PGA Tour's New Alliance

A quick reminder before getting into our subscriber content… For weeks now we have talked about our book called GolfStats Guide to the 2024 PGA Tour season.

The book previews every event from the Sentry through the Tour Championship, giving important information in making picks. The book looks at the top 80 players on Tour and gives you charts you have never seen before. Here is a link to hint at what kind of content the book will have. And another example of the detailed player guides.

Our premium members can find the book in their Account section. All GolfStats Insiders who wish to purchase the guide only can do so by upgrading to a premium newsletter subscriber.

Of course the best way to get it for free is to subscribe to one of our annual packages on GolfStats.com

“You wanna get Capone? Here’s how you get him. He pulls a knife, you pull a gun. He sends one of yours to the hospital, you send one of his to the morgue. That’s the Chicago way and that's how you get Capone.”

That is a line from "The Untouchables" starring Kevin Costner and Sean Connery.

This has been the story between LIV Golf and the PGA Tour for over two years. We thought there was a solution to the problem in June, but things worsened when Jon Rahm went to LIV golf, followed by Tyrrell Hatton. The move by LIV Golf was like a bazooka blast sent to the PGA Tour.

But on Wednesday, the PGA Tour hit back with the mother of all bombs, which could change the landscape of this problem.

The PGA Tour announced their alliance with Strategic Sports Group in which they are going to invest $3 billion into a new business model called PGA Tour Enterprises that will be a game changer for the PGA Tour.

For the last couple of years, LIV Golf has taken some of the best players in Golf with lucrative bonus money to play on LIV Golf. In the beginning, Dustin Johnson, Brooks Koepka, Sergio Garcia, Bryson DeChambeau, and Phil Mickelson went to LIV Golf. They added Cameron Smith after he won the 2022 British Open and then went quiet for a bit. All this led to lawsuits and turmoil between the PGA Tour and the Public Investment Fund of Saudi Arabia. They started talking and announced a possible agreement to the problem in June. The deal stopped the lawsuits, but a provision was supposed to be made before the end of the year to have peace between LIV and the PGA Tour, along with a way for LIV players to return to the PGA Tour and DP World Tour, along with a possible merger with LIV Golf.

The first reaction by PGA Tour players in June was that they felt broadsided, as Jay Monahan never consulted with them. Despite the possible peace, most members were divided over the plan, as days stretched into weeks and months. There was complete silence on a possible final agreement. Over the fall, rumors about players that LIV Golf was trying to add to their tour confused many because the animosity grew instead of having peace. In December, when it was announced that Jon Rahm would join LIV golf for a rumored $500 million, the problem reignited. Rahm became the most prominent player taken from the tour, and many felt that the agreement between the tours and the PIF of Saudi Arabia would not happen. Behind the scenes, Monahan and tour officials looked for other possible partners.

One stepped up was the Strategic Sports Group, an organization that helped sports teams develop new revenue streams through renovation projects, premium sales, and new partnerships. The group was set up by John Henry and his Fenway Sports group, which owns the Boston Red Sox and several other sports teams. Some other key players are hedge-fund titan Steve Cohen and Home Depot co-founder Arthur Blank. They own the New York Mets and the Atlanta Falcons. Others include Thomas Ricketts, who owns the Chicago Cubs; WYC Grousbeck, who owns the Boston Celtics; and Gerry Cardinale, who owns Italian soccer powerhouse AC Milan through his RedBird Capital Partners and was one of the founders of the New York Yankees' YES Network. There are many others in the group, but the point is that all these folks are the cream of the crop in sporting ownership and are all billionaires. They are the types that will only do something if they can make millions off the effort. So the big question is, how is money going to be made?

We will get back to that a few sentences down.

Returning to LIV golf and all the players in that league, they are not missed on the PGA Tour, nor have we seen lower TV ratings with them leaving. We didn't see people stop buying tickets for the Sentry, American Express, Farmers, or AT&T Pebble because Jon Rahm wasn't playing. I haven't heard anyone say the PGA Tour misses these guys because champions are crowned every week, and in most cases, most of the fans are happy. But I can say this: the winners of the first four events, Chris Kirk, Grayson Murray, Nick Dunlap, or Matthieu Pavon, would possibly not have won those events if Jon Rahm, Dustin Johnson, Brooks Koepka, Cameron Smith, Joaquin Niemann, Bryson DeChameau, Adrian Meronk, Patrick Reed or even Phil Mickelson were playing.

The players will get ownership, and money will flow from that. Also, purses will increase, and they will play for even more money. All of this should bring on a new initiative for the PGA Tour.

So, how does this get paid for?

The tour will have a second side called the PGA Tour Enterprises, in which the $3 billion will flow from the Strategic Sports Group. The tour now gets money from TV rights fees, media rights, and sponsorships. All of these have done a great job but are very taxed. The sponsors have already said they are paying the most they will. The same is true with television; the two networks that do TV, CBS and NBC (who own Golf Channel), are losing money in the new contract that goes through 2030. With all of these taxed to the max, creative new ideas must be found because nothing can be squeezed from these entities.

That is what Strategic Sports Group will do. In all of the releases of this partnership, nothing has been pointed as to which direction the tour and their new partners will go in raising more money.

So we will have to imagine some of the things they will do to bring in more cash.

Off the bat, gambling is one item that hasn't been done that could be utilized more for income. The tour will go full blast with this and finding ways to align themselves with the TV Networks. One of the biggest problems that needs to be fixed with the telecasts now is keeping fans apprised of all players' scores, not just the leaders. For the last couple of years, telecasts do not want to show the scores of the whole field, which means when I sit down to watch a telecast, I have to look on my iPad through scores on PGATour.com. In the future, they will have to fix the problem, possibly by doing what LIV golf does; they "borrowed" what we have seen for years on telecasts of Formula One: full leaderboards of 25 names on the right side of the screen.  If Golf telecasts had something like this, they could show you all the scores every five minutes.

I see this because they will have to do a better job of keeping fans up to date on the scores of the whole field, not just the five or six we see now. Another thing for future telecasts: I could see another TV entity in two years like the one we see on Monday Night with the ESPN Manning Cast, which is the network feed with a new theme brought on by the commentary of the Manning brothers. This feed would be the network telecast but mixed with a gambling angle, helping people make bets and allowing them to make bets on their TV screen or through apps.

You could be watching the final hole of the Farmers Insurance, and a proposition comes up if Matthieu Pavon will win the tournament, and you can make this bet. Throughout the three-hour telecast, there will be hundreds of possible ways of betting during that tournament live, thus making it exciting for many. Strategic Sports Group will also create a team concept like Rory and Tigers' TGL league, in which events will be played the Monday after the event. This would bring on new revenue streams and give fans another opportunity to watch their favorites. Also, with their relationship in other sports, Strategic Sports Group could get players from the NFL or MLB to participate in these team events, another way for fans to gamble.

Strategic Sports Group will make Golf very global, but as we saw with the World Championship Golf events, going outside the United States is more complicated than it looks. There is less sponsorship money; sometimes, players don't want to jet off to Australia for the weekend. But their tune changes when you stick these players on special, first-class charters. Frankly, we have different visions than the folks at Strategic Sports Group have. They probably already have ideas; they must figure out how to monetize them. So, there is no thought of this being nothing more than a homerun.

So, if this is successful, what happens to LIV Golf?

It disappears after this year. Many need to know that the whole LIV concept was for three years. They paid off players and those on TV making the telecast; all contracts and personnel were on for three years. So, after this year, the PIF will have to decide if they want to fund LIV golf in the future. With the new alliance with the Strategic Sports Group, I could see a path for LIV players to return to the PGA Tour immediately. I see the PGA Tour allowing these players to participate in tour events, but they will have to wait a certain amount of time before they can have ownership, thus losing millions. But over months, a year or two, they can return to good graces and then enjoy the money ownership brings. Who knows, the door is still open to the PIF to do a deal with the tour and be another arm alongside those from the Strategic Sports Group. If that doesn't happen the Saudis could be top dog willing to continue to stake the billions for LIV golf. They could also do their own partnership with the European Tour; anything is possible. The one thing I see as going to happen is Saudi Arabia will still want to be a part of Golf somehow.

So the whole flux of this is, will this benefit the fans of Golf and possibly open up the door for a new fanbase for Golf? The more fans, the more they can charge. I also think that for those who like to gamble, this new partnership will open up many gambling opportunities in the future.

We will see the progress of all this in the coming weeks and months. But there will be change coming to the PGA Tour. I see the PGA Tour going from January to the end of August, with new championships, team events, and pro/celebrity events worldwide from September to December.

So, the future of golf will be very different in the next few years, and the players will get even richer.