PODCAST | EP #1 | SPORTS | What will happen to sports? Sports industry veteran Murray gives me the inside scoop from London.

Recorded LIVE | March 25th, 2020

A veteran of the sports business having worked for 20 years for NBA, ESPN, World Rugby, and most recently Formula One, my friend, Murray Barnett talks about how the business is going to change due to COVID.

TRANSCRIPT

March 25 — Murray Barnett

Gavin: [00:00:00] Hey, it’s Gavin. Welcome to the for friends and family podcast. Uh, you should know who I am. If you don’t, then you maybe shouldn’t be listening to this, but I have decided to call all my friends all over the world and get perspectives on what. The Colvin pandemic is doing in their location, but also what’s happening to industries.

And, uh, right now it is Wednesday, March 25th, it’s 10:06 AM in Los Angeles. I’m in Venice beach, California, as you guys know. Um, and on the Skype with me is, uh, my friend Marie Burnett. He, uh. The reason why I wanted to bring him on is, is that he is a veteran of the sports business. He’s been in it for 20 years.

He’s worked for the NBA at ESPN world rugby and most recently, uh, formula one, he has a good idea. His Twitter feed is phenomenal. And, um, I’ll get him to tell you a bit about that as well too, so that you can follow him cause he really gives good updates on what’s happening in the sports industry. So welcome Marie.

Murray: [00:01:05] Right. Nice to have. Nice. Nice to be on the phone with you.

Gavin: [00:01:08] Nice. Um, so you’re on lockdown with your family. What’s it like in your, in your, in Hammersmith, uh, which is sort of West London, uh, what’s it, what’s it like for you guys?

Murray: [00:01:17] Yeah, it’s, it’s a bit weird. So this is the first week of homeschooling, which, uh, at least at my house has gone, surprisingly well.

Gavin: [00:01:27] Surprising. Are they doing any schoolwork? Are they just playing video games?

Murray: [00:01:31] No, I don’t. It’s so, I must confess, we have a super smash brothers tournament every night. But, uh, aside from that, they have actually been knuckling down and working during the day.

Gavin: [00:01:42]Is it video conferencing? Is that what they do?

Murray: [00:01:45] So it’s, it’s, it’s interesting. So my eldest, who’s 12 he’s at a, at a private school, and they’ve been really good at setting everything up on Microsoft teams and sort of generally being very well organized. My youngest is at a state school. We’re a small state school, and yeah. They, as they as well seem to sort of approach this slightly different way in terms of kind of emailing the night before saying, this is kind of a rough idea of what you’re going to do the next day seems to be a little bit less interactive.

But the point being is that depending on which school people go to, they’re seeing that they seem to have a variable experience of it. But I think it also comes down to, you know, how diligent the parents and the teachers are in terms of looking after the kids. And to be fair, you know, I read a great thing.

Yesterday. That was just saying the most important thing is this is a scary time for them as well. So even if they don’t follow the curriculum, you’ve got to just make sure you look after their mental wellbeing. Cause I think it’s easy just to try and think that they should just be doing schoolwork. But it is scary for them too.

Gavin: [00:02:47] How are, how are, like, how are the kids in the UK taking it emotionally? Like have you noticed anything in year two kids? Because you have two kids and how old are they?

Murray: [00:02:56] Yeah. They’re nine and 12.

Gavin: [00:02:58] And they’re both boys right.

Murray: [00:03:00] Yeah. Two boys. I mean, it’s, it’s weird. I mean, I, well, I think it’s just true for me as it is for them.

I’m not sure that the sort of enormity of this has really kind of hit home. I had the first friend of mine, uh, who. A relative of theirs has died of turbid 19 and that’s the F this was just yesterday. And so this is, that’s the first time where it’s been that close. I think up until now, it’s kind of just been felt very surreal because, you know, you go around and it’s not like there are people dropping dead on the streets.

So you just hear these horrendous numbers and, and it, and it. But it feels somewhat remote, and that’s the first time it was kind of brought it home to me.

Gavin: [00:03:40] It’s sort of like a tsunami. I feel like it’s a really slow, like people are slowly figuring out there. They’re seeing the, you know, the wave way in the distance, and then they’re like, oh, it really feels like when we had tsunamis coming in, when you saw the videotape or the video of.

People just looking at and going on, not a big deal. And then you see it getting closer and closer, and then they run and panic. And I think that’s, that’s going to happen. Well, let’s talk a little bit about sport because obviously, as, as you know, I’m a huge EPL guy, English premier league arsenal is my sport, USR. I’m so sorry that I’m, um, that you support spurs, but that’s okay.

Murray: [00:04:15] Um, this is great for us, right? If the season is, is delayed or even postponed then that’s fantastic news for us because for those of you that don’t follow it very closely. We’re not having the greatest of seasons this year.

Gavin: [00:04:27] Yeah.

We’ll ever pull them us because they’re going to win at all. Um, anyway. Uh, let’s talk. Let’s just go right to formula one. Formula one is essentially canceled. Most of the races, they’ve moved everything back. But actually, before I go to Formula One and let’s just go to sport overall, like this is a huge deal.

How is this going to impact the sport industry and how are people going to recover and what’s the amount of money that people are losing? Like what’s going to happen.

Murray: [00:04:53] Well, I think, um, there’s lots of questions in that, so I think. The, the, the one thing about sports is sports is generally very well organized and very regimented.

So people know when a season is going to start, when a season’s gonna finish, how many games they have to play, what the rules are in terms of how many points do you need to win and how many points you need to stop being relegated and all this kind of stuff. And that’s the biggest, uh, thing that’s kind of really upsetting for everybody and sort of really making it difficult is having just this uncertainty of not knowing, you know, whether we’re talking about one month, three months, six months, nine months, a year, whatever.

I mean. In my personal, unscientific opinion, we should just assume that 2020 it’s a write off for sports and even if any sport does get played, it’s going to be with a little kind of asterisk next to it of like, you know, a part season or played behind closed doors or whatever. But you know, I think once you get below that level, there are different grades of sort of difficulty because.

You know, arguably you could get to a stage where something like English premier league could be played even into conditions where mass gatherings are not allowed. I that it gets to the stage where they could be played behind closed doors, for example, because it’s still a national league happening in one place, could be relatively homogenized.

Whereas you look at something like formula one, which, which takes part around the world. Aside from the logistical issues of kind of getting teams and tracks and everything ready. You also have this idea that people are sort of traveling all over the world, and I think that there is a, there’s very little likelihood and a thing that involves international travel will be up anytime soon.

So that’s why you see the cancellation of the Olympics.

Murray: [00:06:47] Well, sorry, can I split it to 21 yeah, but I mean, in terms of 2020, there’ll be no, there’ll be, I don’t think in 2020 there’ll be any international sport involving fans or teams traveling cross border.

I think there is a chance that in the latter part of this year, you’ll see some sports coming back, uh, for national competitions. With varying degrees of, um, fan engagement on, uh, you know, on site as it were. And I should say this is all very unscientific. This is just kind of my own personal opinion, but I think that the w where when sports does come back, it’s going to come back in two ways.

You’re going to have the big sports like NBA, EPL, and others coming back with a vengeance. And I think you’ll see some great ratings. I think you’ll see people coming back to it looking for. I was going to say salvation probably sounds too dramatic, but certainly some kind of distraction from everything that’s happened.

But I do think that any sport that’s trying to establish itself or grow its fan base, um, is going to struggle to, to sort of recapture an audience. And I think you’ll see a lot of clubs say in the lower divisions of, uh, of football, say in the UK or elsewhere. May not have been able to survive in the interim while the viruses is still forcing a lockdown on everybody.

So yeah, long winded way of saying, I think that the strong will will, will get stronger afterwards and the weak may may die off before this is over.

Gavin: [00:08:18] So, and that’s a great segue into the athletes, right? These, these, these guys are playing week on, week out. The human body is a machine. It needs to be maintained to maintain the very, very high levels of, for example, like, you know, soccer or football.

Um, I mean, you were talking about like. These, these people are operating it at a very, very high level when, when the, the muscles atrophy and people aren’t playing at those high levels anymore. Uh, and I’m, I’m sure there’s lots of training that can be taken place. I’m sure there’s lots of personal trainers that are, that are working these guys out, but there’s nothing like competition that makes people go to that next level.

My feeling is that it’s, it’s. Probably going to take a good year, 2021 just to get people back up to the level. But I S I guess it’s the same for everybody. Um, so the teams that are going to have the advantage of the ones that can really stay in shape, but I think that once they lose control of the, you know, the players, it may be difficult to keep everyone in alignment.

And, and, and that’s what worries me a little bit is that the, the level won’t be as good as it was.

Murray: [00:09:21] Well, just before I was talking to you, I was, uh, speaking to a CEO for a top division rugby club in New Zealand, and he was telling me that they have worked overboard to make sure that they’re 40 or so.

Rugby players each have customized plans, which they can follow at home. Know they’ve dispersed all of the equipment that they had centrally in their gym, to the players who don’t have their own facilities and that in their home. For those of you that don’t know, you know, a top level rugby club in New Zealand will have a least half a dozen.

All blacks, national team players who, you know, will be owning probably somewhere in the region of half a million bucks, up to a million bucks. Um, so, you know. Top, top level rugby players, and they largely have their own sort of gyms and stuff at home. So some of the lesser players have been given some of the equipment that the club owns.

And given all these customized training tools, they’ve all be set up with my Microsoft teams programs and so on. So in terms of just staying fit, and I think for a, you know, professional athletes, it’s a mental thing as much as a physical thing that if they don’t have that structure around them. Training and, and, and doing and working out it, you know, it starts to affect them mentally.

So I think from a sort of physical perspective, they’ll be largely, uh, well looked after in, in the top level teams. But I think you’re absolutely right that the, the intensity of competition is impossible to replicate. But I think there’s an interesting thing here and you know, we talk a lot about it now and you know, Gavin, you work in it all the time.

Is this whole thing about sort of, you know, social media and how. Athletes and people build their own brands through social media. And I actually think this is an amazing opportunity for athletes to really be able to connect with their fans. And again, I was talking about it with this buddy of mine this morning, and you know, saying, look, this is the perfect opportunity for these rugby players to be able to.

You know, do workouts online that people can follow, that they can do daily, sort of, you know, Q and a sessions or training sessions or tactics talks or whatever it is, and talk about, you know, they, they’ve got plenty of time on their hands now.

Gavin: [00:11:28] They can really. They connect with the fans, like they can connect with the fans in a way that they’re not that because there’s really nothing re re, you know, restricting them from connect. Are there any sports that you think that are going to rise up out of this that don’t really require, you know, I think about online gaming, obviously like all the e-sports that put that aside.

Are there any like sort of in-person sports, um, is sailing gonna take off. For example, because that’s never, you know, never, hasn’t normally has big crowds, um, around it, or it does. But, um, you know, are there any sports in, in your, in your purview that you think that might actually, this might actually benefit or that people might gravitate to?

Murray: [00:12:11] Um, our depression in a slightly different way and say that. This is a great opportunity, you know, spill. Any sport is built around, uh, characters and personalities. And if you think about the, you know, you probably follow two or three sports quite closely, and then outside of that, things are kind of just in your periphery.

But, you know, when I look at my own experience, you know, I was a massive tennis fan when you had beyond Borg and John McEnroe and Jimmy Connors and those guys. Yeah. Um, so I think that. Yeah. But I’m not a massive tennis fan now, for example. And I think something like this, if there are characters which are able to, to, to sort of rise, rise through increased engagement with their, so with a firm base, there’s an opportunity for those personalities to help build those sports.

And I, I can’t tell you what those are now, but I think that there will. Be some sports that benefit because people will feel like they’ve connected much more with the personalities of some of the participants. I’ll give you something like formula one is it has got a great opportunity because you know, it’s got a bunch of young drivers who are media savvy but aren’t very well known.

Uh, Lewis Hamilton, at least from the outside, doesn’t look like he’s engaging particularly. Other kind of individual fan bases, looking at it more as playing the statesman role in, in formula one, which I guess he should do. Um, but there are others underneath it that really get how social media works, and I think that they have a chance to really build the.

Build that profile. Are you close? You’ve got, you know, the Netflix series, which means that, you know, people have got plenty of time on their hands to stop watching all of these key series on various different sports and so on.

Gavin: [00:13:50] Yeah. The Netflix series, I have to say, if you haven’t watched it, um, if you’re, if you’ve never even thought about formula one and you’re not a race car person to watch that series, I, I am a formula one.

You know, I love formula one and I learned so much. I, it was such a great series. Um, and it th the, the drama, you don’t see that on the track. You don’t see, cause you don’t know what’s going on behind the scenes. And when you see behind the scenes, I’ve watched all the behind the scenes once, like the, the ones, uh, for football, for NFL are amazing.

The ones behind the scenes, you know, with Barcelona, the soccer club or the football club. Um, but the one for formula one was. I might be a bit biased, but it was, it was riveting to watch. And now you’re, you know, there’s lots of interesting things being dropped. Like last night we started watching the English game, which is a dramatized, um, uh, series of the 18 hundreds, um, of when, you know, soccer or football started in England.

Um, and how, um, and how it started, and it’s written by the guy who wrote Downton Abbey. So my wife and I are watching it together and she loves all the drama part with the. That with the women. And I’m, I just, I am learning about how the, the, the, the actual sport was built. Um, and it’s re, you know, I think there’s this disruption is, is, is giving people that pause, I think.

I think it’s giving it a bit of bit of time. And I think when sport comes back, I agree with you. I think people are going to be just rabid for it. They’re just going to be like, Oh, finally my teams are back. And you know, we’ve had this little rest. I think it’s going to go to the next. The next level. What I am interested in understanding is that for your two boys, what are, are they watching any sport online?

Are they doing e-gaming? What are you hearing about from their sort of generation in terms of sport? It’s

Murray: [00:15:37] a good question. I mean, I think that they are so savvy in their sporting mix already in terms of using digital and social media and. Liking e-sports and other things that I haven’t noticed. A massive change in there.

Viewership habits. You know, they weren’t the kind of people that were sitting down watching a, you know, a 90 minute soccer match or a 90 minute formula one race beforehand. And so they’re certainly not gonna sit down now and watch like a lot of the archives sports, which seem to be on, I think that.

They’re being forced to explore a little bit more and a little bit wider because there isn’t that live sort of news and results and information coming in from sports. So, you know, as I said earlier, that probably is an opportunity there for the more savvy sports people out there to be creating better connections with, uh, with a potential fan base.

Gavin: [00:16:31] How, um, as we wind down here, um, I just got a couple more questions for you. How are, how do you think the teams or the owners are going to deal with this? I mean, sport is one of those things that people are, I doubt they’re going to bail it out, right? They’re like, Boeing, okay, well we’ll bail out the airlines and that sort of stuff.

And even that is a little bit questionable. But, um, you know, how are the, how are people going to deal, like how are, how is the business of sport going to deal with this?

Murray: [00:16:59] Yeah. The people that I’ve spoken to, you know, not for starters, I should say, none of us actually know, but I think the speaker, the people I’ve spoken to over the last couple of weeks or so, I think we’re all in agreement that actually the best solution for everybody is to try and kick the can down the road a little bit.

So to extend all of the broadcast agreements and sponsorship agreements and player agreements, et cetera. For an extra year, let’s say I would certainly at least an extra six months, and in the meantime. Uh, share the pain, meaning that, you know, I’ve already heard from some sports organizations that have asked people to take a 25% salary cut for the next three months.

Or, you know, I’ve asked everybody to make sure that they take all their leave now, or in some cases, even in the very short term, you know, could they take a couple of weeks unpaid leave? And I, I suspect that, that, you know, that’s the way that we can keep everything. Uh. As close to survival as possible. Uh, but because nobody knows how long it’s going to go on for it.

It’s all very well to say that for the next couple of months. But you know, if this ends up going on for six months, how many people really will be able to survive? And I think this is where, you know, you see some of the athletes. The top professional athletes showing real leadership in terms of, you know, offering to pay workers at various arenas or, um, you know, making sure that zero contract workers are looked after because you know, they can afford to give up the, the, you know, the millions of, they’re paid in signing on bonuses and so on.

Whereas it’s the guys at the other end that suffer, but ultimately, you know, help pay those big salaries. Yeah. I don’t think there’s anybody going to be bailing out any clubs. Uh, any governments bailing out any clubs. But I think if it’s, if it doesn’t sound too controversial, I think that there’s also going to be some correction.

You know, you’ll see that actually probably some salaries after this will become a little bit more realistic at the top end. And clubs will realize what spending outside of their means. Uh, actually is because, you know, that’s the classic thing that we used to talk about a lot in the sports business about that.

If you actually looked at premier league clubs as proper businesses, all but six of them would be trading in solvent. So, you know, this is probably going to force a massive. Correction to those guys in terms of not always assuming that revenues are always going to go up and that they don’t need to have any reserves and that they don’t need to be balanced in the way that they think about things.

And I think that the people that I feel sorry for are actually, you know, clubs and leagues and players sort of should probably in that middle set where, you know. They’re, let’s call them middle of the road players or teams who have aspirations to be better and have been striving to do that. And you know, as I said earlier, a lot of that good work will be, will be wasted because there’ll be taking that sort of two steps backwards from this.

Gavin: [00:19:52] I think about some of the clubs that are owned by the fans, right? The fans are probably going to have to step up like some of the foot, the football clubs in England are owned all by the fans. And um, you know, they have the, and some of the smaller clubs like the lower divisions are, you know, are going to really, you know, really struggle cause you know, they’re not making the millions of dollars.

This is a very small number of people making the millions at the top. And the rest of them are just people that, you know, amateur sport may be something that. You know, it goes back a little bit. I really want to thank you for your time around. I’m going to definitely going to check in with you again. You know, in the weeks to come just to see how things are going.

If you want to get a hold of Murray or, well you can get ahold of them anytime you want through me because obviously we’re friends and family so I can give you Murray and I will screen it cause it’s just not everybody’s going to be able to talk to Murray. He is like high level. But if you want to follow a great Twitter account, if you’re on the Twitters at Murray Barnett and it’s spelled M.U.R. R. A Y. B. A. R. N. E. T. T. So, uh, if not, I’m going to create a Twitter list of all my friends so you guys can just follow me at Gavin McGarry and you’ll be able to find everyone there. Murray, thank you so much. I really appreciate it. And uh, stay safe over there.

Murray: [00:21:03] Yeah, stay healthy. Everyone.