Moag & Company Sports Notes (03 Sep 2021)

Date: Sep 2021

Trivia

How many minutes was the longest recorded point in the history of tennis?

Last Week’s Answer: Serena Williams has won the most Grand Slam titles of the Venus sisters with a total of 23 titles.

Football:

As fall sports open under a new normal, no one is going to be happier about the return of these games than the athletics directors who still are dealing with the financial and scheduling impacts of last year’s cancellations, as more than $171 million is scheduled to exchange hands this season for Football Bowl Subdivision (FBS) non-conference games, according to USA Today. The school bringing in the most money is Kent State, with guarantees worth $5.2 million. In addition to Kent State, 45 schools are set to make over $1 million off guarantees in 2021. The pandemic forced changes to the landscape of these games. Contracts were amended, games were postponed, and force majeure language allowing no-obligation cancellations due to unforeseen circumstances was changed. The pandemic also could change how the market for non-conference games operates. While smaller FBS schools rely on guaranteed money, Power Five programs still felt the impact of cancelled games. Power Five schools lost tens of millions of dollars because of attendance restrictions and lost gate revenue. Regardless of whether schools fill stadiums this season, there is a chance that the pandemic will impact the future market for non-conference games -- prompting schools to think more carefully about who they want to play and what they want to pay.

Baseball:

MLB as part of its collective bargaining agreement (CBA) proposal to the MLBPA last month offered to curtail the impact of service time by creating a formula to disperse $1 billion to all arbitration-eligible players and make free agency universal at 29 ¹/₂ years of age, according to The New York Post. MLB was, at minimum, looking to address the union’s concern about service-time manipulation. Right now, all players who reach six years of service can be free agents and all who reach three years plus the top 22 percent in service time between two and three years (Super Twos) are eligible for arbitration. What MLB proposed was to create a $1 billion pool (and to tie that pool total to revenue in future years) for all eligible players, to replace arbitration. A formula would be created to determine how much players would receive. Sherman noted arbitration-eligible players received roughly $650 million for this season. Free agency at 29 ¹/₂ (birthdays before or after July 1 would determine the half year), would allow all players to get at least one free agent shot in their twenties. Still, the union almost certainly would see both issues as problematic. A pool of money distributed to players falls at least within the genre of a salary cap, and while free agency at 29 ¹/₂ would help players (often those who went to college) who started their major league careers older ... it would greatly expand the team control of star players ... who began their major league careers young. For example, Nationals LF Juan Soto would have to play 10 seasons to reach free agency.

Basketball:

Adidas has implemented a more strategic criterion for deciding which players it has looked to sign heading into the 2021 NBA draft and the fall sneaker free-agency window. The Undefeated reports that Adidas is narrowing down its list of NBA endorsers, from a bloated roster of 80-plus players three summers ago to a more focused and targeted 40-50 athletes now. Performance on the court is one characteristic, as are off-court style in an Instagram-centric world, having a vibrant personality, and bringing a blend of that presence and confidence to inspire a future generation. Players like Rockets G Jalen Green, Cavaliers C Evan Mobley, Magic G Jalen Suggs and Hawks G Sharife Cooper each bring their own style and dynamic. Many observers feel Adidas came away with the best overall draft class of signings. Meanwhile, Adidas is undergoing a bit of a reset in its product approach, its overall structure and the era of athletes it’s looking to partner with. This fall, the company will launch the first signature shoe of Hawks G Trae Young. Signature series already exist for NBAers James Harden, Damian Lillard, Derrick Rose and Donovan Mitchell, whose shoes the young guns are expected to wear as they begin their rookie seasons. The next face of Adidas Basketball’s resurgence is fashion designer Jerry Lorenzo. A big-picture strategic change was also decided on for 2021, with the merger of Adidas Basketball and its longtime lifestyle category Adidas Originals in the corporate structure.

Hockey:

The Hurricanes tendered an offer sheet to Canadiens restricted free agent C Jesperi Kotkaniemi over the weekend, marking the latest salvo in a quietly simmering feud between the two teams, according to Raleigh New & Observer. The Hurricanes offered Kotkaniemi a 1-year deal for $6.1M and a $20 signing bonus. The Hurricanes probably wouldn’t have been as motivated to put the Canadiens in the absolute fix they’re in now if the Canadiens in 2019 had not offered Hurricanes C Sebastian Aho a front-loaded offer sheet that was a complete no-brainer to match. But the old-money-nouveau-riche tension between the two franchises didn’t start with the Canadiens’ offer sheet to Aho. It goes back 20 years, to the extraordinary events of two remarkable playoff series that saw the Hurricanes win twice, clinching both at Bell Centre. The Aho offer sheet didn’t arise from that, but it certainly fed into it, mocking Hurricanes owner Tom Dundon’s willingness to dip into his pocket to pay Aho an immediate $11 million signing bonus. Now Dundon and the Hurricanes have returned the favor, and not merely for revenge. From the $20 signing bonus to the salvos of Twitter trolling and the press release cut-and-pasted from Montreal’s own on Aho, this is "more than retribution".

Soccer:

Cristiano Ronaldo has agreed to a sensational return to Manchester United, the club announced, in a $17.7 million deal with a potential further $9.4 million in add-ons, according to The Financial Times. The 36-year-old has returned to Old Trafford 12 years after leaving the club and will sign a two-year contract. ManU posted a collage of Ronaldo from his previous playing days at the club on Twitter along with the words, “Welcome home, @Cristiano." The Portugal international left ManU after six seasons for Real Madrid in 2009 for a then world-record fee of £80M but will now make an emotional return. It was reported in June that Ronaldo's representatives were gauging interest from some of Europe's top clubs, and Man City was one of the clubs that looked at the possibility. After talks between Ronaldo, ManU and Juventus began, Ronaldo did not train with Juventus, and instead left Italy on a private jet. Juventus Manager Massimiliano Allegri later confirmed that Ronaldo had asked to leave the club before the transfer deadline. Even by the standards of football transfers, which often defy all rational thought, this was a head spinning 24 hours. The deal highlights the enduring appeal of Ronaldo -- both on and off the pitch -- despite his advancing years. ManU's N.Y.-listed shares rose 7%, valuing the club at more than $3 billion by market capitalization. Ronaldo's imminent return to the EPL marks the latest twist in a remarkable summer for high-profile soccer transfers. Despite being in the tail-end of their careers, both Ronaldo and Lionel Messi remain highly attractive to commercial partners. Although ManU's finances have suffered from the pandemic, the club has avoided asking shareholders for more capital. However, Juventus approved a $472 million equity fundraising to strengthen its balance sheet.

Other:

ESPN is seeking to license its brand to major sports-betting companies for at least $3 billion over several years, aiming to capitalize on the fast-growing online gambling industry, according to The Wall Street Journal. The sources said that ESPN has held talks with players that own major sportsbooks, including Caesars Entertainment and DraftKings. ESPN has existing marketing partnerships with both companies. They report that on offer is the right for a suitor to use the ESPN name for branding purposes and potentially rename its sportsbook after the net, and a deal could come with an exclusive marketing commitment that would require the sports-betting firm to spend a certain amount of money advertising on ESPN’s platforms. ESPN has been cautious about entering the sports-betting arena. Execs have said that they want the company to avoid being directly involved in gambling transactions. A brand-licensing deal would allow ESPN to profit from the boom in sports gambling without taking bets and making payouts to winners, which requires licenses in individual states.

Sources: The Financial Times, The New York Post, Raleigh News & Observer, SportsBusiness Journal, USA Today, The Undefeated, The Wall Street Journal

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