – in the heat of the sub-continent, dry, dusty, deteriorating pitches are almost inevitable and India would be batting second every time; conversely, New Zealand is usually pretty damp and overcast and the Black Caps would find themselves sent in to bat every time.

It would happen often in England as well that the home team would automatically have to bat at the most difficult time and it could also affect the Proteas at home.

What it boils down to is the ICC actually using the mechanisms they already have in place to ensure fair conditions – they already have rules in the playing conditions when it comes to unfair pitches and they just need to enforce them more diligently, especially when it comes to the sub-continent and even some South African green mambas.

The perception that away teams are struggling does have some basis in fact. In this decade, the visiting team has lost 51.75% of Tests, up from 46.40% in the 2000s. It is interesting, though, that the away team has been winning Tests in the last 20 years at pretty much the same rate as they have been doing through the history of the game.

It is, of course, the number of away draws that has dropped significantly in recent times; down from 47.31% of Tests in the 1960s to just 20.76% in this decade. That is obviously a positive but it also points to the rise of T20 cricket and batsmen being able to hit the ball but not defend against the turning, seaming or swinging delivery.

The problem is not the toss, it’s modern-day batsmen being ill-prepared for foreign conditions, and sometimes the ICC allows the home union to get away with cheap shots in terms of pitch preparation.

Nielsen Sports, the provider of analytics for the sports industry, recently gave their annual presentation on the biggest trends in sports business and the two major talking points over the last year are the rise of e-Sports and the fact that sports bodies and their sponsors have to know who their fans are in this rapidly evolving marketplace.

Their research shows that, on average, only 10-15% of any sport’s fans are actually ‘game experts’ – people who have intimate knowledge of the rules, history, players, tactics etc. So any sports body or sponsor that only targets this section of the fan base are clearly missing out, for instance, on the 30-35% of ‘connection fans’ – for them it’s about the big event and they are the people packing out the stadia for Pink Day, the Cape Town Sevens rugby or the Durban July.

In the past, the relationship between a sport and a brand was based on the sponsor wanting visibility and the sport just wanting money. But this relationship is now much broader and the rights a sports body sells need to be more flexible and more tailored to their specific partners. Sponsors these days want to own stories and content rules in this digital age in which internet advertising spend overtook that for TV worldwide last year.

It was disappointing to hear that our traditional sports like rugby and cricket are battling to grow in this environment. In South Africa, 25% fewer millennials are interested in rugby, and cricket has seen the same drop in support.

The fastest growing sport in the world is e-Sports, which is basically what professional, competitive gaming is called, and unfortunately, rugby and cricket just don’t have games on the market that are good enough. Research has shown that there is a strong crossover between people who play the virtual game on their computers and supporting the actual ‘live’ sport. For instance, Fifa’s eWorldCup drew seven million gamers last year and Formula One enjoyed similar success with their eSports Final, the winner of which gained a one-year contract as a simulator driver for McLaren.

That e-Sports is rapidly evolving into a major player in the sports industry is shown by the fact that one-third of all their fans came onboard in the last year and they are typically millennial men with money to spend. Which means major global brands like Gillette, C-Smart and Mercedes are moving into that space, the higher LSM also attracting sponsors like Audi and Mountain Dew. Gaming is a $32 billion industry now and at the competitive level it is a mega-production, a whole show with adverts, sponsored decks and kids packed into stadia.

This year’s Overwatch League features 12 franchises based in cities like Boston, London and Shanghai who paid $20 million each to participate. The broadcast rights were sold for $90 million and the average audience is 280 000 per minute.

Speaking of broadcast rights, this field has also become extraordinarily broad for sponsors and sports bodies. Pay TV’s influence is still stable, but there are disruptors now in the picture, especially tech giants like Amazon and Facebook and even Twitter.

The cellphone has become a way of life and we are living in a mobile-first generation. Although high data costs hold us back in South Africa, 20% of local football viewers watch via internet streams, with 69% of those people watching the game live and 42% of those watching the whole game.

Rugby has 25% of its viewers streaming the game, 68% of that watching live and 48% for the whole game; cricket’s figures are 22% streaming, 78% of that live and 40% watching the full game.

The sports industry is certainly a very fluid environment for rights-holders and sponsors to get their heads around.

https://www.pressreader.com/south-africa/the-citizen-kzn/20180623/282484299488829

There has been a lot of talk recently around Gauteng cricket of revolutionising the game, but so far their only notable action has been to strip the most successful Black African coach in franchise cricket of his duties, making him the fall guy for a poor season by the Highveld Lions.

Geoff Toyana was the first Black African head coach of a franchise when he was appointed in 2012 and he steered the Lions to four trophies in the next four seasons. There have been lean pickings since then, but there have certainly been extenuating circumstances – Toyana has had to practically rebuild a whole team due to the matchfixing scandal and the retirement of several senior players.

Sure, Toyana will still be employed by the Gauteng Cricket Board as High Performance Coach, but there is little doubt that this is a demotion and a slap in the face for someone who has been at the forefront of transformation at franchise level.

The last season was particularly disappointing for the Lions – they finished last in the Sunfoil Series and fifth in both the Momentum One-Day Cup and RamSlam T20 Challenge – but when board members come into the changeroom mid-season and lambast the players with threats that eight of them will lose their contracts, it’s hardly conducive to inspirational performances.

Toyana will be the first to admit that he was probably not at his best as coach either, but again, a more sensitive administration would have understood the reasons why. It could not have been easy for the Soweto Cricket Club product to start the summer as the favourite to be the new Proteas coach and then watch it all unravel.

Add to that massive disappointment the family bereavements he also had to deal with, and it was clear Toyana was a man under severe pressure this last summer.

But the 44-year-old still had an additional year to run on his contract and surely the right thing to do, especially if one is serious about transformation and not just political powerplays, would have been to wipe the slate clean on the last season and allow Toyana to finish his term. Based on results, a less knee-jerk decision could then be taken.

Especially since this is a man who has added so much to the reputation of Gauteng cricket. Let’s not forget that before he became Highveld Lions coach, the franchise had won just one paltry trophy in eight seasons. Under Toyana’s watch, six new Test cricketers, ranging from Quinton de Kock to Stephen Cook, as well as six other limited-overs internationals were produced for the Proteas.

The talk in the Wanderers corridors is that Enoch Nkwe is in line to replace Toyana, which would make sense (at the right time) because the 35-year-old is intimately linked with Gauteng cricket. Currently the assistant coach of the national women’s side, and having fulfilled a similar role for the men’s team in the Netherlands, Nkwe played for the franchise for seven seasons before coaching the semi-pro provincial side.

But there is also talk that the Gauteng Cricket Board have got themselves into a tangle that has led to them axing Toyana. So confident were they that Toyana would be in the Proteas coaching set-up that they allegedly bought Nkwe out of his contract with Haarlemsche Cricket Club and the union now cannot afford to be paying the salaries of two head coaches at the same time.

Perhaps if the board were not so busy with putting out the regular fires that spring up from all the infighting and politicking – if it were all about the transformation needs of the game that would be fine, but the impression is that most of it is all about the personal benefit of the egos involved – then they would be more able to keep their eye on the ball and ensure the franchise is excelling where it really matters – out on the field.

https://www.pressreader.com/south-africa/the-citizen-gauteng/20180414/282595968496043