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Sunday, April 1, 2012

Conference Realignment Earthquake is Here

This is the big one folks.

Multiple sources (Columbus Dispatch, Dallas Morning News, Chicago Tribune, Kansas City Star, LA Times, The Oregonian, Seattle Times, and Arizona Republic to name a few) are reporting that a major NCAA Conference realignment press conference is scheduled for Monday April 2 at 10 a.m. in Chicago. According to these reports, The Big 10, Big 12, and Pac 12 are expected to announce that they will become one single conference and have already reached a preliminary deal with Fox Sports in the neighborhood of $400B (yes, that's Billion) for a multi-faceted TV, Bowl, media deal that will certainly shake the foundation of college sports going forward.

Details of the deal are as follows:
1) In addition to the 34 teams already members of the conferences, expansion of 6 more teams will take place by July 1. Fox will buy out all teams/conference from current deals to start this Fall.
2) All games played going forward will be conference games among the 40 teams. Non-conference matchups are obsolete.
3) The Fiesta Bowl and Rose Bowl will be exclusive property of the new conference, and will also match conference teams. Other minor bowls are in negotiation for acquisition and will feature "intriguing and geographical matchups" among the 40 teams.
4) An eight team playoff is a done deal.
5) Fox gains full rights in schedule making; although each school will be allowed to retain 3 permanent rivals, the other 8 regular season games will be defined by Fox. Some flex scheduling is presumed, where Fox will match teams late in the season that fans want to see.
6) Fox announces that 20-25 new networks will be formed geographically around the member schools. Expected subscriber fees will be in the neighborhood of $5 - $10 per channel per month (and bundled as one purchase).
7) Revenues per school per season are expected to top $100M.
8) The TV contract runs through 2111 (99 year deal) or if Earth collides with the Sun, whichever happens first.

More details are emerging.

The Conference is likely to be called the "Big Pac Fox" (Fox must be included in the Conference name, according to multiple sources...hey, that's what $400B buys you).

As for how the additional six schools will be selected, sources confirmed that "we'll pretty much take applications and consider football value. On July 1, those being accepted will receive a red rose in the mail. Think of it as a $100M per year red rose. If you don't receive it, you just got demoted to the minors." This also solves the problem of crappy mismatches in the early season like Rice vs. Purdue or Appalachian State vs. Michigan.

According to Pac 12 Commissioner Larry Scott, the Rose Bowl will feature (current) Pac 12 and Big 10 teams exclusively. And "not those Johnny-come-latelies, Colorado, Utah, and Nebraska are not on the invitation list."

The AP has already released a statement that it intends to have two college football polls going forward. According to incoming AP President and CEO Gary Pruitt, "there's no way we can be expected to vote on this conference vs. other teams when they don't play. We'll just have two polls." The American Football Coaches Association is expected to follow suit. Computer poll guru Jeff Sagarin also stated this his algorithm "blows up" if there is no cross games played between two entities so he'll likely have two polls as well. The Downtown Athletic Club of New York released a statement indicating that they are leaning toward "two Heisman trophies in two different ceremonies".

As for how to find a conference champion, according to Larry Scott, all teams with the best record at seasons end will be declared regular season conference champions. However, Fox retains the right to set up an 8 team playoff with any teams it chooses, regardless of record. The championship game will be the Fiesta Bowl, noting that if the matchup is "crappy" Fox also retains the right to replace one (but not two) team to make it more appealing. Big 10 commissioner Jim Delaney was quoted as saying "we're not going to let a team like Kansas State or Arizona in this thing, we need to have the big schools to deliver value to Fox". This scenario will likely not happen, as multiple back room conversations have confirmed that Texas, OU, Ohio State, Michigan, and USC will "pretty much have automatic playoff berths every year" with other teams battling for the last three spots. Penn State will get deference as well, but given their recent troubles are not quite as automatic.

When asked about this plan and scheduling overall, Baylor president Ken Starr was quoted as saying "they can schedule us against the Green Bay Packers for 12 games if they give us $100M for the year."

The TV channels are a lynchpin to the deal. One intern at Reuters did the math and figured out if there are 20 new channels at $10 per month, that would be approximately $200 more per cable/satellite bill per customer. Larry Scott was quoted as saying "that's not my problem, I wouldn't want to be the DirectTV president and tell my customers in Ohio that they weren't going to see Ohio State play every Saturday." Jim Delaney added "We think the value is more like $20 per channel per month, we're starting out low." According to Texas AD DeLoss Dodds, Fox acquired the LonghornNetwork last week from ESPN "for pennies on the dollar" and plan to make it the cornerstone/model for the other regional networks.

More on TV, Fox is already planning a new Saturday Morning Kickoff show (presumably to compete with College Gameday). Details emerging are that it will be 4 hours long, Jimmy Johnson, Howard Schnellenberger, and Lou Holtz will be round table guests (Holtz is under contract with ESPN but is "tired of having to argue with that young kid who doesn't know anything" and was ready for a more visible spot). Charissa Thompson's name has also been bantered about as a likely on air talent to offset the gruff look of the gentlemen mentioned above.

Fox is expected to have Tuesday, Wednesday, and Thursday games every week, leaving Monday for the NFL, and Friday for a preview show that will probably include campus coverage and multiple coach interviews. Campus coverage will include walking dorms and interviewing students, crashing fraternity parties, and walking the main night life areas of campus.

To ensure value in both the gate and TV, ticket prices are expected to skyrocket. According to Michigan President Mary Sue Coleman "we're probably looking at $300 - $500 per ticket with a 10% discount for students." Given the 100,000 seats at the Big House, that's a good $50,000,000 in gate per game at the high estimates. Now you start to see how the financials work here. They've got you paying $2400-$2500 more in cable bills plus season tickets in the $10K range. It's not like you can just not watch the game, right?

The permanent rivals for schools are starting to leak and are predictable. Mich/OSU, Texas/OU, USC/UCLA, but also include Nebraska/OU, and USC/Texas if a leaked report is to be believed.

The logical question is "what do the other conferences do". When contacted, SEC commissioner Mike Slive indicated that Scott and Delaney had made him aware of these plans. He noted that "we even horse traded over who got stuck with the Big East...both of us wanted the Big 12, but I bet Delaney that he couldn't name all 120 FBS teams in 120 seconds. He did, and they got the Big 12." He added that neither of them was sure who they should contact to congratulate the Big 12 since "I didn't think the Big 12 had a commissioner anymore."

Slive indicated that he and ACC commissioner John Swofford had a "marathon bourbon drinking session" and crafted together a similar merger. Including the Big East. Slive was quoted as saying "you can make dad-gum sure we'll make more money than they do, and have more teams." When asked what their new conference might be named, he indicated that discussions were to keep the SEC brand as the best conference, and given that ESPN was the only TV negotiating entity left, the working conference name is "The SEC brought to you by ESPN" or the "SEC-E" for short.

When asked about the possibility of migrating toward Big Pac Fox vs. SEC-E matchups, Slive was quoted as saying "this whole damn thing is a charade by Delaney to stop having our teams bash his Big 10 teams brains in. So I'm guessing 'no'".

Delaney responded "what's that, I have $400B in my ears, I didn't catch it". He added a swipe that "we were glad to let them have the Orange Bowl. Nobody watches that thing, I mean it's almost always ACC vs. Big East. Yawn."

Other more minor details are also coming out. Fox will retain the right to rename one building on every campus after one of its TV personalities (Homer Simpson, Hank Hill, and Scully are the first that come to mind). Nearly unlimited access to players (including class and webcams in dorms/apartments) are assumed. Around 10 players per school per week will be "miked" 24/7. And Fox gets all radio broadcast rights from the universities. One rumor has them shutting down radio coverage to make sure their TV negotiations have leverage.

Collateral contracts include presumable exclusive deals for apparrel, such as Reebok or Nike paying in the 8 - 11 figure range for exclusive rights for uniforms, adds, the whole gamut.

Additional revenue sources being considered is setting up a 10 mile radius around every stadium on gameday and charging $50-$100 per vehicle to enter (residents exempt). One idea shot down was to have a weekly auction to have a fan join the broadcast team in the booth for two possessions. Although bids would be expected to reach six figures, the effect on the broadcast was a dealbreaker to Fox.

It's expected that, after the SEC-E fills up their 41 (or more) slots, the remaining 40 or so FBS teams will merge with the FCS and form what is to be called the "Versus Conference" (working title). Probably one game per week on TV.

It was noted that, not as if it was in one year, but $400B would be the 30th largest GDP if it were a country, just ahead of Belgium.

When asked how this affected the other sports like basketball and baseball, Delaney and Scott both looked at each other and said almost in unison "I don't think we thought that far ahead, did you hear the $400B part?"

3 comments:

  1. Two words: So freakin' excited !!1!

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  2. Phase 1 of the above plan already recommended...conference take over bowls...check!
    http://www.cbssports.com/collegefootball/blog/dennis-dodd/18246334/ncaa-task-force-conferences-could-take-over-bowl-system

    ReplyDelete
    Replies
    1. Can they really mess up a playoff? Don't answer that. :)

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