A Very Eastern Conference: Can Software Tycoon Vivek Ranadive Make The NBA Popular In India?

The National Basketball Association (NBA), one of the most popular sports/entertainment vehicles in the United States, attained a global audience in the late 1980s/early 1990s, largely due to the aggressive promotion of iconic superstars like Michael Jordan, Magic Johnson and Larry Bird. Now, in 2014, with LeBron James, Kevin Durant and Kobe Bryant serving as the most prominent "faces" of the league, the NBA enjoys status as a multi-billion dollar juggernaut across much of the globe. Under the leadership of the creative and profit-driven Commissioner David Stern (who will retire soon), the NBA has an international following, including devoted, besotted hoops fans across Europe, South America and the Far East (especially China).

Forbes magazine reported that revenues for the NBA’s thirty teams aggregated to $4.6-billion last year, light years away from the $118 million the league earned in 1982-1983, the year before Stern became commissioner. The average NBA club is now valued at about $634 million, with all teams having a total worth of some $19 billion -- the New York Knickerbockers carrying the highest price tag at $1.4 billion. (In 1984, when 23 clubs existed, their collective value came to just $400 million) NBA playoff games, which were shown on tape-delay in the U.S. back in the early 1980s due to a lack of interest among the viewing public, are now broadcast live in more than 200 nations around the world. In this gilded age, the league’s broadcasting contracts with ESPN and TNT are valued at about $930 million annually until 2015-2016.

Most importantly, Stern has steered the league overseas, particularly to the huge market in China, where the NBA enjoys immense popularity. In 2008, the league launched its ‘NBA China’ venture, helped by investments from Walt Disney Co. (NYSE: DIS), the owner of ESPN, and various Chinese partners. Forbes noted that the NBA is expected to generate revenues of $200 million this year from China -- a figure that is expected to keep growing.

Now the NBA has turned its eyes toward another huge (but largely untapped) Asian market -- India and its 1.2 billion people. Two major events from the past three years have helped to accelerate the NBA’s efforts in establishing a footprint on the sub-continent: the founding of a league office in the financial capital city of Mumbai in 2011; followed in 2013 by the historic purchase of the Sacramento Kings basketball club by a group led by Vivek Ranadive, a Silicon Valley-based software/tech tycoon and founder of Tibco Software Inc. (Nasdaq: TIBX), who became the first Indian-born majority owner of an NBA franchise. Ranadive and his group of investors paid $347 million for a 65 percent share of the Kings, thereby saving the club from fleeing to Seattle. Among the rival bidders that Ranadive defeated were Steve Ballmer, the boss of Microsoft (NASDAQ: MSFT). (In quite a coup, Ranadive’s ownership even includes NBA legend Shaquille O’Neal).

Ranadive has committed to building up the Kings as a ‘global brand’ and wants to extend the team’s reach 8,000 miles away to his native India by staging pre-season exhibition games there, perhaps as soon as next year. (The NBA has already held several pre-season games in Japan, China, Taiwan, and Philippines, but never in India). “In India, there’s [more than] a billion people,” Ranadive told NBA.com. “When they have a cricket match, there’s 600 million people watching [on TV and online]. If we got a small fraction of that, that would still be a very big number.”

But Ranadive is very well aware of the challenges his dream faces: among other factors, cricket – and to a lesser extent, soccer – hold hundreds of millions of Indians in their grip and it is unlikely that basketball can possibly dislodge either one of those sports from the top of the country’s athletic passions. He told NBA.com: "Cricket will always be the national pastime in India. But if basketball can be a strong second… It's the kind of sport that can be played in a poor country like India; it can be played by one person, by a few people, by boys, by girls, in villages, in cities, [and] you don't need a lot of space for it like you do for cricket. So I fully expect it to be very, very popular. Also, Indians love numbers, and there's a lot of numbers associated with basketball! So I think in about 10 years [the sport] will be a huge [phenomenon] in India."

The Kings have already entered into a corporate sponsorship deal with Indian development company, The Krrish Group. This agreement has led to a Hindi-language website promoting the Kings, as well as various marketing campaigns across the country. "We hope that this will be the first of many important business partnerships from the region," Ranadive said.

Alok Sinha, the sports editor for the Times of India newspaper, agreed that basketball’s popularity is climbing in his country, although at the moment hoops ranks far behind cricket as the top sport. “[The] Lakers, everybody knows them in India,” Sinha told National Public Radio. “And people are talking about Kobe Bryant or people are talking about LeBron James.”

Of more urgency, there are no arenas in India yet that can match NBA standards. “We have to find the right facility,” Ranadive said. “Right now they don’t have one. But we have a year and the NBA is very, very supportive about building the brand in India.” Indeed, poor infrastructure and lack of NBA-quality arenas and adequate amenities could hurt basketball’s evolution in India. “The best basketball gymnasiums in India are functional but not spectacular,” said Karan Madhok, an Indian basketball writer. “India has hosted international [International Basketball Federation-FIBA] level tournaments in their gyms but they are not up to NBA standards.”

On his Hoopistani blog, Madhok pointed out that India was embarrassed by the poor facilities it offered during the 2010 Commonwealth Games in Delhi. Plus, there are matters of cost and affordability. “And even if a NBA-quality facility is built in India over the next 12 months, would the cost of it be justified?” he asked rhetorically. “Outside of the elites, very few average Indians would be able to afford an NBA exhibition [game], unless the costs are slashed heavily, and in which case, the investors of the entire project would be suffering a devastatingly heavy loss.”

One thing that might greatly help the popularity of the game in India would be the ascension of an Indian lad into the NBA – considering what the success of Yao Ming has done for the sport in China and what the popularity of Jeremy Lin did in his native Taiwan. Currently, there are no young men of East Indian descent on any pro basketball roster in the United States and only a few in the college ranks, including Sim Bhullar, a 7-foot-5 Indo-Canadian Sikh who plays at New Mexico State University. “I think if Sim can work hard over the next year or two, there is an outside chance that he could become the first Indian-origin player to be drafted to the NBA,” said Madhok. “There are no players in India yet with the potential to make it to the NBA, but a young 7-footer [named] Satnam Singh Bhamara made a major breakthrough when he was recruited to play for the IMG Academy in high school. Bhamara has been performing quite well at high school level, but right now, it's hard to predict if he can turn this potential into real talent.”

But Commissioner Stern, who visited India in April of last year, is optimistic that an Indian player will appear on a NBA club within five years (meaning, by 2018) "We already had a woman [Geethu Anna Jose, captain of the Indian women's national basketball team] try out for [the] WNBA and we would expect to have men and women showing up for each of our professional leagues,” Stern told Indian reporters during that visit. "If we get our grassroots programs going bigger and kids across [India] start bouncing the ball rather than kicking it or hitting it with a strange [cricket] paddle, there will be an enormous influx of very good and talented [Indian] athletes into our game.”

Stern added: "If you had asked me 20 years ago, I would have said I don't know [about foreign players entering the NBA]. Now, 85 out of our 400 [NBA] players are born outside the USA... The one thing we do is to work as close as possible with the Basketball Federation of India (BFI) through grassroots and other events to make it as easy as possible for elite Indian athletes to spend more time playing basketball.” NDTV, an Indian television broadcaster, also reported at the time that Stern also believes India could have its own professional basketball league in a “couple of years at least.”

Indeed, an Indian company called IMG Reliance, owned by business magnate Mukesh Ambani, reportedly has an agreement with BFI to develop a basketball league in India, with participation from the NBA. Under a deal between IMG and BFI, IMG will receive commercial rights, including sponsorship, advertising, broadcasting, merchandising, film, video and data, intellectual property, franchising and new league rights, NDTV said.

Todd McFall, a sports economist at Wake Forest University in North Carolina, believes Ranadive’s strategy will eventually pay off. "The NBA has invested in the Internet and can broadcast games anywhere on the planet. Ranadive and teams like the Sacramento Kings are using that technology to build a market that will make the NBA more successful than ever," he told NewsWise.com "Eventually, as young people in India learn more about basketball and get excited about playing the game, there will be a great Indian basketball player that will expand the connection with the fan base in that country — much like Yao Ming has done in China."

McFall also explianed that Indian basketball is beyond the embryonic stage. “There are youth leagues around the country, and the national team just won the tournament in the Lusofonia Games, so there's definitely a strong organizational structure in place,” he said. But he concedes that the NBA has made few inroads in India. “A few players have led excursions [to India] in hopes of developing interest in the game,” he said. “[Boston Celtic Hall of Famer] Robert Parrish has been there on few occasions, for instance.”

However, the NBA is still anxiously awaiting the first great basketball player from India, While Europe has produced many exceptional NBA players, including Arvydas Sabonis (Lithuania), Drazen Petrovic (Croatia), Toni Kukoc (Croatia), Dirk Nowitzki (Germany), and Pau Gasol (Spain); and China delivered Yao Ming -- India may be a long way from siring an NBA-quality basketball player. But McFall cautions it would be foolhardy to predict the future. “If you would have told basketball coaches in 1980 that one of the best post players in history was about to board a plane from Nigeria to the University of Houston, you would have been taken for a fool,” he said, referring to Hall of Fame center Hakeem Olajuwon. “Who knows when the great Indian player will grace his presence on the world stage? One is tempted to say that it could take some time, given the less centralized nature of Indian sport compared to say China, which made a concerted effort to find Yao Ming. But there seems to be an organizational structure in place [in India] such that a very good player will be identified and groomed.”

Meanwhile, basketball continues to thrive and penetrate deeper into China, where some 300 million people (equal to the entire population of the US) are believed to play the game regularly. Madhok, who is currently based in China, attested to the tremendous popularity of the game in the country. “The Chinese already loved basketball, but the success of Yao Ming has taken it to the next level, and you could say that basketball is now the country's most-loved sport,” he said. “China usually has the best [national] basketball teams in Asia and is usually Asia's top performer at Olympic basketball. The NBA hosts events around the year to reach out to the Chinese audience, more than any other international market. Dozens of NBA players visit China to promote themselves or the league every year, and, of late, two NBA exhibition games are played every off-season in China. The NBA and [its] biggest stars are known names in even small towns and villages in China.”

Indeed, Chinese basketball is so well developed that it now attracts washed up former NBA players like Stephon Marbury to play there (somewhat similar to how ex-Major League Baseball players finished their careers in Japan in the 1960s and 1970s). The 2008 summer Olympic Games in Beijing also played a key role in the game's popularity by bringing NBA superstars like LeBron James, Kobe Bryant, Chris Paul, and Carmelo Anthony to perform before a huge and excited Chinese television audience. “Can you imagine what that was like for a young Chinese boy interested in basketball?” McFall pondered. “We might look back on that moment as being just as important as the [1992 Olympic] Barcelona Games, in terms of growing the NBA [brand]. There were so many people who got to experience the excellence of that team in China.”

McFall added that he doubts India will witness a similar moment in the near future. “An exhibition game just doesn't have the same impact as the Olympics did, and an exhibition game is likely all that India will get,” he stated.

Despite these many challenges, McFall thinks Ranadive is the ideal person to help upgrade the popularity of the NBA in India. “He [obviously] has a strong connection to India and now he's one of the few owners of an NBA team,” he said. “There are [other NBA] owners who will gladly listen to Ranadive's ideas for growing the game in India. [Also,] Sacramento's proximity to Silicon Valley means there are a large number of highly educated [and wealthy] Indians who live near the franchise, so small changes [in] the way the team markets itself might attract fans to Kings' games. But the gamble Ranadive is [taking] is that he can use technology to attract millions of new fans all the way around the world… I think his star power alone might be enough to make the Kings interesting to many in India. The extent to which this will be successful will depend partly on how much support he can garner from fellow owners and from the NBA front offices.”

For now, the NBA is taking baby-steps in India with the Kings. However, no matter how much exposure the Kings acquire in India, they will lose interest with the public if they don’t start winning. The Kings have not had a winning season since 2005-06, which was also the last time they made the playoffs. They have also never won a NBA championship, nor even appeared in a Finals match-up. The club currently also lacks a superstar player to build an identity around, although forward-center DeMarcus Cousins may develop into an all-star. “If [Cousins] can continue to mature into a stable player to build around, or if they are able to draft or trade for another big name, they will suddenly become a global brand,” Madhok said.

In any case, a near-billionaire like Ranadive is probably the right person to expand the NBA into India.