“The whole thing never made commercial sense to me,” remarks Paul McGinley in getting straight to the point of the unravelling of LIV Golf’s business model.
His comments come after confirmation the upstart league’s financial backers – Saudi Arabia’s Public Investment Fund (PIF) – have decided to walk away from the venture at the end of the season.
Rather appropriately, McGinley is seated in a plush leather armchair beneath an ornate ceiling in the Gold Room at Carton House – the Maynooth resort where the OFX Irish Legends tournament will take place in the summer – as his business brain accesses the paths various LIV players will take in light of the revelations.
McGinley – who also has degrees in marketing and business – wonders how the LIV experiment managed to survive so long, having launched in 2022 and costing the Saudis an estimated $5 billion.
“I’ve been on the hamster wheel of golf,” says McGinley. “From being a player, a Ryder Cup player, a Ryder Cup captain, to being on the board for six years while LIV was being launched. Now I’m on the Ryder Cup advisory board and also in the media, so I can see it from all different angles.
“From day one the bit that I know about golf and the commercial side of golf, is the business model never made any sense. Because everything has to be sustainable.”
LIV’s arrival on the professional scene – with Jon Rahm, Bryson DeChambeau and Phil Mickelson among those to fill their wheelbarrows with greenbacks – also impacted the PGA Tour and the DP World Tour. This week’s Cadillac Championship, a $20 million signature event on the PGA Tour, is a case in point on how the landscape of the sport changed and money talked.
“It has left the game, in my view, in a very difficult and potentially unsustainable place. The overheads and prize funds now are so huge because of LIV that the tours are under pressure. Everybody else loses, except the players.
“The tours lose, they’ve got massive overheads. The public lose, because they’re seeing a diluted product on TV, and are having to pay a lot more money to go to events now. The sponsors lose because they’re having to spend a lot more money to sponsor the same events. The media companies lose because TV numbers are not huge. So, tell me anybody who’s winning except the players here.”
A Mexican Catrina in front of a poster featuring LIV golfers ahead of LIV Golf Mexico City at Club de Golf Chapultepec earlier this month. Photograph: Hector Vivas/Getty Images
With this season set to be the last for LIV – at least under the PIF funding model – there will need to be another reset for men’s professional golf. The PGA Tour and DP World Tour will have to consider a route back for players who defected in addition to assessing their own models for the future.
As McGinley puts it: “The legacy that LIV will have left professional golf is not a positive one for the administration. The tours are not in a better place because of LIV. The players are in a better place, they’re a lot more financially lucrative than they were, but the tours are not in a better place.
“It will be interesting to see how they’re going to reset themselves. Does it mean a smaller tour? Does it mean less events? Does it mean less prize money? I don’t know, but something will have to give in order to bring it back to levels of sustainability, [because] at the moment it’s creaking to pay the bills on.”
One thing McGinley believes is certain is that Rahm & Co will find a way back, the way already set by Patrick Reed and Brooks Koepka, although a level of fairness must be achieved as part of any such returns.
“If there’s going to be pathways, how’s that going to be? Will the DP World Tour benefit, will it not? What happens to players who remained loyal? All the players who went to LIV, their spots have been filled. You’ve got to be fair to those guys who stayed.
“But the guys who went to LIV win as well. They’re coming back with tens and sometimes hundreds of millions of dollars in their back pocket, so it’s hard to feel sorry for them.”
*McGinley was speaking at the launch of the OFX Irish Legends tournament – part of the Staysure Legends Tour – which takes place at Carton House, Co Kildare on July 10th-12th