🕶e8: Toss Me The Natty…Wait?
👋 Good Morning and Happy Sunday! Welcome to the e8 newsletter, a hand-picked collection of business and start-up news, resources for entrepreneurs, job/internship postings, and noteworthy trends that are happening this week! I hope you find this weekly newsletter informative and engaging!
🏈 🍺 Toss Me The Natty…Wait? Nothing like a cold Natty at 7am on game day. But this year, college students might not have the luxury of experiencing such a beautiful thing. As U.S. cases rise to 70,000 per day, an increasing number of notable athletic departments, including Ohio State, Clemson, and Oklahoma, report positive tests among student athletes. With training season and school starting in the coming weeks, the NCAA faces a difficult decision: is it possible, or even worth it, to play college football this season? For university towns and the local businesses that rely heavily on sports departments to generate revenue, this only adds to the burden of the COVID-19 pandemic. Could college towns fade into ghost towns? With college football being a primary source of revenue for these large universities, a lost season could wipe out $4 billion in total revenue, according to ESPN. Also of consideration are the players who’ve put thousands of countless hours to be able to compete at such a level. Could their scholarships be revoked? Let’s dig into what’s going on and how game day might look for you this year.
According to a recent survey by Stadium, athletic directors at big conference programs have downgraded their outlook for a normal start to the season, with many expecting a delay beyond the Aug. 29 official start for college football, and predicting participation in conference games only
Since the start of the COVID-19 pandemic, schools have cut, dropped, or suspended 61 Division I teams and 176 programs across all NCAA levels, according to data from MatTalkOnline.com
Other conferences are already preparing for the worst: the MEAC, Ivy and Patriot Leagues took the plunge and canceled fall sports in 2020, while the CAA scrubbed its upcoming football season
Canceling college sports is not only detrimental to the die hard fans, but also the economy at large. Coronavirus-related shutdowns affected many different businesses. Just take a look at Penn State where local hotels lost 96% of their revenue in April, 92% in May, and 80% in June, according to the tourism bureau. I pondered possible solutions for the hospitality industry but I honestly couldn’t think of one. The unfortunate reality may be that many of these businesses shutter their windows permanently, overall negatively affecting the local economy.
Furthermore, other cities like Columbus, Ohio, which was ranked No. 2 in the nation heading into the fall after playing in the college football playoffs in December, are home to many of the largest private employers such as Chase Bank, Nationwide, and Honda, in addition to state and local government offices. It’s evident that the cancellation of football games could lead the city to losing “hundreds of millions of dollars in lost revenue,” stated Don Perro, president and CEO of the Columbus Chamber of Commerce. "This is like a double whammy for these restaurants and caterers ... who cater tailgate parties!"
One other concerning factor is the volume of non-revenue-earning program cuts.While this is completely unfair to the athletes of smaller sports, I understand the schools’ decision to focus on where profit can be maximized most. While there is always hope and optimism, I think it’s most important to be realistic in the foreseeable future. We still have a virus that doesn’t seem to be leaving soon, and thousands of scholarship players to be taken care of first!
🚫 Cancelled? Nah, Banned! AGAIN? Epic Games, the developers behind gaming behemoth Fortnite, have really stirred up some chaos in the app, tech, and business communities this week with the recent price drop of their in-game currency, V-Bucks. Many Fortnite players are enjoying getting more bang for their buck, but for Epic this was a declaration of war to Apple and Google, as they added an option to bypass the in-house app stores’ purchasing systems. Let’s explore how this move proceeded and how it could affect the global mobile (say that out loud three times fast lol) application market!
What We Know
The V-buck price drop wasn’t looked upon kindly by the tech giants as they swiftly denied access to millions of mobile users attempting to play the game
Epic games, in turn, launched a protest video inside the game designed to mock Apple’s iconic “1984” Macintosh commercial
The commercial was displayed to the 350 million who play the Epic Games around the world
This isn’t the first time that a big tech giant has been under fire for their monopolistic practices. Last year, Spotify filed an antitrust suit with the EU against the Apple App Store citing the unfair treatment the company received after the release of Apple Music. A big portion of other antitrust complaints have to do with Apple’s 30% “App Tax”, a chunk of cash that non-Apple companies must cough up when competing with Apple’s own applications.
While 30% seems like a heavy price to pay to have your app on the App Store, I believe that the price can be justified. As reported, “Apple touted a separate Analysis Group study that found the App Store facilitated $519 billion in commerce during 2019.” When a company is processing this much volume on their platform, infrastructure and security are top priority! Therefore, the more resources they’re able to invest into these facets will lead to increased reliability and trustworthiness with consumers. In a separate study, The Analysis Group investigated other major industries commissions and stated, “The commission rates charged by digital marketplaces most similar to the App Store, such as other app stores and video game digital marketplaces, are generally around 30%. Marketplaces that distribute digital content such as videos, podcasts, eBooks, and audiobooks [also] generally charge commission rates of 30% or more.’
At the same time, I believe Apple could be more flexible and progressive with regards to aspects of this tax. Just this year, Facebook announced that it would not be collecting fees from online events for the next year in an effort to help small businesses recoup from Covid.
Overall, game developers' trust and commitment may diminish in the short term, as they are wary about Apple’s control over the App Store and the company’s commitment to bringing the best games to mobile. At the end of the day, it’s understandable to see the frustration from big and small developers alike and although Apple might come out unscathed this time, I think the immense social pressure from developers and consumers will force the company to start rethinking the landscape they govern.
👀 Interesting Follows
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📹 Facebook Is Testing A TikTok-Style Short Video Format On Its Main App In India
🚗 Michigan Is Devoting A 40-Mile Stretch Of Highway To Testing Self-Driving Cars And Improving Public Transportation
🎭 Making Better Decisions In A Crisis With Help From The Ancient Greeks
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💯Thank You For Reading, See You Next Week!
What's up, my name is Evan Hiltunen! I am a recent finance grad from Indiana University and financial analyst @ Goldman Sachs. I have a strong passion for start-ups, finance, and technology, and I hope you find this newsletter informative!
I’d love your feedback - feel free to email me