Sport will recover from Covid-19 shock but time will tell just how many stitches it needs

Kevin Moore, Managing Director at Legacy Communications

Originally published in Sunday Independent and Independent.ie March 15 2020

Despite what the legendary Liverpool manager Bill Shankly once claimed, it is times like this when sport and all other forms of entertainment are firmly put into context. What originated as a virus strain in China in December has steadily spread and become a worldwide issue.

‘Football is not a matter of life and death, it’s much more important than that’ – Bill Shankly.

The past week has proved to be a seminal one, with the World Health Organisation declaring Covid-19 a global pandemic on Wednesday. Italy, one of the worst affected regions, saw its virus death toll surge by 30 per cent to more than 800 on the same day. US President Donald Trump quickly followed with the announcement that travel to and from the majority of Europe would be suspended.

It has also proved to be a seminal week in Ireland. On Monday the St Patrick’s Day Parade was cancelled. On Wednesday Ireland recorded its first Covid-19 related death and on Thursday the Irish government and medical leaders announced a series of stringent measures to try to control the spread of the virus. All schools, colleges and childcare centres are closed for at least two weeks and all indoor gatherings of more than 100 people and outdoor events involving more than 500 people are recommended to be cancelled.

All week, conversations, social media and traditional media platforms were dominated by Covid-19 and its impact from both a health and economic perspective. Sport was not long in entering the conversation. While Shankly was a little off the mark with his statement, the power of sport in society globally cannot be overstated.

Earlier in the week basketball superstar, LeBron James, claimed he would refuse to play if the Los Angeles Lakers games were held behind closed doors, a stance that he soon backed down from.’

It’s far too early to give a sense of the scale, but it is safe to say that Covid-19 will impact on all businesses and industries in some shape or form. Sport is responsible for most of society’s most regular and widespread mass gatherings and it looks like 2020 will be a year that packs a punch to its bottom line.

Now believed to have surpassed the $500 billion mark, sport is one of the fastest growing industries globally. It will survive, it will recover, but time will tell just how many stitches it needs.

The epidemic threw Chinese sport into disarray at the turn of the year and as it stands, most football leagues around Asia have been postponed indefinitely. Images of Ronaldo celebrating with his teammates in an empty stadium last week as Juventus beat Inter Milan revealed the stark reality of what was to follow in Italy and across Europe.

A study conducted by Calcio e Finanza’, an Italian website specialised in soccer finance, estimates that playing behind closed doors would result in a loss in the region of $34m (€30.5m).

Earlier in the week basketball superstar, LeBron James, claimed he would refuse to play if the Los Angeles Lakers games were held behind closed doors, a stance that he soon backed down from as the gravity of the situation heightened.

Talk of empty stadia and closed doors have now turned to postponements of matches, leagues, and competitions across a host of sports globally. The UK’s biggest racing festival in Cheltenham, however, did not seem to get the memo and averaged almost 60,000 attendance per day. As each day of the Festival passed, the decision to open the doors seemed more and more irresponsible.

Football’s richest league, the Premier League, generates over 70 per cent more revenue than its nearest competitor, the Bundesliga. So, it may not be a surprise that they stalled in adopting an empty stadium policy. On Friday an emergency club meeting was held in the wake of both Arsenal head coach Mikel Arteta and Chelsea player Callum Hudson-Odoi testing positive for Covid-19. The decision was made to suspend Premier League fixtures until April 3, while next week’s Champions League and draw have been postponed.

Ireland faced its first significant virus-related economic hit when its Six Nations match against Italy on March 7 was called off, resulting in a financial blow for the IRFU, the Aviva Stadium and the Irish economy. Most key sporting fixtures in Ireland took place over the past couple of weeks as authorities monitored the situation.

On Wednesday, Basketball Ireland took what could have been perceived as a rash decision to suspend all basketball related activity until further notice due to the virus. In reality though, they were one step ahead as 24 hours later all major sporting authorities in Ireland began to follow suit. The Allianz GAA Leagues, the Guinness Pro14 amongst others . . . all postponed.

The financial impact of the fanless matches and postponements is significant. Like most businesses trying to cope with Covid-19, it will hurt. Loss of income through gate receipts, loss of tv revenue and loss of opportunity for sponsors.

The wider loss of income to the Irish economy from packed stadia in March and April is a big blow. The Italy v Ireland fixture and the Pro14 derby between Leinster and Munster along with the Allianz League football and hurling finals, for example, would run into the tens of millions combined.

It’s not the first time in the sporting world that unforeseen events have thrown sport into disarray and it won’t be the last. Natural disasters as recent as the bush fires in Australia last year and an earthquake in Japan in 2016 resulted in the cancellation of sporting fixtures and with it millions of dollars worth of income. The SARS outbreak in China in 2003 led to the Women’s World Cup being moved to the US. Closer to home, the foot and mouth outbreak played havoc with the Irish economy and sporting fixtures in 2001.

However, this scale of sports disruption across the world has not been seen since World War II. As an industry, sport is well equipped to deal with any short-term pain. Short-term means events are postponed rather than cancelled. Revenue is delayed rather than lost. Leagues and annual competitions will adjust. Sponsors will find innovative ways to respond. Fans will attend and watch sport as soon as it returns.

It is the larger global events that are more complex. UEFA took an innovative step to spread this year’s European Championships across the continent, hosting the event in 12 countries, including Ireland. This plan to spread the tournament throughout Europe has collided with the spread of Coronavirus. The championships now look set to be postponed until 2021, according to L’Equipe. As one of the host nations, Ireland will have to deal with the fall-out of such a postponement and with it the financial and tourism repercussions.

One question on many sports fans’ minds is around the biggest event of them all, the Olympics, set to be staged in Japan in late July. Cancelling the Olympics is unthinkable. As it stands, time is on its side.

The more action that is taken now by governments and sports authorities around the world, the greater chance there is of curtailing the spread and therefore limiting the pain.