Mass Layoffs, Chaos At ‘Sports Illustrated’ Spark Journalists’ Rebellion
Updated at 6:30 p.m. ET
The revered 65-year-old Sports Illustrated magazine is in a state of bedlam.
In meetings Thursday afternoon, managers told staff members that about half the newsroom would be laid off, according to two people present at the meetings.
Sports Illustrated was in chaos Thursday amid word of massive layoffs at the 65-year-old magazine.
Mark Lennihan/AP
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Mark Lennihan/AP
NPR obtained a petition signed by approximately three-quarters of Sports Illustrated‘s journalists asking its new owners not to deliver control of the publication to a digital publisher named TheMaven network.
“TheMaven wants to replace top journalists in the industry with a network of Maven freelancers and bloggers, while reducing or eliminating departments that have ensured that the stories we publish and produce meet the highest standards,” the petition reads. “These plans significantly undermine our journalistic integrity, damage the reputation of this long-standing brand and negatively [affect] the economic stability of the publication.”
The new controlling executives include Ross Levinsohn, the controversial former Los Angeles Times CEO. The plan as described in the journalists’ petition appears to echo an earlier strategy by Levinsohn, who was appointed by Maven. As publisher of the Los Angeles Times and an investor in a digital outfit called True/Slant, Levinsohn embraced a strategy he termed “gravitas with scale” — a model that was based in part on unpaid contributors and meant job losses for the traditional newsroom journalists in the Tribune publishing chain.
Levinsohn and his frequent business partner James Heckman, the founder of Maven, were the subject of an earlier investigative report by NPR over their business practices. Levinsohn, Heckman and several associates met with the newsroom Thursday afternoon.
Today was my last at Sports Illustrated as NBA editor. It was a longtime dream to contribute to this brand and I enjoyed (almost) every day of my four years here. Working alongside this level of talent was truly an honor. I’ll be on the lookout for what’s next. DMs are open.
— DeAntae Prince (@DeAntae) October 3, 2019
After six years at @SInow, it’s over. I can’t begin to articulate the fun I had covering damn near everything: the College Football Playoff, Super Bowl, Masters, Stanley Cup, World Series.
This industry can be heartbreaking, but I don’t want out. If you’re hiring, I’m all ears.
— Joan Niesen (@JoanNiesen) October 3, 2019
The uncertainty surrounding the magazine’s status had caused chaos for the newsroom over the previous 24 hours. Meetings that had been scheduled for midday Thursday were called off minutes before they were due to begin. On recordings heard by NPR, the magazine’s editors apologized for the uncertainty.
“We’re pushing to find out as much information as we can,” Steve Cannella, promoted just this week to be co-editor in chief, said in brief remarks to the newsroom, according to audio tapes reviewed by NPR and verified by two people present. “We know exactly how hard this is for you guys. We know the strain this is on the entire newsroom. We know that lives are at stake.”
“That’s all we can say right now. We’re really, really sorry. And you have as much information as we do,” Cannella says, on the recording. “The anger, I understand it. I’d also be angry. We just ask for a little bit of patience as we try to find out what’s going on.”
Until the meeting with Maven executives, the question of who controls the magazine had not been clear, as it has been subject to a series of major transactions in a short period of time: Meredith Corp. bought SI last year along with other Time Inc. titles and then sold the magazine in late May 2019 to a brand and marketing firm called Authentic Brands Group. Meredith, a major magazine publisher, was set to operate Sports Illustrated for two years. Several weeks later, in June, Authentic Brands struck a licensing deal cutting Meredith’s involvement short and giving Maven the right to operate the publication for up to 100 years. But that deal was only finalized on Thursday.
Meredith confirmed to NPR that Authentic Brands finished the transfer of editorial control of Sports Illustrated to Maven from Meredith, its formal owner. According to Meredith, the layoffs it announced were conducted at Maven’s behest.
“As the new licensor of … Sports Illustrated, Maven made the Sports Illustrated personnel decisions that Meredith communicated to the SI employees today,” Meredith said in a statement. “Going forward, the remaining SI employees will work at the direction and at the pleasure of Maven.”
NPR is seeking comment from Authentic Brands and Maven.
Targeting ‘Medicare For All’ Proposals, Trump Lays Out His Vision For Medicare
President Trump greets supporters after arriving at Florida’s Ocala International Airport on Thursday to give a speech on health care at The Villages retirement community. In his speech, Trump gave seniors a pep talk about what he wants to do for Medicare, contrasting it with plans of his Democratic rivals.
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Evan Vucci/AP
Updated at 4:30 p.m. ET
President Trump gave a speech and signed an executive order on health care Thursday, casting the “Medicare for All” proposals from his Democratic rivals as harmful to seniors.
His speech, which had been billed as a policy discussion, had the tone of a campaign rally. Trump spoke from The Villages, a huge retirement community in Florida outside Orlando, a deep-red part of a key swing state.
His speech was marked by cheers, standing ovations and intermittent chants of “four more years” by an audience of mostly seniors.
Trump spoke extensively about his administration’s health care achievements and goals, as well as the health policy proposals of Democratic presidential candidates, which he characterized as socialism.
The executive order he signed had previously been titled “Protecting Medicare From Socialist Destruction” on the White House schedule but has since been renamed “Protecting and Improving Medicare for Our Nation’s Seniors.”
“In my campaign for president, I made you a sacred pledge that I would strengthen, protect and defend Medicare for all of our senior citizens,” Trump told the audience. “Today I’ll sign a very historic executive order that does exactly that — we are making your Medicare even better, and … it will never be taken away from you. We’re not letting anyone get close.”
The order is intended, in part, to shore up Medicare Advantage, an alternative to traditional Medicare that’s administered by private insurers. That program has been growing in popularity, and this year, premiums are down and plan choices are up.
The executive order directs the Department of Health and Human Services to develop proposals to improve several aspects of Medicare, including expanding plan options for seniors, encouraging innovative plan designs and payment models and improving the enrollment process to make it easier for seniors to choose plans.
The order includes a grab bag of proposals, including removing regulations “that create inefficiencies or otherwise undermine patient outcomes”; combating waste, fraud and abuse in the program; and streamlining access to “innovative products” such as new treatments and medical devices.
The president outlined very little specific policy in his speech in Florida. Instead, he attacked Democratic rivals and portrayed their proposals as threatening to seniors.
“Leading Democrats have pledged to give free health care to illegal immigrants,” Trump said, referring to a moment from the first Democratic presidential debate in which all the candidates onstage raised their hands in support of health care for undocumented migrants. “I will never allow these politicians to steal your health care and give it away to illegal aliens.”
Health care is a major issue for voters and is one that has dominated the presidential campaign on the Democratic side. In the most recent debate, candidates spent the first hour hashing out and defending various health care proposals and visions. The major divide is between a Medicare for All system — supported by only two candidates, Sen. Bernie Sanders and Sen. Elizabeth Warren — and a public option supported by the rest of the field.
Trump brushed those distinctions aside. “Every major Democrat in Washington has backed a massive government health care takeover that would totally obliterate Medicare,” he said. “These Democratic policy proposals … may go by different names, whether it’s single payer or the so-called public option, but they’re all based on the totally same terrible idea: They want to raid Medicare to fund a thing called socialism.”
Toward the end of the speech, he highlighted efforts that his administration has made to lower drug prices and then suggested that drugmakers were helping with the impeachment inquiry in the House of Representatives. “They’re very powerful,” Trump said. “I wouldn’t be surprised if … it was from some of these industries, like pharmaceuticals, that we take on.”
Drawing battle lines through Medicare may be a savvy campaign move on Trump’s part.
Medicare is extremely popular. People who have it like it, and people who don’t have it think it’s a good thing too. A recent poll by the Kaiser Family Foundation found that more than 8 in 10 Democrats, independents and Republicans think of Medicare favorably.
Trump came into office promising to dismantle the Affordable Care Act and replace it with something better. Those efforts failed, and the administration has struggled to get substantive policy changes on health care.
On Thursday, administration officials emphasized a number of its recent health care policy moves.
“[Trump’s] vision for a healthier America is much wider than a narrow focus on the Affordable Care Act,” said Joe Grogan, director of the White House’s Domestic Policy Council, at a press briefing earlier.
The secretary of health and human services, Alex Azar, said at that briefing that this was “the most comprehensive vision for health care that I can recall any president putting forth.”
He highlighted a range of actions that the administration has taken, from a push on price transparency in health care, to a plan to end the HIV epidemic, to more generic-drug approvals. Azar described these things as part of a framework to make health care more affordable, deliver better value and tackle “impassable health challenges.”
Without a big health care reform bill, the administration is positioning itself as a protector of what exists now — particularly Medicare.
“Today’s executive order particularly reflects the importance the president places on protecting what worked in our system and fixing what’s broken,” Azar said. “Sixty million Americans are on traditional Medicare or Medicare Advantage. They like what they have, so the president is going to protect it.”
As Pressure From Regulators Increases, Juul Shifts Its Strategy
The vaping company Juul is under intense pressure from regulators and politicians. It’s spending more on lobbying, public relations and grassroots campaigns to stir up opposition to new vaping laws.
MICHEL MARTIN, HOST:
The vaping company Juul Labs finds itself under siege by politicians, regulators and doctors. It’s happening amid reports that a dozen people have died after using vaping products, and hundreds of others have become ill from products related to vaping. As efforts to regulate the industry have increased, Juul has poured millions of dollars into lobbying and public relations campaigns. NPR’s Jim Zarroli has this report.
JIM ZARROLI, BYLINE: Juul was founded four years ago, promising it could help smokers quit. And it quickly became a vaping powerhouse. At first, the company faced hardly any regulation, and it had to spend very little money on lobbying – just $120,000 in 2017. But as efforts to regulate vaping have intensified, Juul has ramped up its lobbying. Sheila Krumholz of the Center for Responsive Politics says the company spent nearly $2 million in the first six months of this year alone.
SHEILA KRUMHOLZ: As a new company, it’s striking how much they’re spending in just a very short period of time.
ZARROLI: Among tobacco companies, only Philip Morris and Altria spend more on lobbying. Meredith McGehee, executive director of the campaign finance reform group Issue One, says the money helps Juul get in the door to speak to regulators and lawmakers.
MEREDITH MCGEHEE: They’re out there trying to convince people that Juul is a good alternative to smoking, and they want to be able to go in, get in front of policymakers and make that case.
ZARROLI: And that’s just what Juul spends at the federal level. As the tobacco executives who now run Juul know all too well, many anti-tobacco laws have originated in cities and states, and Juul has hired dozens of lobbyists in statehouses and city halls across the country. Denise Roth Barber directs the National Institute on Money in State Politics.
DENISE ROTH BARBER: They spend copious amounts of money lobbying the lawmakers who get elected. And that’s where the rubber really hits the road, and they are swarming the capitals in a way that regular citizens are not.
ZARROLI: And this doesn’t include expenditures the company doesn’t have to disclose, like the money paid to public relations firms or to independent groups that may support its agenda. For example, Juul’s website contains links to the Switch network. It helps members of the public find a pro-vaping rally to attend or write a letter to their members of Congress. Stanford’s Robert Jackler researches the impact of tobacco advertising.
ROBERT JACKLER: It sounds as though it’s an upswelling of the population, but it’s actually driven by the company to simulate it, make it look like it’s something that came from the grassroots amongst the voters.
ZARROLI: But it’s not clear how well any of this will work. Although it’s not known what exactly is causing the lung illnesses, Jackler says concerns about vaping are growing.
JACKLER: This recent rash of acute and very serious and sometimes lethal e-cigarette-related illnesses in the lung have very much focused and changed the national dialogue.
ZARROLI: As criticism has mounted, Juul has agreed to stop advertising in the United States and has fired its CEO. It’s also promised not to lobby against a proposed Trump administration ban on flavored vaping products. But the company is still hoping to push back against other proposed anti-vaping regulations, and that seems to be getting harder to do as time goes on.
Jim Zarroli, NPR News, New York.
(SOUNDBITE OF ANNIE’S “ANTHONIO”)
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NPR transcripts are created on a rush deadline by Verb8tm, Inc., an NPR contractor, and produced using a proprietary transcription process developed with NPR. This text may not be in its final form and may be updated or revised in the future. Accuracy and availability may vary. The authoritative record of NPR’s programming is the audio record.
‘Los Angeles Times’ Investigation Shows How Vaping Crisis Could Have Been Prevented
NPR’s Michel Martin speaks with Los Angeles Times reporter Emily Baumgaertner about how the FDA tried banning vaping flavors, but the Obama administration rejected it.
MICHEL MARTIN, HOST:
Every day now, it seems we hear doctors warning about vaping, particularly among young people, and governments weighing bans on vape products. A Los Angeles Times investigation now makes clear this crisis could have been prevented.
The U.S. Food and Drug Administration warned back in 2015 that e-cigarettes with flavors like cherry and cotton candy were particularly attractive to children and could be dangerous in and of themselves. The agency drafted a rule that included a ban on flavored products and then sent it off to the White House for approval.
LA Times reporter Emily Baumgaertner explains what happened next.
EMILY BAUMGAERTNER: The draft went into the White House including a flavor ban, and it came out without that flavor ban. It also came out without 15 pages of evidence that detailed exactly why those flavors were so dangerous for children.
MARTIN: And what did your reporting indicate about – do we know what happened there?
BAUMGAERTNER: We learned that more than a hundred lobbyists and advocates came to the White House in about a 45-day span. What’s interesting here is that you see some of the representation coming from vaping companies, vaping groups, even small businesses, but you also see big tobacco companies arriving.
So you have companies like Altria, a tobacco giant, that sent four representatives right in the middle of this decision-making process. Altria, several years later, went on to buy a 35% stake in the company Juul, which was the most popular e-cigarette among teens. So you certainly see representation from the tobacco companies showing up at the Office of Management and Budget during this time frame.
MARTIN: Can I just clarify that, ’cause I think many people might find it curious that the tobacco companies were involved here because I think a lot of people have the impression that e-cigarettes are an alternative to tobacco products? I mean, the whole point was to get people to stop using tobacco products. That’s not true?
BAUMGAERTNER: Very interesting point that you make. And that’s a question that many federal officials are trying to get to the bottom of right now. Even in Congress, Senator Durbin is on top of this issue. You’ve seen companies like Juul arguing that they are an alternative to tobacco, that they’re even a safe alternative to tobacco. But, of course, giant tobacco companies have a large stake in the company. So a lot of people are wondering the same thing you’re wondering – how can that be?
MARTIN: So when you approached former Obama administration officials to ask them what happened there, what did they say?
BAUMGAERTNER: The argument on behalf of the Office of Management and Budget, which is essentially the economists in the White House, is this was going to have a very, very, very large effect on small businesses around the country. And they felt that the science wasn’t yet strong enough to make such an economic burden on those companies.
It’s important to note that the Office of Management and Budget often serves as a bottleneck for regulations, no matter the political party. Often, once the Office of Management and Budget touches a regulation, it tends to weaken.
MARTIN: And, well, you say in your piece that after these rules took effect in 2016, sales for Juul, the most popular e-cigarettes, skyrocketed by more than sixfold. And you say this reversed decades of progress on youth smoking and that by 2018, about 4.9 million middle and high school students were using tobacco products. This, according to the Centers for Disease Control and Prevention; you quote them in your piece.
Now the FDA is finalizing a policy to essentially ban flavored e-cigarettes. What lesson do you think we should draw from all this?
BAUMGAERTNER: You know, a lot of folks think that it’s good news that the FDA is finally making moves on this, but other groups say they’ll believe it when they see it. There’s a chance that the regulation could not go through fully.
And in the long term, what’s more important to notice here is that these acute infections that have people anxious about vaping are a very small piece of the problem. A much bigger part of the problem will be the long-term effects, the millions of teens who could switch to cigarettes, meaning hundreds of thousands more could die as a result of smoking in the long run.
MARTIN: That is Emily Baumgaertner. She’s a reporter for the LA Times.
Emily, thanks so much for joining us.
BAUMGAERTNER: Thank you.
Copyright © 2019 NPR. All rights reserved. Visit our website terms of use and permissions pages at www.npr.org for further information.
NPR transcripts are created on a rush deadline by Verb8tm, Inc., an NPR contractor, and produced using a proprietary transcription process developed with NPR. This text may not be in its final form and may be updated or revised in the future. Accuracy and availability may vary. The authoritative record of NPR’s programming is the audio record.
Are The Miami Dolphins Losing In Order To Get A Better Draft Pick?
The NFL’s Miami Dolphins have lost their first four games by staggering margins. Sports commentator Mike Pesca speculates on why the team is losing.
DAVID GREENE, HOST:
I guarantee it. This is one week on the NFL schedule where the Miami Dolphins will not lose. That’s only because they’re not playing. The Dolphins have lost their first four games – not just lost but lost badly by staggering margins. Not exactly a fun time to be a Dolphins fan, but commentator Mike Pesca says this is actually part of a strategy.
MIKE PESCA: The Miami Dolphins are what football experts call terrible. In fact, they are historically awful. The team is winless. They’ve been outscored 81-0 in the second halves of games. They have scored 26 points this entire season but given up 40 points per game, meaning the average Dolphins score this year has been a loss by a tally of 41-6. The dolphins are no strangers to the tank. A player named Tank Carradine was signed then released two times by the Dolphins this year. Also for the first three years of their existence, the Dolphins had a live mascot swimming in a tank in their stadium. But those aren’t the tanks that we’re talking about. In the Dolphins’ case, tanking means trying to lose in order to get a better draft spot, which are awarded by inverse order of finish. And the Fins were finished before the season started.
Tanking is a viable strategy throughout sports. The Houston Astros won a World Series thanks to tanking. The Philadelphia 76ers are regarded by Las Vegas as the fourth most likely team to win a championship largely thanks to tanking. Baseball, this season, offered more tanking than the 3rd Armored Division in the Battle of the Bulge. A record-setting four teams lost more than 100 games, which doesn’t just happen. Tanking is intentional, which is why it is seen as a shameful act to be publicly disavowed despite plenty of evidence that it’s sound strategy.
But in football, tanking is different. The physicality of the sport renders it dangerous. There is no whimsy in a play poorly defended. There is peril. When an outfielder misses the cutoff man, it’s an error. If a lineman misses a blocking assignment, it’s a health risk. Football, when played by compensated professionals, is just this side of the knife’s edge between rough and wanton.
Plenty of former fans have turned away because of the inherent risks and inevitable maimings. It’s not as if the individual players on a tanking team aren’t trying. It’s just that management strategy is to field a team with little regard to player quality. It is a chain assembled from the weakest links around, and that’s a chain that will break.
We’ve never seen an NFL team that is tanking as badly as the Dolphins. Their strategy isn’t just poor sportsmanship. The Dolphins’ experiment is, in a word, dangerous; in two words, borderline immoral. If a Dolphins player were to be seriously hurt in the pursuit of an exploitable quirk in the draft rules, that injury will be on the conscience of everyone in management in the league office who did nothing to forestall a season of purposeful losses.
Of course, there still may be some joy in Miami. ESPN has a statistical model that predicts the team will finish with not one but two wins. And one could come at the expense of the Washington Redskins, who are also winless and travel to Miami in a week. The Redskins are a terrible team, too, with quarterback questions and a porous defense. Their ineptitude, however, is come by honestly. They’re trying to win. They just can’t. You may wonder which model of failure is worse. But the answer is clear. The football the Redskins are playing is wretched. The kind of football the Dolphins are playing is wrong.
(SOUNDBITE OF TERRACE MARTIN’S “NEVA HAFTA WURRY BOUT DAT”)
GREENE: Commentator Mike Pesca. He hosts the Slate podcast “The Gist.”
(SOUNDBITE OF TERRACE MARTIN’S “NEVA HAFTA WURRY BOUT DAT”)
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NPR transcripts are created on a rush deadline by Verb8tm, Inc., an NPR contractor, and produced using a proprietary transcription process developed with NPR. This text may not be in its final form and may be updated or revised in the future. Accuracy and availability may vary. The authoritative record of NPR’s programming is the audio record.
Pharmacies Pull Zantac Over Concern That Contaminant Poses Cancer Risk
Major U.S. pharmacies have pulled Zantac and its generic equivalent off the shelves after concern about a contaminant that poses a small cancer risk.
MARY LOUISE KELLY, HOST:
If you take Zantac, or its generic equivalent for heartburn, it’s time to consider other options. In recent days, major drugstore chains have pulled these products from the shelves. The concern is a contaminant that can increase the risk of cancer. NPR science correspondent Richard Harris reports.
RICHARD HARRIS, BYLINE: This problem came to light in June when an online pharmacy that conducts its own quality testing came across a problem with ranitidine, better known by the brand name Zantac. Valisure founder and CEO David Light says the company had recently started doing safety tests for drugs, and one of his colleagues suggested that they look at ranitidine.
DAVID LIGHT: His infant daughter was prescribed ranitidine, the syrup form that is given to infants. And so that was one of the first drugs that we tested.
HARRIS: The results were a shock.
LIGHT: We found dramatically high amounts of NDMA.
HARRIS: That’s considered a probable carcinogen and is found in various food products. But in the drug, it was in concentrations that exceeded federal safety standards. At first, they suspected this was a contaminant from manufacturing, but Light says NDMA – that’s N as in Nancy – NDMA might actually show up after the drug has left the factory.
LIGHT: Our tests in lab conditions seem to pretty clearly show that the drug is able to degrade into NDMA by itself either in the tablet or actually in the human body.
HARRIS: If that’s indeed what’s going on here, it might be an inherent property of the drug. That would be bad news for the companies that manufacture those drugs, but it’s not a problem for consumers.
MIKE CAROME: In the case of ranitidine, it is not an essential lifesaving medicine for which there are no available alternatives.
HARRIS: Mike Carome at Public Citizen’s Health Research Group says there are many other choices, and that’s left him wondering why the Food and Drug Administration hasn’t acted swiftly. France and Canada, among other countries, have taken stronger actions. And in the past few days, so have some of the major pharmacy chains in this country by pulling ranitidine products from the shelves.
CAROME: They’ve taken an appropriate public health action. I think they’re trying to build trust with their customers and retain that trust in contrast to how the FDA has approached this.
HARRIS: The FDA tells NPR it has run its own tests and validated the findings from the online pharmacy. The agency says it’s also asking drugmakers to run their own tests and to send samples to the FDA.
Richard Harris, NPR News.
Copyright © 2019 NPR. All rights reserved. Visit our website terms of use and permissions pages at www.npr.org for further information.
NPR transcripts are created on a rush deadline by Verb8tm, Inc., an NPR contractor, and produced using a proprietary transcription process developed with NPR. This text may not be in its final form and may be updated or revised in the future. Accuracy and availability may vary. The authoritative record of NPR’s programming is the audio record.
Will A Season Of Extremes Lead To An Extremely Entertaining MLB Postseason?
Does having four 100-win teams in the playoffs for the first time make for an epic Major League Baseball postseason? NPR’s Mary Louise Kelly gets a preview from The Ringer’s Michael Baumann.
MARY LOUISE KELLY, HOST:
Major League Baseball is now almost literally hit or miss – teams leaguewide combined for the most home runs and strikeouts in one season. Now, for teams, a 100-win season is one for the ages. On the other hand, a 100-loss season is a total disaster. You usually see one, maybe two each year. This year, there were four of each. So will this season of extremes lead to an extremely entertaining MLB post season? Well, for that, we turn to Michael Baumann. He covers baseball for The Ringer.
Welcome.
MICHAEL BAUMANN: Hi. Thanks for having me on.
KELLY: Hey. Good to have you with us. All right. So I want to get to the postseason in just a second. But first, is all of this good for baseball fans? I mean, it’s fun to show up and see a bunch of home runs, but are we all going to get complacent – that if we show up and there aren’t at least 10 home runs in any given game, that it’s just a boring one?
BAUMANN: I don’t perceive any sort of lack of interest among your everyday fans or your – certainly baseball purists. And you know, to a certain extent, I’m one of them who would like to see the ball put in play a little bit more than it is right now. But this is just sort of how the way baseball’s played right now.
KELLY: What about on the flip side – all these teams with a hundred losses in a season?
BAUMANN: This actually is something that worries me about the future of the sport. What we’ve seen is a very small handful of teams really going all in. And that means pursuing free agents. That means prioritizing winning over financial incentives. And even teams that traditionally run huge payrolls, like the Red Sox, Yankees, the Dodgers, are starting to respond to financial incentives far more than competitive incentives. And so it doesn’t matter, necessarily, how many fans you draw because the amount of money coming in through cable and online broadcast rights is so great that teams essentially don’t have to draw fans to the ballpark.
So teams that make the effort – and we see this in attendance as ticket prices continue to go up as spending goes down – teams that made an effort in the off-season – the Phillies drew – they were very active in free agency – drew 7,000 more fans this – per game this year than they did last year. And we’ve seen ambivalence from teams that are just content to throw any old team out there and collect leaguewide revenue-sharing checks.
KELLY: All right. Well, let me focus you on the good news, which is we do have, as we mentioned, four 100-win teams in the playoffs. They are the Astros, the Dodgers, the Yankees and the Twins. Does this mean we’re in for some spectacular baseball in the postseason?
BAUMANN: I certainly hope so. Two years ago, essentially this Astros team and this Yankees team played a great seven-game American League Championship Series and followed that up with the Astros and the Dodgers having an incredibly entertaining seven-game World Series. I think there’s – as many as eight of these teams are really scary, are just loaded top to bottom with either power pitching or power hitting or, in Houston’s case, both. And I think we’re – one nice thing about baseball right now is there’s an incredible wealth of charismatic young stars. We’re going to see several of those on display.
KELLY: I’m going to put you on the spot. If you had to put money on it right now, who’s going to make it to the World Series?
BAUMANN: Before the season, I predicted Houston over Washington. I think Houston is definitely the best team in this bracket. The American League side is a little bit tougher, so that gives me a little bit of pause picking them to win it all, but I think they’re the best team.
Washington – I really like the way they’re set up with their starting pitching, with some of the hitters that they have. But they’ve got to make another round as the wild-card team. So I’m a little hesitant to pick them knowing that within a couple hours of this show going out, my National League pick could be wrong. But you know, I really like the way they – their roster’s set up for this postseason if they can make it past tonight.
KELLY: We shall see if they prove you right. Michael Baumann of The Ringer – we caught him via Skype.
Thanks so much.
BAUMANN: All right thank you.
Copyright © 2019 NPR. All rights reserved. Visit our website terms of use and permissions pages at www.npr.org for further information.
NPR transcripts are created on a rush deadline by Verb8tm, Inc., an NPR contractor, and produced using a proprietary transcription process developed with NPR. This text may not be in its final form and may be updated or revised in the future. Accuracy and availability may vary. The authoritative record of NPR’s programming is the audio record.
Schwab Cuts Commissions To Zero, As Free Trading Edges Toward The Norm
Charles Schwab is slashing its online trading commission from $4.95 to zero starting Monday. The company cited competition from new online rivals.
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Wall Street is in a race to the bottom. On Tuesday, Charles Schwab said it will slash its commissions for online trades to zero in response to looming competition from app-based upstarts like Robinhood.
The brokerage firm’s stock was down 10% in the afternoon. Its competitors took a bigger hit, with TD Ameritrade shares falling 25% and E-Trade down about 17%. In its announcement, Schwab said eliminating online trading commissions equates to about $90 million to $100 million in quarterly revenue, or about 3% to 4% of revenue.
Schwab is bringing its online trading commission down for U.S. and Canadian equities and exchange-traded funds from $4.95 to zero starting next Monday. The firm already offers commission-free trades on hundreds of ETFs.
“It’s the right thing to do for clients, removing one of the last remaining barriers to making investing accessible to everyone and continuing our tradition of challenging the status quo on behalf of individual investors,” Chief Financial Officer Peter Crawford said in the announcement.
He also cited competition from both traditional e-brokers and new firms in the market.
These newer firms, including Robinhood and Acorns, market themselves with commission-free or low-cost investing and are often mobile-friendly and aimed at younger people. Crawford said Schwab isn’t feeling pressure from them yet, but didn’t want to wait too long to respond.
“It has seemed inevitable that commissions would head towards zero, so why wait?” he said.
TD Ameritrade and E-Trade charge $6.95 for online trades. And JPMorgan Chase offers 100 free trades in a customer’s first year.
It’s unclear if TD Ameritrade will match Schwab dive to zero. In an email, spokeswoman Becky Niiya said the news just came out, but her firm will remain competitive.
A representative from E-Trade couldn’t be reached for comment.
Devin Ryan, an analyst at JMP Securities, predicted Schwab’s competitors will eventually respond, given the pressure their shares are under, but Ameritrade and E-Trade would lose revenue if they match Schwab.
In a note to clients, Ryan said the brokerage industry is entering a new commission price war as free trading becomes the norm.
He said eliminating commissions will be manageable for Schwab.
“Given Schwab’s stated focus that price does matter and its roots as a low-cost provider, we think this decision was an inevitability over time as the company does not want to be in the minority in charging customers for trading,” Ryan wrote.
Editor’s note: Charles Schwab & Co. is one of NPR’s financial sponsors.
Peter Talbot is an intern on the NPR Business Desk.
Startups Face Skepticism As They Move To Sell Shares To The Public
Calling yourself a tech company doesn’t work like catnip on investors anymore. Startups riding the tech boom are facing skepticism as they move to sell shares to the public.
MARY LOUISE KELLY, HOST:
WeWork is putting off its initial public offering, meaning it will not be selling shares of its stock to the public anytime soon. The company leases office space and then rents that space out to other businesses. Not too long ago, it was seen as full of promise. But as NPR’s Jim Zarroli reports, investors are rethinking their love of new, high-growth companies with slim chances of making a profit anytime soon.
JIM ZARROLI, BYLINE: WeWork has always had a definite Silicon Valley vibe. Its charismatic co-founder Adam Neumann favors black T-shirts with frayed collars. And when he speaks about the company’s business, leasing workspace to young entrepreneurs and mature businesses, he has a casually messianic zeal. Here he is in 2017 at a conference.
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ADAM NEUMANN: Being surrounded by a group of like-minded individuals, being part of something bigger than yourself inspires people to work harder, spend more time at work and just have fun doing it.
ZARROLI: When WeWork announced its initial public offering, it generated lots of excitement. Then investors began looking at its books, and they didn’t like what they saw. Not only was WeWork burning through billions – much more than anyone thought – but its corporate structure and Neumann’s leadership were fraught with problems.
Lise Buyer is founder of Class V Group, which advises companies about IPOs.
LISE BUYER: The terms were so egregious. The governance was an embarrassment. And it took magic – it took a leap of faith greater than the Grand Canyon to see how that business could be profitable anytime soon.
ZARROLI: Last week, Neumann was ousted as CEO. And today, the company said it was shelving its IPO.
IPOs are supposed to be a way for new companies to raise a lot of money in the stock market. But lately, some high-profile offerings have become duds. The Hollywood power player Endeavor Group also scrapped its IPO last week. Companies such as ride-hailing giant Uber and Peloton, which streams exercise classes, started with a lot of buzz. But almost right away, their stock price fell victim to gravity.
Lise Buyer says investors have become much more skeptical about young companies that aren’t turning a profit and don’t know when they will.
BUYER: Investors are less willing to believe in the smoke and mirrors and, trust us; someday this will happen. And they want to understand what needs to happen between today and Day X.
ZARROLI: This shift in sentiment calls to mind the dot-com boom of 20 years ago, when investors threw all kinds of money at young startups, only to lose their shirts when the market crashed. The IPO market is nowhere near that bad today.
Renaissance Capital has an IPO investment fund, and it’s still up for the year, but it’s fallen 12% since the end of July. Renaissance co-founder Kathleen Smith says the mood on Wall Street has definitely changed.
KATHLEEN SMITH: Investors basically said, no more. And I would characterize it as an IPO buyers strike or a boycott of IPOs that look like the ones that have been failures so far.
ZARROLI: Smith says this isn’t necessarily a bad thing. Investors are getting more realistic. She says, eventually, the IPO market will rebound, but it will take a while.
SMITH: We anticipate that the IPO market will be pretty much virtually shut down for the next couple months.
ZARROLI: As for WeWork, the company says it plans to do another IPO later, though it’s not saying when. That means it’s not going to get the huge infusion of cash that it was hoping for anytime soon. And The Wall Street Journal reported today that it will have to compensate by laying off thousands of employees and selling off Neumann’s $60 million corporate jet.
Jim Zarroli, NPR News, New York.
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NPR transcripts are created on a rush deadline by Verb8tm, Inc., an NPR contractor, and produced using a proprietary transcription process developed with NPR. This text may not be in its final form and may be updated or revised in the future. Accuracy and availability may vary. The authoritative record of NPR’s programming is the audio record.
College Athletes In California Can Now Be Paid Under Fair Pay To Play Act
A new California law allows college athletes to get paid in certain scenarios. That’s setting up a clash with the NCAA, the governing body of college sports.
AUDIE CORNISH, HOST:
A bill making it legal for college athletes in California to get paid is now law. Governor Gavin Newsom has signed the Fair Pay To Play Act, giving college athletes the right to make money off their name, image and likeness. He did so over the objections of the NCAA, which oversees college sports. It sees the law as a threat to the traditional model of amateurism in college athletics. NPR’s Tom Goldman reports.
TOM GOLDMAN, BYLINE: It was a bill signing California-style. Governor Gavin Newsom sat in a barber’s chair on the set of basketball superstar LeBron James’ HBO show “The Shop.” James has been an outspoken supporter of the bill. He and the other guests on the show watched as Newsom put pen to paper.
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GAVIN NEWSOM: All right. Well, let’s do it. Let’s do it, man. All right.
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GOLDMAN: Newsom explained why the Fair Pay To Play Act was important.
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NEWSOM: It’s going to change college sports for the better by having now the interest, finally, of the athletes on par with the interests of the institutions.
GOLDMAN: The law will allow California student athletes to earn money from endorsements, sponsorship deals and other activities related to their athletic skill. They’ll be able to hire agents. The bill will not require colleges and universities to pay players, but schools – and certainly the NCAA – aren’t happy about it. There’s concern California schools will have an unfair advantage when recruiting athletes and that the law will push college sports toward professionalism.
Of course, many Division I college sports certainly appear professional, with palatial football stadiums, huge TV contracts and coaches making multi-million-dollar salaries. The NCAA wouldn’t comment today about an earlier warning that California schools could be banned from NCAA championships because of the law. But Governor Newsome doesn’t think that’ll happen.
NEWSOM: They can’t afford to do that, can’t afford to lose the state of California. It’s truly a nation state. And the economic consequences of it would be profound. No. 2, I don’t think they have the legal right to do that.
GOLDMAN: The Pac 12 Conference, which includes four prominent California universities, says it’s also disappointed with the new law. Among its criticisms, the law will have a negative impact on female athletes, which the original bill’s author, California Senator Nancy Skinner, says is wrong – because, she says, women don’t have the same opportunities as men to become professional athletes after college.
NANCY SKINNER: For women, this might be the only time they could make any money.
GOLDMAN: Several other states are considering similar laws to the Fair Pay To Play Act. California’s law is scheduled to take effect in 2023. Tom Goldman, NPR News.
Copyright © 2019 NPR. All rights reserved. Visit our website terms of use and permissions pages at www.npr.org for further information.
NPR transcripts are created on a rush deadline by Verb8tm, Inc., an NPR contractor, and produced using a proprietary transcription process developed with NPR. This text may not be in its final form and may be updated or revised in the future. Accuracy and availability may vary. The authoritative record of NPR’s programming is the audio record.
