JRsec
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RE: If There Is A Breakaway
(01-27-2014 01:10 AM)CintiFan Wrote: (01-26-2014 07:08 AM)JRsec Wrote: (01-26-2014 02:55 AM)CintiFan Wrote: (01-26-2014 01:26 AM)JRsec Wrote: If there is a breakaway then everything we have thought about realignment to date essentially changes.
1. GOR's were drawn up for the television rights to NCAA football games. They would need to be reworded and signed for the television rights to the new entity that would be formed. Departures from the conferences under GOR's would be to a new entity and not in direct competition with the former conference as it would be within the closed set of NCAA schools. The whole legal dynamic would shift and need to be rethought.
2. Contracts would all have to be renewed and a new value would have to be calculated. Why? Content! Without all of the run of the mill FCS and lower end FBS schools to schedule (schools which would not be in the new entity) the content value for all contracts would go up.
3. Structure: In a new league with freedom to construct divisions, internal playoffs for the respective conferences, and the right to determine the length of the regular season the total value of the television rights might well exceed what they currently are. Especially valuable to the networks would be their ability to help to shape the new structure in ways that would increase cross regional interest and boost advertising.
4. Conferences would or could be rearranged from the beginning. In other words realignment could take place simply to augment the playoff structure. The number of teams participating would be governed by entrance criteria: Total athletic investment, size of attendance, facilities, number of sports offered, athletic endowment size, ability to participate in full cost of attendance scholarships for all athletes, etc.
Once the number of full participants are known the division of conferences could be handled quite easily. Four conferences of between 16 to 18 schools would be likely in such an event. Inequities for the PAC could be handled easily and after the Big 10, SEC, and PAC have established their 16 or 18 teams a new conference could be formed by holding out some top schools and building around them.
5. If all of the P5 schools were not unanimous in their desire to breakaway the pressure created by the main three conferences doing so would compel the remainder to make a move.
6. There is no reason the G5 could not join us in such a move. We could share basketball, baseball, and minor sports and still have separate playoffs for football championships. If basketball only schools made the break the could fall into the G5 structure and still compete with the upper tier without affecting television contracts for the upper tier.
In a breakaway world I would think the networks would want to try to balance the 4 conferences without disturbing the present members of the SEC, Big 10, and PAC. The Big 10's interest in the states of North Carolina and Virginia and the SEC's shared interest in both as well shouldn't pose a problem for balancing competition. The football in those two states is average at best. The SEC and Big 10 would be enhanced in markets and in hoops. In such a scenario I could see several combinations that could arise but the most profitable would be Virginia and Duke to the Big 10 and North Carolina and Virginia Tech to the SEC or Virginia Tech and Duke to the Big 10 and Virginia and North Carolina to the SEC.
I think a new conference could be formed for athletic balance using some kind of arrangement like this:
Boston College, Notre Dame, Pittsburgh, Syracuse,
Louisville, N.C. State, Wake Forest, West Virginia
Clemson, Florida State, Georgia Tech, Miami
Baylor, Kansas State, Oklahoma State, Texas Tech
The PAC might look like this:
Iowa State, Kansas, Oklahoma, Texas
Arizona, Arizona State, Colorado, Utah
California, Cal Los Angeles, Southern California, Stanford
Oregon, Oregon State, Washington, Washington State
But no matter how you configure it the structure would be balanced with the desire being to create a natural flow from division champ to conference champ to national champion.
So how would you lay out, configure, or balance an upper tier where we were free of NCAA constraints and conference legal entanglements?
I don't think a breakaway, if it happens, has an immediate impact on realignment. The GORs are contracts between the conferences and their member institutions. Likewise, the media deals are contracts between the conferences and ESPN/Fox. I don't think the NCAA is a party to either the GORs or the media deals, so they would remain in place, as is, even if a breakaway occurred.
On the flip side, I think the NCAA does have the media deal for March Madness and, without the top conferences, the NCAA's media deal could crash unless the breakaway conferences agree to continue to play in the NCAA's tournament. Maybe the P5 create their own March Madness tournament instead and invite a few NCAA teams to it.
From my perspective, even if a breakaway occurs, almost all of the obstacles to realignment stay in place. The GORs are still there, the media deals the conferences signed are still in place, ND will still want to be independent, Texas will still want to be king of its own conference and UNC and its friends will still want to have an ACC conference in place.
That could change, depending on what new rules the breakaway group agrees on. If stipends for athletes, minimum athletic budgets, minimum number of sports or other such requirements make it too expensive for for smaller, less well financed schools to participate, then some individual schools will decide to downgrade their athletic programs and join lower tier conferences. I assume the P5 will waive the GORs for schools that want to join lesser conferences. That may spur some additional realignment at the edges (such as UConn or Cinncinnati replacing a departing Wake Forest, for example) but not the fundamental realignment you envision.
Rebranding and slight shifts in conference affiliations could still create a contractual and GOR issue. But let's assume those do remain in place. Structural changes are all that would be necessary to drive realignment. Also if contracts move, inequities in them move as well. In a closed system that provides less remedy for those inequities. Those same key schools you speak of already feel the shackles of that inequity and feel trapped in their conferences. Texas is well aware of its golden cage that the LHN has placed them in. Oklahoma knows that the lack of peer institutions is harming its program. North Carolina, Duke, Virginia and N.C. State may desire to rebuild their kingdom, but schools like Florida State, Clemson, and Georgia Tech may have other desires and without football chops the value of the present ACC melts away. Even their traditional basketball powers are weakening. I think you may see three or four conferences make the breakaway, establish their new parameters in a new structure and then absorb the rest of the qualifying schools within that new structure. If there is a breakaway I think you will be looking at only a P4.
In the event that something like this occurs it will still take only 8 departing Big 12 schools to dissolve the GOR (should it remain intact) and the conference and it will still take 12 schools to dissolve the GOR (should it remain intact) and the conference for the ACC. Either way it gets done.
I do think there are a handful of schools beyond the present P5 that could make the jump and that the final structural setup will depend on that number minus any departures due to the qualifications. But should there be 4 or 5 departures that could work against them as well. I don't think the new league would want to open Pandora's box up to independence. Notre Dame would have a choice to make. It wouldn't be the NCAA and their politics would not be as likely to save them this time around. It has only been the desperation of the weakest conferences that has permitted their unique situation (outside of the service academies) to exist. B.Y.U. took advantage of the precedent set by Notre Dame so I don't really count them.
And one more point, if there is a breakaway and 5 schools choose for instance to remain in the NCAA from the ACC, the networks will want out of their contracts with the ACC and will not be hankering to enforce them. I'd like to see what chances they would have of enforcing their GOR under those circumstances. At that point the GOR would become a restraint of trade issue. No if any significant portion of an existing conference makes a breakaway the pressure will be on those who remain behind, not on those moving. If the research triangle crowd desires to remain intact then they need to be among the first to agree to breakaway so that they do get to keep their conference, if indeed that is what they desire to do. Sometimes all that is really needed for change is a good excuse and I would say that a breakaway would provide one.
I agree that the Achilles heel of the GORs is that they essentially terminate if the media deals terminate. We don't know what rights ESPN/Fox, or for that matter the conferences themselves, have to terminate the media agreements. It's certainly possible that minor changes in conference makeup might give the networks the right to terminate, but it seems to me more likely that the networks would want to keep the agreements in place but reach some accommodation with the conferences. Instead of a right to terminate, the contracts may simply allow for a predetermined adjustment to the price if one or more minor schools leave and are not replaced with a comparable school. No one that signs a major contract wants to see it terminated, or be renegotiated, unless they really have to. A vote to dissolve a conference, though, would almost certainly give the networks a right to terminate and they would exercise it.
I also agree that that Texas, ND, UNC or some of the other top schools may decide within the next few years that they would be better off joining the PAC, SEC or B1G. I just don't see any conference challenging a GOR and expending the time and money needed to challenge it. If they win, they potentially invalidate their own GOR, so whay do it? Its ironic that the GORs that Texas and UNC orchestrated to get in place, which were designed to keep other schools from bolting their conference, would ultimately prevent them from doing what they wanted. Sweet justice, I think.
From the perspective you lay out everything you say is true. Now try it from the network's perspective. I believe the GOR's went into place because first ESPN was afraid that Texas (after the LHN kept them from moving to the PAC) might be forced out of the contract if Oklahoma, Kansas, OSU, or WVU bolted. So ESPN desires the GOR to make sure that their adversaries in FOX couldn't figure out a way to get Texas into the Big 10 and out of the LHN by virtue of extraneous market circumstances outside of Texas's control. Maryland gets snatched as a product and throws the ACC into a tizzy and properties from Virginia to Florida State appear quite vulnerable. Essentially the same GOR goes into effect for the ACC.
Kudos to Fox. They successfully initiated two attacks on the corporate mouse within half a year, both resulting in a purely defensive posture for ESPN. What did it accomplish? Bargaining power and some concessions eventually to some property rights in the Southeast by ESPN. FOX wanted into the most lucrative region of the country for college football, a region that save for 1 slither owned by CBS was in ESPN control. Does anybody really think that Jim Delany was interested in seeing his conference map lose consolidation to have one thin leg extending down the Eastern Seaboard? I don't. I think Delany would have been very happy entering into North Carolina and Virginia and consolidating a Northeast block for the Big 10. Those rumors and that ruse were about convincing ESPN that they could be vulnerable. It was about leverage.
You suggested that it might be possible to lose minor components within a conference and for the network to make adjustments. I agree. By holding both the ACC and SEC properties ESPN was in a position to maximize both, but not by moving major pieces, but by moving minor ones. Connecticut, and properties of value from the Big 12 were in position to be moved accordingly by simply providing the space to do so.
I've had my doubts about the availability of Virginia Tech to the SEC because they are a mid range football value to the ACC. I have not had such doubts about N.C. State. The ACC footprint can optimize the SEC by losing 1 of its 4 North Carolina schools. That could be accomplished by swapping a private for a private (Vanderbilt for Wake Forest) but neither one really delivers a state. But if the ACC agreed to move N.C. State they could pick up West Virginia and Connecticut to move to 16 full members and essentially solidify and repair the broken footprint left by Maryland's departure. The SEC would then be free to add Oklahoma and Texas could take the indy deal with the ACC. FOX moves Kansas to the Big 10 and pays for them to take Iowa State (with ESPN's help). All of the three media controlled conferences have their 16. If the PAC desires to expand they have Kansas State, Oklahoma State, Texas Tech and T.C.U./Baylor to do it with. All five are better prospects than anyone else in their geographical region. And the four they select places their product in a new time zone thereby permitting them to sell more content.
FOX and ESPN can work the Texas angle any way they choose. If the PAC agrees to sell a portion of their network to either FOX, ESPN, or both Texas could move west with three of the other schools and the deal gets done. Texas could even enter into the SEC solution under the right circumstances. Kansas and Vanderbilt to the Big 10, Texas, Oklahoma and N.C. State to the SEC. If N.C. State refuses, then Texas, Oklahoma and West Virginia to the SEC. My point all along is that once the GOR's were signed any ability of a conference to broker its own deal went right out the window. The GOR's have permitted the networks to have direct consultation on all moves without seemingly being guilty of tortuous interference. Their media rights are at stake now so of course they will be at the table. Anything decided will be handled through the conferences, but the money necessary to make the moves will come from the networks to the conferences.
In essence the GOR's while originating as defensive moves on the part of ESPN to stall property movement in hostile takeover moves, now provides the instrument necessary for the networks in some form of cooperation, to sculpt the final stages of realignment. Now does this mean the end is near? I don't think so. Nothing happens until the PAC agrees to accept 4 of the Big 12 schools and that will take some time both to figure out who will be acceptable and to get the schools that may be involved on board. But some kind of maximizing of markets will be part of this process.
The reason I picked on N.C. State is that the ACC could lose them as a sports property, gain a new state, and only be stronger for their loss. And being in another athletic conference won't really affect their research projects with North Carolina, Duke and Wake, but it will permit all involved to make more money. That may not be the sentimental and historical perspective that will please all fans, but it is the business reality.
Anyway, I offered this as merely an example of the kinds of moves that could be made through the networks because of the GOR's and not inspite of them.
(This post was last modified: 01-27-2014 10:05 AM by JRsec.)
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