SBJ Morning Buzzcast
SBJ Morning Buzzcast: July 12, 2024
(upbeat music) Enjoy your soccer weekend. Argentina takes on Colombia and the Copa America final Sunday, 8 p.m. Fox Sports, and Spain and England meet in the UEFA European Championship final Sunday as well, 3 p.m. Also, on Fox Sports. And this is your morning buzz guys for Friday, July 12th. Good morning, I'm Abe Madcourt, NFL Commissioner Roger Goodell sat down with CNBC at Allen & Company's Sun Valley Conference on Thursday. And here were some of the takeaways. First, he did not dismiss the possibility of a renegotiation of its media deal with CBS after the company will be purchased by David Ellison and Skydance Media, which would trigger a clause for a possible reopening of the NFL's rights deal. Goodell admitted the league is paying very close attention to the process, said they'll look at the structure of the deal and make a decision on how it could impact the NFL. Here's why the league will look closely at this deal. Its current deal with CBS for the Sunday package is worth $2.1 billion per year, including playoffs and Thanksgiving. It's a pretty good deal. But, but, but, that is less than what ESPN and NBC will pay for the NBA in their new deal beginning in the 2025-26 season. And it's only slightly more than Amazon will pay for what is regarded as the NBA's C package. So there will be a real sense among NFL officials and especially NFL owners that that CBS package is very undervalued. So look for the NFL to work with the new owners of CBS to get something, something more out of their relationship. Secondly, Goodell acknowledged a tremendous amount of interest from private equity firms who were looking to invest in the NFL's teams and said the league feels it could make sense for limited investment, likely no more than 10% of a team. The 10% would be a starting point, Goodell said, and the league could be open to raising it over time. But 10% would be less than the NBA and NHL and MLB who all allow private equity ownership of up to 30%. When asked why only 10% and not the 30% of other leagues, Goodell deadpanned, we're not the other leagues, we're the NFL. Historically, the NFL has wanted its limited partners in teams to be individuals or families, hence the league's resistance to allowing private equity to invest much more than 10%. Regardless, Goodell said he hopes the league will have new ownership policies in place by the end of the year. And we know many teams are eager to take on some private equity investment and get some liquidity in those deals. So some interesting takeaways from Roger Goodell from Sun Valley. Let's stay with the NFL because add the chargers to the list of teams investing in a new training facility. This is definitely a trend we've seen across sports. The chargers open their new team headquarters in El Segundo, California, giving them a permanent base for the first time since relocating from San Diego in 2017. This is big for this franchise. The facility is called the Bolt. That makes sense. It's a 150,000 square foot facility. It includes three full size practice fields, three stories of interior spaces. It will be the day to day home for the players and about 80% of the roughly 200 person non-player chargers staff. The chargers also wanna rent it out as an event venue and they're also talking about it being a film location for Hollywood studios. Gensler Sports designed the facility and the team is looking to sell naming rights to the facility as well. The team's sponsors are fully on board. Verizon is handling connectivity at the venue. Samsung has more than 250 LED displays across the venue. Here's a cool part. Wolfgang Pock catering will run the kitchen and the cafeteria. So not a bad spot for the chargers to call home. And once again, this is a big statement for the chargers to have a home base, a home facility in Los Angeles for the first time since the team relocated from San Diego. You know, there's always political grandstanding across sports. I think it's so interesting when politicians try to immerse themselves in the sports business. Well, it reached some new heights in Pennsylvania where Pennsylvania Republican legislators are calling on the pirates to spend more to improve the team so that taxpayers who help fund PNC Park get a better return on their investment. Now, this is something I've rarely seen. The state leaders issued a study which reported that if the pirates won just three more games each year, it would increase overall fan spending by $76 million per year. Now, the representatives who asked for the study said, they're frustrated by the team's performance and they believe the team's low payroll generates low attendance and therefore less economic activity. The pirates, of course, called the report flawed and dismissed it. The report was issued as the pirates are getting closer to the end of their current lease at PNC Park, which ends in 2030. And the Republican leaders hope this data will push the state to negotiate a tougher lease that could possibly reward the team for fielding a more competitive team on the field while imposing penalties such as higher rent payments if they continue to underperform. But these types of lease agreements never work. They're very rare. Performance-based metrics aren't really in the mix. The pirates would surely ask then for much lower rent if the team won more games. But the pirates are in the mix for a wild card in the NL and this comes with the second lowest payroll in baseball. So there are eyes on Bob Nutting, who owns the team, and Ben Charington, general manager, to see if they'll add players and payroll before the trade deadline at the end of July. And it should be noted that attendance at PNC Park is on the rise. It's up over 500,000 from 2022. It's up over 100,000 from this time last year. And I'm sure some of this is due to the fact that they have one of the hottest and most interesting pitchers in baseball, the rookie Paul Skeins, who is definitely the talk of baseball. So some interesting stories out of Pittsburgh. And finally, we talk all the time about massive team valuations in sports and this frothy marketplace. Well, here is one more example on the league level. The mixed martial arts professional fighters league is now valued at about a billion dollars. Yes, I said that right, a billion dollars. Founder Don Davis and his partners have worked incredibly hard to grow this league. And this $1 billion valuation is double from the 500 million figure that was reported just two years ago as the value of the PFL. So the PFL has expanded over the past few years and their biggest expansion now is Africa. They will hold their first competition in Africa next year. Nigeria will be a key focus, but they'll also stage four events in two regions of the continent in 2025. It's interesting the strategy in Africa because we've seen what the NBA is doing with its African league and there is great promise and great opportunity on that continent. But for the PFL, which is certainly not the size of the UFC, but the PFL has been aggressive and they've done a lot in the Middle East and they are targeting leagues in Australia, Latin America, Japan and India. So the bottom line is there is certainly global appeal for combat sports. And that's driving the PFL's increasing valuation because we've already seen what Dana White and the UFC have done to grow mixed martial arts globally with the UFC. Now the PFL is using a global framework as its playbook for growth. And so that is your morning buzz cast for Friday, July 12th, I made Mancor. Thanks for listening to the buzz cast. Stay healthy, be good to each other. I'll speak to you on Monday. (upbeat music) (upbeat music)