BCCI vs. NIMBUS
Saturday, 17th November, 2007
Delay in the payment by NIMBUS which approximately is RS.130 crore to BCCI turned the latter upset. This amount was due for the recent India- Australia series. In all, $612 million or Rs 2,700 crore is how much Nimbus paid for the right to telecast Indian cricket till 2009. But with their sports channel NEO sports not managing its distribution well, there is constant speculation that Nimbus could be defaulting on its payments to the BCCI. A crisis was averted recently with Nimbus just about managing to pay their dues, failing which the board would have invoked the bank guarantee.

However, both parties insist that it was never a crisis and that Nimbus has now paid the dues. On their part, industry watchers insist that the BCCI-Nimbus relationship is likely to be strained in the days to come. This is simply because Nimbus is not managing to earn as much money as they are spending on cricket.
Nimbus currently only reaches 35 to 45 per cent of cable and satellite issues. Earlier this year their distribution deal with Star TV fell through leaving them to go it alone. The poor connectivity means that Doordarshan, who have rights to show all cricket in India because of government legislation, is the preferred channel for most people.

Advertisers obviously aren’t happy and are said to be unwilling to pay NEO’s rate of Rs 4 lakh per 20 seconds for the upcoming India-Pakistan series. Contrast that to the Rs 10 lakh per 10 seconds that ESPN managed for the T20 final between India and Pakistan.
However, Nimbus would counter that by saying that the T20 final was exclusively on ESPN since the tournament was only brought under the government’s must share clause after the world cup.
But Nimbus has also been given a rebate because this government ruling came after their contract was signed. The BCCI has given them a discount of about Rs 250 crore, which means a reduction of 10 per cent. Recovering Rs 2,700 crore from approx 23 Tests and 55 ODIs matches over four years was always going to be a tough task for anybody.
However, Nimbus seem to be struggling in particular - poor distribution, poor programming and the must share clause with Doordarshan makes this seem like a losing venture. No wonder then that everybody is looking out for the day when there is a default in payments.
The granting of telecast production rights for the high-voltage India-Pakistan series to Trans World International by the Board of Control for Cricket in India has led to an official protest by Nimbus Sport.
Claiming that their bid of USD 1.29 million was the lowest received by the BCCI and accusing an unnamed Board member of misleading its Working Committee, Nimbus Sport chairman Harish Thawani shot off a letter on Tuesday to BCCI president Ranbir Singh Mahendra and N Srinivasan, BCCI’s Finance Committee chairman, seeking redressal.
In the letter, a copy of which is with Press Trust of India, Thawani wrote: "We refer to the offers contained in our letter of February 28, 2005, faxed to BCCI office-bearers and copies delivered by hand this morning to the Working Committee. "We understand that our offer of USD 1.29 million for television production is the lowest received by the BCCI.
"We learn that one member of the BCCI sought to create the impression that our offer is USD 1.50. We do not know how such an impression came about as our letter of 28 February 2005 is very clear that our offer is USD 1.29 million," Thawani wrote.
Stating that they contract all their international cricket production through their Singapore-based Group Company World Sport Nimbus Private Limited, Thawani wrote that given their lowest offer, the BCCI "will award the production contract to us". The BCCI Working Committee had decided unanimously to award the TV production rights to TWI for USD 1.50 million.
"We sincerely hope that BCCI will respect well established principles of awarding contracts as followed by bodies serving a public function and invite us to enter into a contract for television production," the letter said. Referring to their offer for various other rights including international media rights, the Nimbus chairman said their offers were either the highest in each category or the only ones in some others.
"Please also refer to our offers for various rights such as international media rights etc. all contained in our letter of 28 February 2005. We have good reason to believe our offers are either the highest in each category or the only offer in some categories. "You will doubtless appreciate that given the paucity of time, it is imperative that we meet at the earliest to finalise contracts," the letter concluded.












































