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WHY DID PGA AND LIV MERGE?


WHY DID THE PGA AND LIV MERGE?


I can answer that question with a one word response.

MONEY


That's the reality of the situation. Why did the PGA effectively about-face and join forces with the Saudi backed Public Investment Fund? There are a number of key factors that contributed.

ONGOING LEGAL CASES AGAINST THE PGA

The PGA was fighting a number of Players and also has a Federal Antitrust lawsuit against them. With the Merger the majority of cases will be dropped and the Federal Antitrust case may also be pointless at this point.


LOST REVENUE


The majority of professional golfers that left for the LIV Golf tour don't affect PGA event sponsorship or fan interest. There were a few key defectors that definitely contributed to lost revenue. Phil Mickelson, Dustin Johnson, and Brooks Koepka are household names that were noticeably missed from PGA events. Especially because the PGA Tour is still a primarily American Tour.


INCREASED OPERATING COSTS


The PGA Tour has increased its overhead. In part to try and remain competitive with the ridiculously high tournament payouts at LIV golf events. They were also limited strategically by the Federal Antitrust lawsuit. So it's anyone's guess how much money they had left in their war chest.


INCREASED SPORTS MARKET COMPETITION


Attracting and retaining fans to a specific sport is becoming more difficult. Sports that were considered niche are gaining in popularity. Soccer, Women's Basketball, and Mixed Martial Arts are fighting for an increased market share. It definitely hurt the PGA Tour to have to try and attract new fans from these emerging sports when they were having to fight LIV Golf to retain their current fans.



SO WHAT HAPPENS NEXT?


From what I've been able to figure out from the limited information available is that for the time being very little will change this year. The PGA Tour will continue with its season and the LIV Golf Tour will continue with theirs. If LIV Golf players wish to return to the PGA Tour they will have the opportunity to do so through some form of application process. They can't return until next season though.


Greg Norman who served as the spokesperson and face of LIV Golf during its development is probably out. He made a lot of derogatory comments about the PGA Tour and was left out of the merger negotiations. I would imagine that he is being sacrificed for the "greater good" as far as this merger is concerned.


LIV Golf was unable to secure any major Network deals for its events except for the recently signed deal with CW network. Obviously they aren't a major player in the sports space. The Merger with the PGA provides them with established relationships that could allow for LIV Golf events to be properly televised in future seasons.


The most shocking result of the merger could be the placement of Public Investment Fund Governor Yasir Al-Rumayyan as Chairman of the Board of Directors. A Saudi Arabian has become the most powerful person in World Golf.


There are going to be a lot of upset fans and players as a result of this merger. We may even see a few players consider retirement. In the end money talks, but who benefits? Golf benefits on a global scale. The Public Investment Fund has over 600 billion dollars. That's a lot of marketing power. We will see how much of that money was required to buy the PGA's compliance. Pure golf fans that are who are either ethically ambivalent or historically ignorant might benefit. I say might because there's no guarantee that any of their favourite players will actually return to the PGA Tour.


WHAT ABOUT THE LPGA?


A few years back I chose to primarily cover the LPGA Tour because it wasn't receiving a proportionate amount of Media coverage. Today I am very happy I chose that path. I don't expect the LPGA Tour to have to deal with issues of sportswashing anytime soon. Women's sports go relatively unnoticed by the Public Investment Fund and similar government agencies across the Middle East. Will money and greed still play a role? Of course it will, but not to the same degree we've seen in men's sports.


How do you feel about the PGA LIV merger?




Corbert de Ronde

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