Month: December 2011

A Little Help From My Friends – Fixing Still Rife In Cricket?

As my first article for this section, Ive got something which is slightly old. For a few years now, a friend of mine has been suggesting to me that spot fixing is still very prevalent in cricket today. As soon as the first edition of IPL was over, he was the first to tell me that there was something ‘off’ about it. 4 or 5 matches into the IPL Season 2, he wrote to me on a piece of paper and signed it saying ‘there is fixing for sure’. And all this was well before any ruckus of the Pakistani cricketers fixing or the Lalit Modi controversy ever came up. Soon before the Cricket World Cup Semi Final began, he called me to tell me India was going to beat Pakistan and will eventually win the Final. Needless to say, I was skeptical about it. But here is the article he drew up sometime after the world cup which, along with his past history regarding this kind of stuff, convinced me it might have just happened. 

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So, basically, the very basics of placing bets with Indian bookies are:

  • You call him up and the bookie gives you odds for say (Ind Vs SA) at 82p-85p India and you have about Rs 10000 to bet . Now you can

 

  1. Either bet Rs 10000 on India @ 82p (India being favorites) and win 8200 upon India win or lose 10k if India loses; or
  2. Place a bet for India not winning @85p and win 10k if India loses, or lose 8500 if India wins.

 

  • You have sessions where the bookie gives you a certain score for a certain number of overs. No odds there (basically flat bets). You can either choose a yes or a no for that score. So, if the bookie gives you a score of say 50 for a session in 10 overs. Now, you can

 

  1. Bet for 50 up and if the score goes beyond 50, win money and lose otherwise; or
  2. Bet for 50 down and if the score stays below 50, you win and otherwise lose.

 

I’ve been following the fluctuations of odds in the market for a while now. Matches across T20s usually have a lot of fluctuations considering the volatility of the game. Now, from a betting organization / bookie’s perspective, their profitability is usually dependent on the number of transactions that happen within the market. Odds available in the market usually work on a buy /sell model (just like stock market) where price (in this case odds) fluctuations are dependent upon the demand and supply at a price. In order to increase the frequency and volume of transactions, a bookie always looks forward to shift of momentum within matches for increasing the activity ratio in the market.

What usually happens is, a lot of people who bet in India, do it with a conservative / instinctive approach. Especially in matches involving India, they stake money on India despite unfavorable odds.

 

Now, what I was trying to explain yesterday was that off late, the drama within matches has increased manifold. And so has the nature of matches. I can’t recall a time where so many matches had a change of favorites so frequently within the match except for when the IPL had begun. Now, there is more unusual stuff to this, than visible. I’d like to use some examples to explain what I really mean

 

Exhibit A – Ireland vs England – At 111 for 5 chasing 330 odd, Ireland were basically written off. The odds on the match at that point were 1p-2p England. Loads of punters throw in mad money on England. And with the turn of events within the game, basically, they can’t win even if they later reversed their bets cos the odds were extremely unfavorable. Sure, Ireland played brilliant, KOB was the Guns of Navarone that night and this could be one of those inspirational pull offs by a weaker team.

Exhitbit B – Australia Vs Zimbabwe – At 17 for 0 in 3 overs, Aus were definitely headed to say 60-65 in 10 overs against an opposition like Zimbabwe. However, the session that the bookies offered here was only 42. Very strange considering the reputation of Watson and Haddin and them playing in a Powerplay. However, lots of punters gleefully accepted a 42 up thinking it would be a cake walk from there on. Scores for the session keep dropping and Aus close with a score 28-0 after 10 overs.

Rashid Latif made comments and raised concerns over this thing, but was basically ignored. Obviously, it was stupid to make such claims in public without any evidences. But, considering the history and reputation of Pakistan cricket, I am certain that those guys are sensitive about how this works.

Exhibit C – England Vs South Africa – With 172 to chase, and after the start by Amla and Smith, the odds for the match go down to 2p-3p SA in less than 8 overs of the 2nd innings. At 124-3, SA need 48 runs with tons of overs. Now, all of a sudden there, SA lose like 5 wickets and the scores are 130 odd for 8. England are now favorites at odds of 10p-12p. But, with Steyn and Van Wyk building a partnership and needing 8 to win, SA are favs again. The odds on Betfair at this point 6p-7p SA. However, the bookie offers 35p-38p. Which is basically just to prompt the punter to stake money on SA since the odds are extremely favorable on SA win. And within an over or so, 2 quick wickets fall to wrap the match for England.

Exhitbit D – England Vs Bangladesh – At 156 for 3 chasing 220 odd, Imrul Kayes and Shakib are cruising comfortably. Odds at this point are 15p-17p Bangla. An appeal of LBW against Kayes is turned down. And immediately after, they follow it up with a pretty needless run out. More wickets fall, misery continues, runs freeze. Bangla now 160 odd for 8. England are favs at 5p-7p. We all know what the result of the match was.

Exhibit E – India Vs South Africa – Nine wickets fall for 29, but no one other than Zak and Munaf having to play good balls. At 260 odd for 1, and India cruising towards 370 possibly, odds for India are 12p-14p at this point of time. Sessions though are still offering only 343. Again unusually strange amount of difference. Punters happily go for a 343 yes. And we all know where their money went.

So, I decided to make some predictions just based on what I’d been thinking all these days. Even before SA innings had begun, I predicted the match going to the last over with a lot of turns through the match. India favorites until like 20 overs. Then SA become favorites and Amla and Kallis continue to milk and proceed without much trouble. Now, Amla plays a shot to Yuvraj at short mid-wicket for a fairly straight forward catch. Yuvraj drops it. Amla gets out next over anyways. Few overs later, Zak calls for a huge appeal against Kallis, not given. Kallis does an Imrul Kayes and runs himself out in a ridiculous manner. India back favorites. Now, at this point of time as a man in form and a key batsman, AB is expected to carry them through the innings. No doubt he scored a 50, but just look up his innings if you already haven’t. Crazy slogs, reverse sweeping and the most unorthodox and risky shots. Strange for a guy like AB who’s in pretty good nick and who relies more on his orthodox style. The required rate is just close to 7. Especially the shot where he reverse swept one towards fine leg was extremely alarming. The game progressed and SA needed abt 78 off 10 overs with 7 wickets in hand. SA were favorites again and just as expected and similar to the pattern above, 3 wickets fall, India are favorites again and punters are giving it everything cos its India. And towards the end drama continues.

 

The point that I’ve been trying to stress upon is that the eventual result of the match does not matter, but what does matter is the course of the match. And that’s where all the money comes in. The T20 world cup in 2010 had sums worth Rs 125000 crores staked even before the tournament had begun. And the pattern for almost every match has now started involving a lot of money.

 

Another reason why I conceive this is for the state of ODI cricket today. Revenue in ODIs is dropping, people are losing interest and its all heading towards T20s. The ICC looks at this tournament as one way of reviving the format. Throw in a lot of close matches, it gives em more drama, more viewership, more money and ODIs are saved.

 

In general, I don’t remember times when there used to be so many umpiring controversies, so many dropped catches and other things. Whenever I speak to people about this, they basically rule this as rubbish and ask me the basis. Its only unofficial and theoretical, but it makes perfect sense to me. Usually, people just give away with things such as “There is no way on earth a guy like Sachin would involve in fixing”. I am not trying to point fingers at individuals, but this is a system that operates, irrespective of how hard we believe that its clean. And it’s a large network. It does not depend on individuals.

 

My bookie had guaranteed me that Lalit Modi would be behind bars even before the whole Modi-Tharoor saga had begun. It is so obvious that he was just a scape goat and was used as the face of the whole scam to keep the real names behind the veil. And as usual, the case has now been forgotten; the accounts have got a clean chit, Modi will continue to fight his case for years and other things will operate the way they were. A number of bookies shut their operations during the whole scene, a few went behind bars and eventually things cooled down.

 

The fact that betting is not legalized in India, makes it very difficult to regulate this industry. Everyone is aware that the racket is huge and people throw in a lot of money. But since this is not regulated, there is no monitoring of transactions, no methodology prescribed by authorities for giving out odds and hence, no control what so ever.

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“Haaai FDI. Lol, Just Kidding”

As Im sure most of you are aware, the Government of India took a bold decision to allow 51% FDI in the retail sector, last month. Less than half a month later, this decision was withdrawn after furor from Opposition and some allies, as well. This has been one of the most comical and appalling things we’ve seen happen in recent times(remember there have been far too many incidents like this, so it must be quite ridiculous to be top of the pile).  Here I am mulling over what could possibly be the reason and Ive managed to deduce what follows. But before going there, we need to have a little perspective on the situation.

 

The retail market is one of the most competitive sectors in the India economy. It varies from the established super-markets or mega-stores like Spencers Daily, Nilgris, Reliance, Big Bazar, Landmark to people who sell at farms, in the local markets and people who cycle to your house with vegetables every morning. As almost all highly competitive sectors, you can understand that this is going to mean low margins. People must understand that in retail costs extend beyond normal operating costs and go on to constants discounts, price cuts, offers etc. to help gain market share(which mostly ends up being temporary). Needless to say, the recent economic slowdown has hit retailers. Lower volumes, lower margins, increasing costs due to infaltion and sky-rocketing rentals have left most Retail Giants stumped on how to better the situation. The obvious answer is FDI in this sector will help increase the margins, volumes and growth. Not stopping there, it improves quality, confidence and likely more discounts and better offers for consumers. Would Foreign Retailers be interested? Hell yeah!

 

One report estimates the 2011 Indian retail market as generating sales of about $470 billion a year. The Economist forecasts that Indian retail will nearly double in economic value, expanding by about $400 billion by 2020. This projected increase alone is equivalent to the current retail market size of France. The Indian consumer market is the biggest in the world and will continue to grow at a very high rate. Foreign Retail Giants like Tesco and Walmart have been monitoring the Indian Retail Scene for a few years now. They’d been in constant discussion with some established Indian retailers regarding their possible entry or tie-ups to enter into India.

 

Now the Government has decided to pull back on the plan of allowing 51% FDI in Retail. This happened in less than a month. The reason is objections from the opposition, allies, logjams and a Nation-wide Bandh. This sudden shift in government stance could wreck the plans of India’s top retailers like Future Group, Bharti Retail, Spencer’s Retail and Next, all of which were banking on foreign capital for their expansion and expertise to run a complex business like retail.

 

The Indian Economy desperately need to kick-start its growth and a new lease of life in Retail through the means of FDI would have delivered just that. The most alarming part is not the fact that it was withdrawn, but the fact that the Government was bold enough to put into place first and then be threatened so easily to withdraw it. FDI could have easily helped boost India’s foreign reserves as well, which is in a sad sad state of affairs. However, that is a matter which will be discussed separately, through another piece on the blog.

 

As consumers, why should be we be denied better quality products, more affordable prices, recognised brand-names, more job employment opportunities in favour of buying from local sellers, through various middle-men, at inflated prices? Is a small-scale retail base of people in Lakhs more important than a consumer base of several crores? The Govt. simply shouldnt do that. They should succumb to this squabbles over vote-bank politics, where most of the parties are playing to gallery. A lot of people opposing this deal have vested interests. I fail to see how they will put up a formidable argument to having FDI.

Consumer : “Hey, I want FDI. It’ll be useful for us all.”

Opposition : “No. Think about the farmers and small scale sellers.”

Consumer : “But there are far more consumers than sellers. We have get better quality and much better offers and prices. Its a lot more affordable and dependable.”

Opposition : “No. Think about the farmers and small scale sellers.”

Consumer : “But companies like Walmart and Tesco normally buy or use upto 40% of their products from SMEs. They will be protected upto a significant level.”

Opposition : “Uhhh… well….. Foreign companies have poopy pants!”

 

Ok, maybe the debate wouldnt end like that but you get the point. Vested interests and vote-bank politics are affecting a deal that will significantly help both consumers and the Indian Economy. The Govt. should mash out a deal that will the best share of the pie to the most no.of people who consume it, Ala, the consumers.