Sports Illustrated employees left in limbo as publisher faces money troubles

Much of the staff of Sports Illustrated, and possibly all remaining writers and editors, received layoff notices Friday, which could spell the end of a publication that for decades was the gold standard of sports journalism.

The union of the staff tweeted Friday that it would continue to fight for the publication of the magazine but that its future is now in the hands of the magazine’s owner, Authentic Brands Group.

“This is another difficult day in what has been a difficult four years for Sports Illustrated under Arena Group (previously The Maven) stewardship,” the union said in a statement. “We are calling on ABG to ensure the continued publication of SI and allow it to serve our audience in the way it has for nearly 70 years.”

The layoffs come amid an ongoing dispute between Authentic Brands Group and the Arena Group, the two companies atop an unusual ownership structure for Sports Illustrated. ABG, which owns the brand, is a licensing company that owns the brands of celebrities such as Marilyn Monroe and Elvis Presley. Arena Group pays ABG $15 million a year for the rights to publish Sports Illustrated in print and online.

Earlier this month, the Arena Group missed a $3.75 million payment to ABG, which ABG said violated the terms of its licensing deal. An SEC filing Thursday said Arena’s publishing license was terminated.

Manoj Bhargava, the founder of 5-hour Energy, operates the Arena Group after making an investment in the company last year.

“If a company doesn’t pay me, I breach,” Jamie Salter, the CEO of ABG, said in an interview with The Post on Friday, adding that Bhargava has sought to lower the licensing fee. “He’s trying to negotiate with me and I told him to f— off. He tried to change the agreement. When you sign a deal with us, you live by the deal.”

Salter added that he could sell the license to other interested parties.

“I mean, it could be good,” he said. “I could end up with a really strong media partner.”

Salter left open the possibility that Arena Group and ABG could continue in business together. He said Arena Group still has five days to make the $3.75 million payment or the licensing agreement is terminated.

“He’s going to [pay] or we’re going to terminate him,” Salter said. “Who’s going to cry first? I ain’t going to cry.”

After this story was published, Dan Dienst, executive vice chairman of tactical opportunities for ABG, corrected Salter, saying the period to pay had passed and the license had been terminated. x

The two sides could, however, negotiate a new license, which a spokesman for Bhargava confirmed. The spokesman said those discussions are ongoing.

The back and forth between ABG and the Arena Group has left Sports Illustrated and its staffers in limbo—and the magazine in peril.

“As a result of this license revocation, we will be laying off staff that work on the SI brand,” the Friday morning note to staff read, adding that some employees would be terminated immediately while others would work through the end of a 90-day notice period.

Sports Illustrated has around 80 employees in its bargaining unit.

Following the morning email, staffers received further instructions from the Arena Group. A handful were told that their last day was Friday, though most staffers were asked to work for another 90 days, after which their jobs would be eliminated. Still, in those meetings, Arena Group executives left open the possibility that those jobs could be saved if ABG reached a settlement with Arena Group and returned the publishing license.

Sports Illustrated was launched in 1954 by Henry Luce as part of the Time empire. Its striking color photographs and expansive long-form journalism quickly made it the most important sports publication in the country. Weekly issues of SI, with stories from writers like Dan Jenkins, Frank Deford and Gary Smith, were appointment reading for generations of sports fans and redefined the idea of sports journalism.

Along with the rest of Time’s titles, though, Sports Illustrated struggled to adjust to the internet era. Its website has been famously stodgy, and the 24-7 news cycle was not suited to weekly sports coverage. Multiple rounds of layoffs have hollowed out the publication. Late last year, Sports Illustrated was accused of publishing product reviews under fake author names, potentially created by artificial intelligence.

Ross Levinsohn, a former executive at SI who was fired by Bhargava, announced Friday on LinkedIn that he was resigning from the Arena Group’s board because of the layoffs. “To watch in horror what is transpiring now is one of the most disappointing things [I]’ve ever witnessed in my professional life,” he wrote.

Time Inc. sold all of its magazines titles, including Sports Illustrated, to Meredith Corporation in 2018, which sold SI the next year for $115 million to ABG. When ABG bought Sports Illustrated, more than 30 percent of the staff was laid off. ABG has sought to monetize the SI brand with planned resorts and casinos.

“SI is going really well, as far as the business goes,” Salter said. “The brand is going incredibly well. I wish [Bhargava] didn’t do the s— he’s doing now, but you can’t get mad at a guy for restructuring a business to make it lots of money.”

Sports Illustrated is one of a number of sports outlets to lay off staff in recent years, including ESPN, Yahoo, the Athletic, SB Nation and countless local newspapers. HBO’s Real Sports, a pillar of TV sports journalism, ended its nearly 30-year run in December.

“It’s like Coca-Cola or Kleenex or Ford,” said Rick Telander, who wrote for SI for more than two decades. “Sports Illustrated was just absolutely iconic. I have an overall sense of time marching on into the new world, and hoping it isn’t a harbinger of all mass print journalism. I’m hoping that this was just terrible management, which it seems like it was.”

He added: “It’s sad for me. It relegates to the scrap heap all the things we did, all my friends. It’s just depressing.”