Sports Illustrated Cuts Entire Staff; Future Unclear

The entire staff of Sports Illustrated was laid off Friday after Authentic, a licensing group that bought the magazine five years ago, terminated its agreement with The Arena Group to publish the magazine in print and digital forms.

The agreement was struck three weeks after Arena missed a $2.8 million payment, breaching the company's licensing deal with SI that began in 2019, when Authentic bought the magazine for $110 million from Meredith, according to an email obtained by Front Office Sports.

Arena informed the SI employees through an email that their jobs were being terminated: "We were notified by Authentic Brands Group (ABG) that the license under which the Arena Group operates the Sports Illustrated (SI) brand and SI-related properties has been officially revoked by ABG. As a result of this license revocation, we will be laying off staff that work on the SI brand."

The email said that "some employees will be terminated immediately, and paid in lieu of the applicable notice period under the [the union contract]" and that employees whose last working day was Friday "will be contacted by the People team soon. Other employees will be expected to work through the end of the notice period, and will receive additional information shortly."

Arena did not respond to Front Office Sports when it was contacted about the plans for the layoff.

The Sports Illustrated Guild wrote on X on Friday: "We have fought together as a union to maintain the standard of this storied publication that we love, and to make sure our workers are treated fairly for the value they bring to this company. It is a fight we will continue."

Authentic's license termination came weeks after 5-Hour Energy founder Manoj Bhargava introduced himself to Arena employees, which included those from Sports Illustrated, as their new leader after his company, Simplify Inventions, bought about 65% of Arena for $50 million in August.

Sources with knowledge of the system told Front Office Sports that Authentic has been speaking with multiple parties about finding someone to take over Arena's role with Sports Illustrated.

It's not clear if Authentic will find someone to operate the decades-old publication or if it will allow Arena to negotiate the deal it currently has, but sources say that the company wants to move the process along as fast as it can, and will "see Sports Illustrated through a necessary evolution."

When Authentic bought Sports Illustrated in 2019, the Arena Group — operating as Maven, before it changed its name two years later — paid Authentic $45 million up front to begin a 10-year agreement for licensing.

The news about the layoffs came about a month after Sports Illustrated CEO Ross Levinsohn, along with several company executives, were fired amid the backlash over the outlet's use of AI-generated content.

Meanwhile, Inside sources told Front Office Sports that Authentic has been angry with Arena in the past few years, with Sports Illustrated going through several rounds of layoff and losing much of the publication's top talent.

Arena also on Thursday fired more than 100 employees throughout its organization, but Bhargava, who was named as the company's interim CEO in December, stepped down on Jan. 5, meaning someone else made the moves to cut costs.

According to an SEC filing, he left the position to "avoid any conflicts of interests" through his ownership of Bridge Media Networks, which is reportedly in talks to make a "substantial investment" in Arena.

Arena execs, its board of directors, and Jason Frankl, of FTI Consulting, who was appointed as Arena's chief business transformation officer when Bhargava resigned, carried out the layoffs.

"My immediate focus is to collaboratively design a growth-oriented media company, ensuring the financial stability necessary to cultivate and grow the brands we cherish," Frankl said in a statement, calling the layoffs "regrettably necessary."