FOX, the USGA and the 12-Year Deal

Golf Digest posted a very interesting article by Ron Sirak called TV's $1.1 Billion Problem: Making Sense of Fox and the USGA. I'm giving you this link today because this is an enlightening article about the 12-year broadcast deal between FOX and the USGA and the unexpected problems both have come up against.



Starting in the second paragraph you'll find this:

According to sources familiar with the situation, tensions between the USGA and Fox increased after the network's aggressive handling of rules controversies at the 2016 U.S. Open and the U.S. Women's Open. There was also significant dissatisfaction within the USGA, sources say, over the fact that Fox and its cable arm Fox Sports 1 (FS1) did not take advantage of a West Coast venue for the Women's Open to push the broadcast deep into East Coast prime time, bringing the women's game much-needed exposure.

The USGA and Fox are saying the right things publicly, but they both acknowledge there have been conversations after 2016's major championships to settle differences. And both sides shot down whispers that they wouldn't mind an early end to the deal, which has 10 more years to run.

This very detailed article then goes on to explain the various "situations" that have arisen over the first couple years concerning the deal, which helps you understand why TV golf is such a difficult sell to many of the networks. It also looks at how event streaming may be affecting TV viewership, and how contracts with -- and proven viewership of -- other sports may be affecting golf broadcasts.

I was impressed with how clearly these issues were explained; Ron Sirak did an exceptional job on this piece. It's a post that dedicated golf fans should read, simply so they will be better informed about the issues that efforts to "grow the game" will face going forward, both in terms of who is watching and what other options they may be choosing instead.

And it just may help you appreciate exactly what Arnold Palmer and Joe Gibbs managed to accomplish when they started GC. We are very lucky, folks.

Acushnet's IPO Is a Mixed Bag

Acushnet -- that's Titleist and FootJoy, in case you didn't know -- went public on the stock market Friday. According to the reports, the results were mixed.



The Golf Digest report said this:

The initial offering price was $17 per share with just under 20 million shares of common stock to be sold by existing shareholders of Acushnet, which was bought by Fila Korea and a consortium of Korean banks in 2011. The underwriters have a 30-day over-allotment option to purchase up to an additional 2.9 million shares. J.P. Morgan and Morgan Stanley are lead book-running managers and representatives of the underwriters for the initial public offering. The offering is expected to close on Nov. 2.

The first day of trading saw a little more than 6.9 million shares change hands with a day’s range of $16.90 and $18.00. At the close of trading the stock was at $17.95.

Now whether that's good or not depends on who you talk to. Fortune's report called it "Par—with a substantial handicap." CNN Money's article was less kind; their summary was entitled "Shanked! Titleist IPO lands in the rough" and their article concluded by saying "At best, the stock is a double-bogey."

Of course, given the number of recent IPOs that have opened very high and then fell, sometimes dramatically -- for example, Forbes called last year's Twitter IPO a failure -- I'm not sure Acushnet did so bad. Initial estimates called for the stock to open at $21-24; imagine the outcry if it had sold for that and THEN fell! At least the stock hadn't lost anything by the end of the session.

What I found most interesting in the articles mentioned above -- especially the Golf Digest piece -- was probably lost on most of those buying stock. Acushnet's COO David Maher, who's been with the company for 25 years, said that he believes the USGA, R&A and the golf equipment companies are largely on the same page now, and that most of the "imbalances" in the golf equipment businesses (he's talking about overstock and making too much new equipment too soon for the market) have been corrected. He says Acushnet isn't worried about the slow first day because they're in this for the long haul.

Given that Acushnet has been around since the 1930s and has managed to stay afloat through some pretty bad times, I find it hard to be all that pessimistic about their first day. Time will tell, I guess.

But if you're interested in watching Acushnet's progress, its trading symbol is GOLF. What else?

Early Reports Say Dick's Bought Golfsmith

Granted, we don't know all the details for sure yet, because this comes from those nameless "sources" who provide early info. But Reuters is certain enough that they put the word out late Friday.

It looks like Dick's Sporting Goods is going to buy Golfsmith.



I've been scanning the net for details, and here's the best I can do at this point.

There was an auction for the chain last Wednesday, which Dick's won, although the US Bankruptcy Courts still have to approve it.

Supposedly the deal included all the stores, the inventory and the intellectual property. Intellectual property includes all the printed materials (instructional and otherwise) that Golfsmith made available to the public.

The belief is that Dick's will keep about 30 of the stores open and close the rest, but nobody knows yet whether they'll be rebranded as Dick's stores, Golf Galaxy stores (which Dick's also owns), remain as Golfsmith stores, or there could be some other arrangement. But a Golf Digest article about the sale says it would likely give Dick's "the largest collection of golf retail stores in the country. It currently operates 72 Golf Galaxy stores and adding the 30 Golfsmith stores would give it 102, compared to Worldwide Golf Shops 72 stores." The article adds that Worldwide was the other major bidder in the auction.

What does that mean for the rest of us? Well, unless Dick's removes the golf departments from its regular stores -- which I suspect is unlikely, given that a Dick's golf department employee told me several months ago that Dick's is training its own golf techs now -- your next set of clubs will most likely come from a Worldwide or Dick's-owned golf store.

At least, they will if you want to have your clubs custom-fitted.