One good thing for the players is that the PGA purses might rise. Like all businesses, it will come down to who will fund it.
I'm a little more skeptical than you in thinking PGA purses might rise of any substance, but maybe some of my assumptions below are wrong.
This is not a typical business - let's say the Saudi's decided to create a new football league. The existing owners of the NFL could agree to raise salaries to combat this, and accept the additional initial loss in return that comes with that for the future good of the league. The PGA tour members own the tour as an NPO - it can't take on losses like this to face a challenge. Instead they rely on business partners who will invest more in a product that is stable or on the upswing.
Overall my views are based on the following key assumptions - if you disagree with these, or view these as incorrect (which is fine) than it changes one's assessment.
- The PGA tour has already lost some players to LIV, and will continue to lose at least a few more.
- The quality of field at PGA events will decline to some degree. Whether its not that huge or significant is still TBD. But the field quality will go down. It has already been an issue for many events before LIV even existed -- increasing the PGA tour to 48 events has already stretched the talent thin for some events.
- Opposite field LIV events will take away some eyeballs from some weak opposite field events, but this could well be a minimal factor..
- Top PGA players are not going to play more events to strengthen the events overall. If anything they are probably looking at a "Play Less for More Scenario", and this can't be attractive to business partners of the PGA Tour.
- Corporate Sponsors or TV Partners are looking for return on investments, Weaker fields do worry them, and they are not going to pay more as the fields decline a bit -- unless they feel they have some obligation to help the PGA combat this.
- LIV vs PGA won't bring in extra eyeballs to PGA Events, other than majors.. Majors will get even more interest vs regular events now, which hurts regular events.
- While the PGA will be better than the LIV, their product will inevitably decline a bit even if they crush LIV.
I see the PGA has having the following 4 ways to increase purses.
1) Corporate Sponsors - With weaker fields, and also with the general business environment, will Corporate Sponsors be willing to pay more than they initially wanted to?
2) TV Rights - Weaker fields also has to a big concern for them. TV rights will go up because they always somehow do, but I think the rate of the increase will be lower due to field issues.
3) Taking money from PGA Tour Reserves - The PGA Tour has a fair amount of reserves that it has created as an NPO... profits stashed as reserves, but that can only be a temporary solution and may also threaten their charity status.
4) Increasing Purse Sizes and telling the Charitable Foundations that run events to figure it out themselves (passing risk onto charities which they have already done at times)
As I said PGA will be better than LIV, probably far better - but even in beating them I'm not sure how their product will not take some hit.
Now I do think their are some innovative ways that could increase revenues for the top of the tour but that could involve the mid-card and low-card players of the tour taking a hit. But that would likely create an ugly internal war. In a post the other day, I was thinking the PGA could create high purse small field "Super League" events, where they bring in annual "relegation" and "promotion" - would be different than the playoffs. Or they give higher %'s to the top 10 of events.
