SBJ Unpacks: Coronavirus -- Teams, Networks Capitalizing With NFL Draft

With the start of earnings season, we’re beginning to get the first numbers that show how much coronavirus is affecting business. AT&T went this morning and said the pandemic had a $435 million impact on its earnings.

In an internal memo, Fox announced a plan to cut salaries of execs who report to Lachlan Murdoch by 50%. According to the memo, from May 1 to July 31, Fox execs -- VPs and above -- will have their salaries cut 15%. Meanwhile, one-third of Endeavor employees will face layoffs, pay cuts or furloughs, according to a report in Variety.

In a bit of good news, the NCAA’s chief medical officer, Dr. Brian Hainline, said he was “cautiously optimistic” that there would be fall sports on campus. My takeaway from that remark: full recovery could take awhile. But a recovery is coming. That includes plans announced tonight by Turner Sports for a charity two-on-two golf event next month featuring Tiger Woods, Phil Mickelson, Peyton Manning and Tom Brady, with all donations and fundraising to benefit COVID-19 relief.

Stay safe, everyone.

-- John Ourand

NFL TEAMS GET FLEXIBILITY ON DIGITAL CONTENT DURING DRAFT

• Teams will have more freedom to stream their own live content during the NFL Draft than in past years, a recognition by league officials that teams can’t rely on in-person events to deliver value to their sponsors and fans during the pandemic, SBJ’s Ben Fischer reports. Teams will now be permitted to live-stream for 30 minutes during the broadcast window on Thursday night, and for 60 minutes on Friday and Saturday, sources said. That’s up from 15 minutes daily in prior years.
  
  
• Usually, team-led “draft parties” are in-person events -- usually at their stadium, a partner bar or at the draft itself -- where the focal point is the national broadcast. But this year, those parties have all shifted online, where there is much more natural tension between the teams’ need for original content and the league’s interest in driving viewership for NFL Network, ESPN and ABC. Outside of the broadcast windows, there are no restrictions on team live-streaming.
  
  
• One team source described the new draft rules as “nice to have,” but not significant drivers of new value. It’s more about reinforcing relationships with existing sponsors and enhancing the fan experience. More generally during the pandemic, sources said, the league has given teams more flexibility with owned media, allowing them to rebroadcast old games locally, easing some other restrictions on social, and connecting teams with vendors. One example on the draft specifically: The NFL is helping connect teams with colleges to collaborate on content about prospects and draft picks.

NFL DRAFT GIVES AD SALES WIN TO NETWORK PARTNERS

• The TV ad sales market has cratered during the pandemic, but ABC and ESPN have found success with this week's NFL Draft, reports SBJ's John Ourand. The ad sales group at Disney said more than 100 brands have signed up to advertise during the three-day telecast, including 60 brands that have never advertised before during the event.
  
  
• Disney is reporting a double-digit, year-over-year increase in revenue compared to last year’s draft. The most active sectors are computers, insurance, gardening and media. One new category: home workshop. Lowe’s signed up to be presenting sponsor of the ESPN and NFL Network telecasts (a simulcast airs on those networks). ABC will produce a unique production. Verizon is sponsor of "Prospect Cam"; Pizza Hut is sponsor of "Draft Moment"; and Bud Light Seltzer is sponsor of the "Virtual Huddle."

NASCAR'S STEVE PHELPS PULLS BACK THE CURTAIN

• NASCAR President Steve Phelps said the results from iRacing events during the shutdown have been “staggeringly positive.” Phelps, speaking today during the CAA World Congress Comes To You  -- an SBJ virtual event -- said the shutdown is “an opportunity for us to put something in front of our fans that’s fun. … People are yearning for live sports.” Phelps: “The other unique piece (is) we’ve had over 1 million viewers that did not watch one of our first four races and they tend to also be younger.”
  
  
• When it comes to getting cars back out on a real track, Phelps said the races will be returning “almost certainly initially without fans.” He noted NASCAR also is “working with the different states and the counties, municipalities, where we race to try to get back to racing as quickly as we can.” He said of reworking the schedule with Fox and NBC, “We went early and often to our broadcast partners to secure the windows that were necessary. We were probably the first league there with, ‘Hey, this is our schedule. Will you clear our windows?’ And the answer is, ‘Absolutely, we’ll keep clear your windows because you know, you’re essentially the first people here.” 
  
  
• Phelps in a message of encouragement to the sports industry advised other leagues to “come together.” Phelps wondered, “Is there an opportunity for us from a governmental standpoint to be able to lobby and glean what the PGA Tour is doing?” Phelps said he had a conversation with Commissioner Jay Monahan last week about his method to the madness and requested “weekly discussions about what you’re doing and what we’re doing that we may be able to draft off each other.” 

• Phelps said NASCAR as an industry has a “powerful voice,” especially when one considers “ownership and the relationships with the broadcast partners, media and sponsors.” Phelps: “It’s just a massive industry that needs to speak. Maybe we can’t speak with one voice, but we can speak smartly about how we get back to playing our games or in our case racing.” 

USOPC’s HIRSHLAND: “DON’T BE AFRAID TO PLAY OFFENSE”

• USOPC CEO Sarah Hirshland is stressing her organization's ability to be “nimble and adaptable” following the postponement of the Tokyo Games. As to whether there is any silver lining coming from the delay, Hirshland told attendees at today's CAA World Congress Comes to You virtual event that it “really forces you to focus on what matters most.” Hirshland: “I start every day making sure that I give myself time to re-prioritize what matters most, knowing what I know now, knowing what I know today, what matters most. … Right now, that is in the health and safety of our community and what does that mean and what does that look like and how do we ensure we are starting to prepare the reentry plan.” 

• Hirshland expressed confidence in the Team USA's ability to recover from effects of the pandemic. That starts with being proactive as the situation continues to develop. “It's the hardest to do, but it's critically important to not be afraid to play offense and to be thinking not just about reacting to what's coming our way, but being proactive about how we can help others. … The world changes on a daily basis, and so we're adapting and changing with it.”
  
  
• Transparency with stakeholders is also at the forefront of Hirshland’s day-to-day schedule from home in Colorado Springs. “We're doing much more frequent scheduled calls. We have calls with the NGB community more than once a week. We have calls with the athletes advisory council once a week. We have calls with our donors and our board on a regular basis. We have a financial stability group that we're working with, so it is a lot of communication and listening.”
  
  
• How’s Hirshland personally dealing with working from home? While she admitted she is constantly covered in dog hair, she is “trying to get in plenty of exercise” that she doesn’t always get the luxury of when on the road. “Certainly eating healthier. … We're trying to take care of ourselves as much as everybody else.”

NFLPA CHIEF EMPHASIZES HEALTH BEFORE ANY FOOTBALL RETURNS

• NFLPA Executive Director DeMaurice Smith said today that basic safety questions about coronavirus must be answered before you can talk details of how the NFL season might be conducted, SBJ’s Ben Fischer reports. In a pre-draft media call, Smith noted that health experts want to see declining infection rates, declining deaths and widespread testing before any general return to normalcy. His comments come one week after Dr. Anthony Fauci legitimized the prospect of games occurring with players quarantined or no fans.
  
  
• "There’s going to be a myriad of factors you have to evaluate, and facts you have to know, even before you could contemplate something like a sequester or a quarantined group,” Smith said. He said the union will discuss testing for players with the league -- but also ensuring there are enough testing kits that the NFL wouldn’t be taking from other groups that need them more urgently. “We all want to be in a position to make sure we’re not doing anything for the sake of football that would unnecessarily endanger our greater community."
  
  
• As an aside, Smith mentioned he recently read “The Great Influenza” by author John Barry, which gives a detailed look at the 1918-19 flu pandemic. One takeaway: “There was a lull in the outbreak and someone people thought it meant that it had somehow miraculously disappeared, they only later found out that the virus mutated, that it came back in much stronger form.”
  
  
• Despite all that, Smith said he saw no reason for the NFL to not publish a 2020 schedule as planned next month, as long as everyone is clear-eyed about what a return will require. In the meantime, the union’s task force will leave no stone unturned, said NFLPA Medical Director Dr. Thom Mayer. “We’re going to look at everything, every single solution that could occur, as long as it keeps the patient-players, all 2,500 of them, and the rest of their families safe,” Mayer said.

OMAR RAJA EMPHASIZES RAISING THE BAR FOR CONTENT

• "House of Highlights" creator Omar Raja, who now works on ESPN’s social and digital content, said that knowing what content will generate widespread appeal “comes with time,” and “that’s the hardest part because content is what makes you successful.” Raja, who has been creating online content for over a decade, told attendees at today's CAA World Congress Comes to You virtual event that “good content will always win,” but the “tricky part is me, you and 50 different people could have a different opinion on what good content is.” Raja: “You have to kind of see what the audience likes. I would say 80% of the time I personally enjoy the video, and 20% of the time I’ve just learned that people like this type of content.” Raja said at-home, trick-shot videos are an example of content that he personally does not care for, but will post because the “audience loves them.”
  
  
• Raja said although people may think the bar for content during the pandemic shutdown “might be a little bit lower just because people are bored,” the reality is that “you have to get the best of the best of the best for the content to work.” Raja last week said he had to create a video featuring “every best Michael Jordan dunk” to get 2-3 million hits. Raja: “The first week of quarantine the bar was very low. It kind of felt like I could post anything and it would get two million views. But now, people are kind of getting tired of, ‘Hey, we've seen this trick shot a hundred times. We've seen this type of video a hundred times.’ So now the bar just keeps getting higher and higher.”
  
  
• Raja discussed how he began his partnership with Turner Sports ;and Bleacher Report, and he said it was not until “all the celebrities starting engaging” with the House of Highlights account that he “got the attention of a few media companies.” Raja: “You had LeBron, Dwyane Wade, Snoop Dogg. And I think once those celebrities started following the account, engaging with the account, commenting on the posts, it started showing up on other people's feeds.” Raja said he first went with Turner because there were the “most persistent” and it “made a lot of sense” because Raja needed rights to NBA footage.

CHRIS PAUL KEEPING IN TOUCH WITH UNION MEMBERS

• Thunder point guard Chris Paul, who also serves as union president for NBA players, is doing what he can to keep in contact with his fellow members. Paul said of the NBPA exec committee, “We're on calls daily, weekly, not only about getting back to play but how to be there for our players. Trying to inform them on how we'll be paid going forward, or also just being an encourager. It's hard to stay focused and train during a time like this. So it's been an experience for all of us. But I think the good thing about us is that we're all trying to get through it together.”
  
  
• In trying to navigate the issues that face players during the pandemic, Paul told attendees at today's virtual CAA World Congress Comes to You event that he is balancing each individual’s interest and that of the players as a whole. The bottom line for him these days is that whatever way the league wants to move forward, health needs to be given top priority. “Even though there are negotiations that have to be had at some point and everyone's always like, ‘It's us against them,’ everything has been so collaborative since play stopped," he said. "Adam (Silver) has been great in communicating with us. That's the biggest thing as you know, in any situation, as long as you communicate and players feel like they're informed in what's going on, I think everything works smoothly.”
  
  
• As for what the sports world will look like once things return to some semblance of normalcy, Paul expects sports and life in general will be different. But he does not think that is a bad thing. Paul: “We'll all just be a lot more aware. I think the biggest thing that I'll come personally out of this pandemic with is the importance of time. As much as I talk, I always talk about time, but sometimes you say it, but don't necessarily really understand it, but I think the importance of being around my kids a lot more and them actually getting a chance to see dad in the flesh and not just see dad on the television.”

POTENTIAL WTA-ATP MERGER GAINS STEAM DURING PANDEMIC

• The men’s and women’s pro tennis tours have been divided since 1973, but the idea of closer cooperation has gained some steam during the pandemic, writes SBJ's Bret McCormick. Many of tennis’ major stakeholders have made strides in working together to confront the pandemic’s global impacts. Today, a pro-merger tweet from Roger Federer lent even more credibility to a possible combination of the ATP and WTA. Subsequent tweets from ATP pros Rafael Nadal and Vasek Pospisil confirmed that talks are ongoing behind the scenes.
  
  
• A united WTA-ATP would be a huge shift accompanied by major questions, such as whether across-the-board equal prize money would be paid out to male and female players, whether various TV deals could -- and should -- be consolidated and how logistical challenges like forming a novel organization with a new name and branding would be tackled.
  
  
• WTA President Micky Lawler, speaking today at the CAA World Congress Comes to You virtual conference, reacted to Federer's tweet by saying, "Roger's comments today were a great way to start the day because I think he paid ultimate respect to women and showed how far we've come as an organization. The crisis has forced every governing body to work much closer together and this is something I've personally wished for and worked toward for a long time."
  
  
• ATP chair Andrea Gaudenzi also confirmed to the N.Y. Times today that the talks between the two tours were legitimate. No further details have emerged, though, including any possible timeline for such a change. "Our sport has a big opportunity if we can come together in the spirit of collaboration and unity,” Gaudenzi said in a statement. “Recent cooperation between governing bodies has only strengthened my belief that a unified sport is the surest way to maximize our potential and to deliver an optimal experience for fans on-site, on television and online.”

SBJ SURVEY: 35% OF EXECS REDUCING SCOPE OF BUSINESS

• About a third of sports business execs have already reduced the scope of their operations due to coronavirus-related restrictions and suspensions, according to a recent survey conducted by SBJ and YouGov Sport. The survey was made available April 10-15 to all SBJ/SBD subscribers with the goal of gauging some of the ways the global pandemic has affected the sports industry. More than half of the 952 readers who completed the survey identified themselves as senior management. For more results, see the current issue of SBJ, this week's Unpacks newsletters and issues of SBD.

Download the YouGov Chart

COLLEGE COACHES GROUP AGAINST REDUCING MINIMUM SPORT REQUIREMENT

• A coalition of intercollegiate coaches released a letter that publicly voices their opposition to cutting sports, notes SBJ's Michael Smith. Specifically, they oppose a recent request by the Group of Five commissioners to relax the NCAA mandate requiring D-I ;schools to sponsor 16 sports. This comes on the heels of Cincinnati cutting men’s soccer and Old Dominion eliminating wrestling as cost-saving measures. “Reducing the minimum sports sponsorship requirement that would open the door to eliminating sports should not be an option,” the letter read.
  
  
• The Group of Five includes the AAC, Mountain West, Sun Belt, Conference USA and MAC. Their letter asked for a four-year waiver. Another group of D-I commissioners representing the 22 conferences outside of the FBS submitted a similar request today asking for a two-year waiver from the sport minimum. Cutting sports is considered one option for schools in budgetary distress since the pandemic hit. Many coaches are concerned that if schools temporarily shutter Olympic sports programs for 2-4 years, they won’t be brought back.
  
  
• The Intercollegiate Coach Association Coalition is a group of coaches’ associations for volleyball, wrestling, soccer, swimming and diving, lacrosse, gymnastics, baseball, softball, tennis, golf, rifle, ice hockey, field hockey, equestrian and water polo. “The economic impact of the COVID-19 pandemic places a lasting burden on both higher education and intercollegiate athletics alike, but slashing opportunities for students is not the solution,” the ICAC wrote.

LEADERS SEE PERIL FOR YOUTH SPORTS WITHOUT FEDERAL AID

• The coalition that on Monday asked Congress for $8.5 billion in federal aid to keep youth sports programs afloat during the pandemic has unified leaders from programs in underserved communities and a travel sports circuit built on club and tournament fees and the promise of heads in hotel beds. In today’s Unpacks podcast, SBJ’s Bill King spoke to two members of that coalition -- 1984 Gold Medal-winning hurdler Benita Fitzgerald Mosley, now U.S. CEO of non-profit group Laureus, and Jeremy Goldberg, president of youth sports platform League Apps -- about the peril facing programs that may not make it through the crisis without federal aid.
  
  
• “They’re fledgling; they’re living month to month,” Fitzgerald Mosley said, describing many of the programs her non-profit helps fund. “And some of them have been receiving fees from schools to support after school programming that’s focused on the kids at that school that need access. Those fees dried up when school was cancelled or suspended. So that revenue stream has gone away." She added: "That’s the real crisis here with the grassroots youth sports organizations, Will they be here in June, July, August, September or whenever we return to play? And can they continue to provide free access to youth sports, and the character development, youth development, social and emotional development of these kids that are in crisis every day of the year, not just during this pandemic.”
  
  
• For more, check out the full interview on today’s Unpacks podcast here.

WORKING FROM HOME WITH BAYERN MUNICH'S RUDOLF VIDAL

• Rudolf Vidal has been leading Bayern Munich's efforts here in the U.S. since 2014, and the shutdown hasn’t slowed down his mission to grow the Bundesliga club’s brand. Vidal, who has been quarantining in Miami, is confident Bayern will bounce back just fine along with the rest of the sports industry. “What we do now is step back and enhance what we’ve done in America. … We are in a very good spot and we see that there is a huge movement in soccer in general and we want to contribute in a decisive way,” he said.
  
  
• Communicating efficiently has always been a priority for Bayern, with staff and offices across plenty of time zones. There probably isn’t a technology that the team hasn’t been using in its efforts to stay in touch, Vidal said. He prefers video conferencing for a more personal touch. “Whatever helps to be closer to your staff,” he said. Vidal also is proud of the solidarity and empathy the organization is showing. “Everybody is working closely in this,” he said. “I want to help them individually and support them mentally, emotionally and also financially, when needed.”
  
  
• Vidal is encouraged by the Bundesliga’s plan to become one of the first European leagues to restart, aiming to get back on the field in May and finish its season by the end of June. Clubs began training in small groups earlier this month. While fans are the lifeblood of sports, Vidal knows leagues must proceed with caution upon any restart. “You just want to have an audience,” he said. “On the other hand, the financials force us so that we have to play those games. So, we will look at that first. Then, the audience, we will include when we can.”

• Want to share what your work-from-home setup is like? Reach out to SBJ's David Rumsey.

Vidal, who has been quarantining in Miami, is confident Bayern will bounce back along with the rest of the sports industry

SPEED READS

• The Atlanta Journal-Constitution checked in with Georgia Tech and noted that when the pandemic hit, athletic department staff “already had been using the Microsoft Teams platform,” making a transition to distance learning easier. Associate AD Phyllis LaBaw noted that “Sundays through Thursdays, from 2-9 p.m., advisers and tutors have been busy in virtual meetings with Tech athletes.” Football study halls are conducted via Zoom, and the “dependence upon virtual meetings has opened the eyes of the athletic department to their benefits even when campus re-opens.”
  
  

• SBJ's David Broughton notes Canada-based Rogers Communications came out with Q1 financials this morning, and media revenue decreased by 12%. The decline is primarily as a result of lower advertising and sports revenue, including with the company-owned Blue Jays, due to the impact of COVID-19 and the mid-March suspension of major sports leagues.
  
  

• ESPN’s Trey Wingo preached realistic expectations for tomorrow’s virtual NFL Draft to Barstool’s “Pardon My Take” podcast. Wingo, who will host the show across both ESPN and NFL Network, said, “The Draft is insane to begin with. … The way I’m looking at it, everything going up to the Draft is the same. How it plays out is how it’s going to play out, but I can’t worry about that. We’re just going to have to do the thing and figure it out as we go along. … It’s going to be messy. There’s no way around that."
  
  

• The Lubbock Avalanche Journal writes the combination of COVID-19 and a slump in oil prices is a “double whammy” for a school like Texas Tech. The program, “just up the road from the oil-rich Permian Basin where many of its most loyal friends reside, could well be as nervous as any program about donor giving.” Tech Senior Associate AD Jonathan Botros said total contributions are around 25-30% of the athletic department’s overall budget. The Bryan-College Station Eagle also looked at the oil slump's impact on Texas A&M, whose AD Ross Bjorksaid: "It’s hard to say exactly how much we’re dependent on it. I’d really have to do an in-depth study on that. We know it will have an impact. We know we have people that their livelihood, depending on what channel you are in in the oil supply chain, you are going to be impacted."

• White Sox team doctor Nick Verma is bullish on MLB returning sooner rather than later. Asked by NBC Sports Chicago’s “White Sox Talk” podcast if he envisions baseball in 2020, Verma said, “I do. Take the fan portion out of it, because that’s going to be a much bigger decision and probably will be delayed. … It comes down to our ability to have access and socially reasonable guidelines for testing. We shouldn’t have testing to play baseball if it means we can’t have testing in an emergency room. … Once we have that access to testing that’s applicable to society as a whole, there is a path forward.”

• The Harlem Globetrotters have "joined the list of organizations that have put staff on temporary leave in the midst of the coronavirus pandemic," according to the Atlanta Business Chronicle. The Georgia-based organization, which last month suspended its domestic and international tours through mid-May, has "furloughed 175 employees as of April 20." 

CLOSING THOUGHTS FROM WORLD CONGRESS COMES TO YOU

• SBJ/SBD Publisher & Executive Editor Abe Madkour wrapped up today's CAA World Congress Comes To You sessions with a word on maintaining community, honing core competencies and looking ahead to the industry's recovery from this unprecedented crisis.

 NEWS YOU NEED FROM SPORTS BUSINESS DAILY

• During this crisis impacting the sports business, we want everyone to be up-to-date on the latest news and information. SBD's "Coronavirus & Sports" section is free, outside the paywall, for the foreseeable future. Below are today's headlines:
  
  
  • Tigers, Rockies Seen As Leaders In Keeping Staffs Paid During Hiatus
  • Goodell Restates NFL's Plan To Play As Scheduled If Virus Allows It
  • Return For U.S. Sports Could Depend On Decisions By Canada
  • Bettman, Fehr Put Differences Aside In Attempt To Restart NHL
  •  Union Rep Says MLS Players Have Been Told Of Possible Pay Cuts
  • Real Salt Lake Facing Long Financial Road Back Due To COVID-19
  • Sources: U.S. Soccer Approved For PPP Loan To Help Cover Costs
  • Tennis Canada Enacts Broad Layoffs, Furloughs, Pay Cuts
  • Players Coalition Goes Beyond Social Justice Reform Amid Virus

SBJ UNPACKS -- WEATHERING COVID-19

• Check out the most recent editions of our "SBJ Unpacks" podcasts around COVID-19:
  
  
  • 1984 Gold Medal-winning hurdler Benita Fitzgerald Mosley, now U.S. CEO of non-profit group Laureus, and Jeremy Goldberg, president of youth sports platform League Apps talk about the peril facing youth sports programs without federal aid during the pandemic.
  • Former American Gaming Association exec Sara Slane discusses the downturn in sports betting during the pandemic.
  • SBJ's Bill King, Eric Prisbell & John Lombardo discuss the Paycheck Protection Program and how it can have an impact on the sports industry.
  • ESPN VP/Production Seth Markman discusses the network’s NFL Draft plans.
  • Mark Ein, who owns an ATP/WTA event and Overwatch League team based in D.C., discusses the tennis event and the sport at large, as well as esports' growth during the shutdown.

Something related to coronavirus and sports business catch your eye? Tell us about it. Reach out to Austin Karp (akarp@sportsbusinessjournal.com) and we'll share the best of it.