Sports Business: Golf
Tiger vs. the PGA: How Serious Is It?
The PGA Tour will soon renegotiate TV rights, and Woods may want a cut
As ideas go, it's about as revolutionary as shrinking the golf ball or making the hole twice as big. Tiger Woods is telling the world that he's entitled to a chunk of the PGA Tour's next television contract.
The Tour is nearing the end of a four-year, $650 million pact with CBS, NBC, and ABC, and all signs point to a huge increase in the value of the next deal, thanks to the new eyeballs Woods has brought to golf on TV. This year, audiences for tournaments Tiger played in were 105% higher than those Tiger skipped. Heady numbers, and they explain why golf's power brokers are taking very seriously a wide-ranging, sometimes pouty Woods interview in the current issue of Golf World. He complains about the tour misusing his image in advertisements, about burdensome fees that the agency representing him must pay to the Tour when it stages independent golf tournaments, even about feeling unappreciated by PGA Commissioner Tim Finchem.
Is he deserving enough to be handed a piece of the TV pie? "Philosophically? I would be. Arnold [Palmer] would be. All the great ones would be," Woods told the magazine. Yet how determined he is to fight for a cut of Tour revenues remains an open question. So far, Woods and his agent, IMG's Mark Steinberg, have couched such talk in terms of what should be rather than what will be. Steinberg declined to be interviewed.NO COMMENT. Not all in the Woods camp have been as closed-mouth, though. Earl Woods, Tiger's dad, has said that his son doesn't need the Tour and that, if his concerns aren't addressed, he could end up playing golf far from the PGA. After placing eighth in the Tour's season-ending American Express Championship in Spain on Nov. 12, Woods had nothing to say except that he would be meeting soon with Finchem and his staff.
Tiger's fellow players and their agents have reacted cautiously--and not always negatively--to his claim on TV money. That's a surprise when you consider that for every TV dollar siphoned off by Woods, one less dollar is available to the rest of the PGA Tour in prize money and other forms of compensation. "My first reaction is that it's not a reasonable request," says Jim Lehman, a Minneapolis-based agent for about two dozen pro golfers, including his brother Tom, a top-echelon player. "I might have a different opinion if I understood where he was coming from. But it seems to me that Tiger already is being significantly compensated by increased purses and by his success on the golf course."FORCE OF NATURE. Veteran Tour pro Fred Couples says he is keeping an open mind about all things Tiger, including his bid for TV dollars. "I can't be one of those [talk-show] callers complaining: `Who does he think he is? He's already making $80 million--and he wants more?"' says Couples. "Tiger Woods is making us all a lot more money." If paying Woods a percentage of the PGA Tour's television revenues was the only way to keep Tiger content, Couples says, "Write the check tomorrow." It may not be that simple. Golf observers say the Tour would be courting a compensation free-for-all if it used its TV revenues to reward one player--even in the case of Woods, the world's best.
No doubt about it, Tiger was a force of nature this season: He racked up nine victories and a record $9 million in tournament earnings. In perhaps his most amazing display of consistency, he shot par or better in every round he played from the middle of May forward. But even superstars get the blahs. What if Tiger fell to earth next season and was challenged or surpassed by another young player, like Spain's Sergio Garcia or South Africa's Ernie Els. Wouldn't they be in line for a cut, too?
"I don't see it happening. I don't see the PGA Tour agreeing to it," says Neal Pilson, former president of CBS Sports. Moreover, Pilson isn't sure Woods can justify the special treatment. "It's the old story: No one's interested in seeing the Dallas Cowboys or the New York Giants practice--they have to compete against other teams," he says. "Tiger's value is only a function of his competition with other players. I don't think he seriously believes that if he went out and played a round by himself he'd be able to secure a huge TV rights fee."
Because Tiger is Tiger, he'll get a hearing from Tour officials and is likely to win concessions on some of the less contentious issues he has raised. For example, Finchem might quickly compromise on the Tour's policy of extracting fees from the promoters of made-for-TV golf. It's a sore point for Woods because he's often the star attraction at events such as this year's Battle at Bighorn, in which he went head-to-head with Garcia. For certain, Woods is also sounding off on behalf of IMG, the powerful sports marketing and representation outfit that promoted the Bighorn match and bristled at having to pay the PGA Tour a fee of over $1.5 million.
Other changes may be in order, too. Many tour players support Woods in his campaign to force the Tour to stop using their photos in tournament advertising without permission. (Woods, who has an endorsement deal with financial services giant American Express Co., has complained about being shown in an ad touting his victory in an event sponsored by Pricewaterhouse Coopers LLC.)HARD AND FAST. But Tiger may find the PGA Tour unyielding on other policies. Among those more entrenched rules is the one that limits pro golfers to three "releases" for every 15 tour events they enter. Releases are passes to play in tournaments around the world that conflict with PGA events. Australian Greg Norman, who preceded Woods as golf's top dog, attacked the rule and derided Finchem for standing by it. But Norman never changed it.
And if Tiger ever did act on Daddy Woods' threat and walked, where would he be walking to? "All he could do is retire, which I see occurring sooner rather than later," says Pilson. "He's had so much success at a young age...you begin to look for other things to do in life."
Other observers see options for Tiger, though none that would have him playing to larger audiences or honing his skills against the world's best. Woods' Asian heritage (his mother is Thai) has made him enormously popular in the Far East, but it's hard to imagine Tiger chucking the PGA Tour for full-time duty on the Asian Tour. The European Tour also beckons, but could Tiger truly find happiness as the shotmeister of the annual Peugeot Open de Espana?
Were he to exit the PGA Tour, the most attractive choice might be--the PGA Tour. Tiger could play in the U.S. part-time on the eight or nine sponsors' exemptions he would be permitted each year, plus golf's four major championships that don't count against that number. He could fill the rest of his dance card with international events.
That would be a nightmare for the PGA Tour. Tiger's popularity and impact on ratings have been so profound that, at times, he overshadows the tournaments in which he is playing. The Golf Channel (TGC), a network partly owned by Palmer, revealed the power of Tiger last August. Instead of showing the opening round of a tournament in Michigan, TGC opted for coverage of Woods' entire first round--on tape. The PGA Tour fumed over having been pre-empted by one of its own. And TGC led off its live coverage the next day with an apology. "It's easy to get caught up in the Tiger Effect," says David Manougian, COO of The Golf Channel.
Whether or not he defects, the specter of a Tour without Woods could weaken the PGA Tour's bargaining position when contract talks with the networks get started next spring. Uncertainty about Tiger's future, if it is still an issue, could have a chilling effect on demands for an enormous payday. Couples hopes any hard feelings and power plays are resolved long before then. "He's bringing the tour gravy. He's making every tournament he plays in a lot stronger and a lot better," says Couples. Right now, only one thing is certain: As the dispute plays out, all eyes will be on Woods. Nothing new about that.By Mark HymanReturn to top