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2022 in 13 opinions; The way we thought; AI v McKinsey; Enabling dictators and other hot sports biz trends; Why RICHWHITEMEN love LIV; ChatGPT and the journey to irrelevance; Grant Wahl RIP
Opinions are cheap, but then again so are we
Apple Podcast Review of 2022
The Unofficial Partner 2022 Opinion Generator
Our 13 most clicked on stories of the year.
Theme 1 of 2022: The answer’s Drive To Survive, what was the question again?
This week’s addition to the pile of BTS sports docs.
Theme 2 of 2022: The business media’s unwavering faith in RICHWHITEMEN
Four RICHWHITEMEN were asked if they’d invest in LIV Golf, the Saudi sportswashing meets Greg Norman breakaway league.
(Thanks to Dan Haddad of Octagon for linking me in to this on Twitter)
First, a word on the format, which is very on trend for sports biz 2022.
By gamifying the investment decision, the slow plod of business reporting can be rendered sexy. (An approach that led to the 2008 financial crisis, btw)
So, it’s LIV Golf as culture war. Padel as an existential battle between them and us. Etc.
The clip contains 4 features of Journalism as Entertainment:
The media’s absolute faith in RICHWHITEMEN as the source of truth.
The way in which the finance bros present general cliches and abstractions with bullet proof certainty.
The bias toward the new and untried over iterating an imperfect status quo.
The thrill of catastrophising, and the media’s role in maintaining an atmosphere of continuous pessimistic uncertainty.
Cuban, Leonsis etc are bullish on LIV in principle, but that doesn’t tell us anything we don’t already know.
The problem with LIV, previously noted, is not the idea, which has many interesting themes - global, teams, antidote to a complacent PGA Tour etc.
But the breakaway is incomplete. Stuck. (McKinsey has put numbers to this scenario, see below).
And worse than that. It’s really, really boring.
Compare the views of the RICHWHITEMEN with ChatGPT, the AI tool that’s currently writing your kid’s Sociology A Level essay.
ChatGPT can’t answer specific LIV questions because it’s data scraping isn’t up to date.
But it can match Mark Cuban, generic sports biz cliche for generic sports biz cliche.
This week, New York Times broke a story that takes us inside that McKinsey’s original LIV Golf deck. There’s some revealing details.
In its analysis, McKinsey called the golf league “a high-risk high-reward endeavor.”
They ain’t kidding.
The consultants detailed three possible outcomes for a franchise-driven league: languishing as a start-up; realizing a “coexistence” with the PGA Tour; or, most ambitiously, seizing the mantle of dominance.
In the most successful scenario, McKinsey predicted revenues of at least $1.4 billion a year in 2028, with earnings before interest and taxes of $320 million or more. (Federal records show that the PGA Tour, a tax-exempt nonprofit, logged about $1.5 billion in revenue and posted a net income of almost $73 million for 2019.)
By contrast, a league mired in start-up status — defined as attracting less than half of the world’s top 12 players, navigating a “lack of excitement from fans,” reeling from limited sponsorships and confronting “severe response from golf society” — stood to lose $355 million, before interest and taxes, in 2028.
So, + $320m to - $355m.
Given LIV currently feels like a ‘languishing startup’, I wonder if Mark Cuban’s still interested?
Theme 3 of 2022: Enabling the worst people in the world
It’s worth pausing on McKinsey for a moment.
Because the famous consultancy is emblematic of something broader: Sport’s enablement supply chain.
Major events are held in places you wouldn’t choose to live and controlled by people you’d cross the street to avoid, but from whom you are happy to take money.
It’s a pact that’d make Faust blush.
This amorality runs alongside the corresponding rise in brand and purpose, which makes us all feel better about ourselves.
Psychiatrist have a name for this trick, it’s called compartmentalising.
Compartmentalization is a form of psychological defense mechanism in which thoughts and feelings that seem to conflict are kept separated or isolated from each other in the mind. It may be a form of mild dissociation; example scenarios that suggest compartmentalization include acting in an isolated moment in a way that logically defies one's own moral code, or dividing one's unpleasant work duties from one's desires to relax. Its purpose is to avoid cognitive dissonance, or the mental discomfort and anxiety caused by a person having conflicting values, cognitions, emotions, beliefs, etc. within themselves.
“Like many other major corporations including our competitors, we seek to navigate a changing geopolitical environment,” the company said, “but we do not support or engage in political activities.”
Still, some analysts, veteran diplomats and experts on global governance see McKinsey’s role in a different light.
While the United States pulls back from international cooperation and adopts a more nationalist stance, major companies like McKinsey are pursuing business in countries with little regard for human rights — sometimes advancing, rather than curbing, the contentious tactics of America’s biggest rivals.
“It is more likely they enable these regimes and likely become complicit,” said David J. Kramer, a former assistant secretary of state. “They don’t want to alienate regimes, or they would lose business.”
The Long View
Pickleball got hot in ‘22.
But, have a look at how tastes change over time.
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I first heard Grant’s name when he stood against Sepp Blatter for FIFA President.
Then I read his excellent book, The Beckham Experiment.
I’m sad I only got to know Grant via remote podcasts, email exchanges and shared stories.
As has been noted many times elsewhere, he was a very generous man, who went out of his way to help others.
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