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Volume 27 No. 55

SBJ Unpacks: MLS League Office Reduces Workforce By 20%

Tonight in SBJ Unpacks: A source tells SBJ's Mark J. Burns that MLS has reduced its league office staff by 20%.

  • Liberty Media forms SPAC; Greg Maffei talks economic recovery
  • NFL, teams scramble to adapt to music industry threats
  • Pac-12 to allow nonconference football games
  • Esports execs on connecting with smaller, passionate communities
  • BMW exec talks getting brand into esports

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Source: MLS League Office Reduces Workforce By 20%

The MLS league office underwent a 20% reduction of its workforce today between the elimination of staffers’ roles and open headcounts not being filled, a source with knowledge of the situation tells SBJ’s Mark J. Burns. That equates to nearly 70 people, this person said.

Most departments were impacted by the reductions, according to the source, who also said that Commissioner Don Garber informed staffers of the news earlier this afternoon. The lone open position at MLS HQ is Head of Diversity, Equity & Inclusion.

Meanwhile, game day revenues for the league are down 95% in 2020 versus 2019 due to limited spectators. With full capacity venues still months away as well as a bleak outlook for 2021, the league made the decision to reduce staffing size, the source said. Those laid off will be provided a severance package and a few months of COBRA insurance. 

Additionally, tiered pay reductions for league staff, which began on April 16, are still in effect, the source said. Entry-level people aren’t included.

Liberty Media Forms SPAC; Maffei Addresses Economic Recovery

Liberty Media CEO Greg Maffei said today that the economic recovery from the coronavirus crisis "will be uneven across sectors, potentially creating investment opportunities for the sprawling media, sports and entertainment company." Maffei, appearing on CNBC, said: “The pandemic, in our view, will linger. This isn’t going to be a switch turned off or on, in terms of the economy. There are going to be different segments which come out at slower rates.”

Maffei said that the "likelihood of a variable recovery is one reason" Liberty, the parent company of the Braves and F1, have launched a SPAC -- which it intends to list on the NASDAQ after a planned $500 million IPO. Maffei: "One of the reasons we have the SPAC, one of the reasons we’re thinking through that, is to think about those investment opportunities that may result because of those consequences of the consequences of the consequences." 

Maffei also said that F1 "will be profitable" this year, but it "does not have the ability to generate the kind of income for the teams that they need to sustain long-term.” F1 earlier this month registered a $104 million loss in Q3, while the Braves saw Q3 revenue decline 48% to $110 million.

Pac-12 To Allow Nonconference Football Games

The Pac-12 has "loosened its scheduling restrictions for the 2020 season and will allow nonconference football games to be played if they meet a certain criteria," per ESPN's Kyle Bonagura. Three stipulations "must be met for one of its teams to play a nonconference game." 

Opponents "must be able to meet the Pac-12 testing and related safety protocols for COVID-19, which includes once weekly PCR and daily antigen testing for each day of close contact athletic activity." Pac-12 teams "must be the host site and games must be broadcast by ESPN or Fox Sports, the conference's television partners." And in the event a Pac-12 team "schedules a nonconference game early in the week and a Pac-12 opponent becomes available by the end of the day Thursday of the same week, the Pac-12 will require a matchup between conference teams."

NFL, Teams Scramble To Adapt To Music Industry Threats

The NFL will conduct meetings with teams tomorrow and next week to address the warnings some have received from lawyers representing the music industry, threatening fines for using copyrighted music on social media posts, sources told SBJ's Ben Fischer.

The letters, first reported by CBS’ Jonathan Jones, in many cases target music that’s on stadium PA systems while video is shot, which then can be heard on the resulting social or digital posts. Typically, teams have rights to play music in venue, but not distribute it socially.

Two sources said they expect the meeting to be “informational,” but one suggested the league should consider fixing the problem with a comprehensive, leaguewide license. Without a legal fix, teams will likely have to cull their archives and make big changes to how they produce content going forward.

For more, see today's issue of SBJ Football.

BMW Exec Talks Getting Brand Into Esports

BMW got their feet wet in the esports scene in 2017, becoming the official partner of the European League of Legends Championship Series (LEC). What did BMW see as the biggest benefit from its entry into the new space? BMW Esports Head of Marketing Pia Schorner, appearing at the SBJ/TEO Eports Rising virtual event, said brands like BMW are "always aiming for new fields to conquer."

Schorner: "The dimension around the whole esports area is so much bigger than expected, especially for us." While she admitted the space was "not the natural thing to do" for a brand like BMW, the LEC gave the company a "test run at an early stage."

Schorner: "Let me say that was a quick, but honestly spoken, a really cool activation. That's the way we gained a lot of experience in terms of esports and especially in terms of the esports community. ... It took some time to convince the BMW board ... how important it is to be part of that, because there are so (many) opportunities for us to catch up with the future."

Now three years after the LEC experience, what's BMW's vision regarding investing in the esports sector? Schorner: "Our main target for sure is brand awareness. And within younger target groups. ... Esports is the high relevant topic among these target groups, therefore we want to be part of their life. These people are our customers of today and also of tomorrow."

Esports Execs On Connecting With Small, Passionate Communities

When people hear about esports, they are hearing about the franchise-titled games that garner the big headlines. But the esports ecosystem has much more to offer. Evil Geniuses CEO Nicole LaPointe Jameson, appearing at the SBJ/TEO Esports Rising virtual conference, said away from those major titles is “where brands partners, fans, really get aligned and excited by that space.” LaPointe Jameson mentioned fighting games as one realm of esports where players have “leaned into their individual identity” and that is one of her company’s platforms to exhibit its emphasis on diversity and inclusion.

LaPointe Jameson: "We have players that are in the LGBTQ+ community. We have players that care heavily about mental health stigma. We have players that care heavily about making sure that they act as representatives as well as top tier competitive athletes."

Pipeline Co-Founder & CEO Stephen Ellis added, “A lot of brands find it really challenging to get involved with the tier one e-sports, whether that's because they're priced out or there's just not enough inventory. So as you start to move down into smaller talent, there's more accessibility. The challenge is finding how do you work with them in those different sectors.” 

Quick hits:

Panda Global CEO Alan Bunney, on creating relationships with brands on smaller titles: “Grassroots games that are untapped from franchise leagues allows flexibility and allow us to do so much more. … It allows us to say, 'Hey, you know, X brand, I think this is a good fit for you guys. Would you like to try this out?'"

LaPointe Jameson, on showing new sponsors the appeal of smaller titles: “If you can follow the storyline, follow the fan demographic and showcase ... brands tend to get excited because it's an easy step into e-sports that is still authentic and less daunting as some of the other big franchise, heavily regulated, lots of layer titles.”

Speed Reads

 

  • S.F.'s Department of Public Health "rejected the Warriors' ambitious plan to bring back more than 9,000 spectators to games during the upcoming NBA season," while "pledging to work with the team to host fans at Chase Center once the coronavirus pandemic eases," according to the S.F. Chronicle. City & County of S.F. Health Officer Tomás Aragón's letter to the Warriors "raises the possibility of allowing 25% capacity (about 4,500 fans) if San Francisco reaches California's yellow tier of coronavirus case rates." The county "recently moved two levels from the yellow tier to the more restrictive red tier." The Warriors' plan included "coronavirus testing for all spectators ahead of games, at a cost to the team" of about $30 million, and would have used the "more reliable PCR testing, rather than antigen testing."

  • The CFP management committee "agreed to keep the playoff on its current timeline and name a national champion as planned on Jan. 11," per ESPN. The committee also determined that if a semifinalist is "unable to play because of a COVID-19 disruption after Selection Day on Dec. 20, the selection committee would not choose a replacement team." CFP Exec Dir Bill Hancock "declined to speculate on what might happen." But he said, "The committee will continue to do its due diligence between now and selection weekend."

  • Pepsi saw a big jump in value earned on sponsored digital content during Week 10 of the NFL season, highlighted by the announcement that The Weeknd would be the Super Bowl halftime performer, according to new data from Zoomph. Compared to the average post from the NFL accounts this season, the league's post announcing The Weeknd got 8.5x more engagements on Facebook and 3.4x more on Twitter.

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