MWC Tex
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RE: Aresco on AAC FB: "to be viewed as competitve with the other five conferences...
(02-11-2015 08:59 AM)quo vadis Wrote: (02-10-2015 03:00 PM)Attackcoog Wrote: (02-10-2015 01:18 PM)quo vadis Wrote: (02-10-2015 11:58 AM)Attackcoog Wrote: (02-10-2015 11:09 AM)msm96wolf Wrote: Group of 5 was created by the CFP as to conferences that don't have a Major Bowl Tie-In to Rose, Sugar or Orange. To become part of this club, a G5 would have to get a tie-in to a major bowl. This Tie-In will not happen for at least 11 years, if ever. Worse case scenario for a P5 conference should be 54 Million dollars which what the ACC will get at minimum for 2015 due to the loss of the Orange bowl. Otherwise, it will be 77.5 Million during Orange years. G5 makes 16.5 Million. Even in the off years, the P5 makes 3x what a G5 could make. This does not take the TV Contracts into account. Rumor is the ACC is shooting for 2016 for the ACC Network. If it can pull in 70% of what the SEC does, it will be a huge success. G5 have as much chance as a FCS moving up to FBS. It will be teams the move to the P5 not a conference.
I think Aersco was smart doing a the TV Contract they way he did. However, I am not sure he will get the payday he hopes. The AAC needs ESPN, not ESPN needs the AAC. What I would love to see Aersco pull off is a deal with NBC to have AAC Games shown national every week. Believe it or not, I think the AAC would be wise to do a short term contract with NBC even if ESPN offered more money. Imagine having the AAC Game of the Week over the air and that be the home of the AAC Championship. That would be a huge step for the AAC.
That's EXACTLY what happened last time. ESPN actually offered more money during the exclusive period than the AAC ended up getting. The issue was there were fewer televised games than with the old Big East contract and more games shoved to ESPN-3. As a newly developing league, Aresco and the presidents felt they needed exposure more than the money. So they passed on what they might have received from ESPN to take their chances on the open market.
The problem with that open market strategy was two-fold. One--ESPN had the right to match and open market offer. The AAC could not sign an agreement without offering ESPN the right to match the exact same deal. Two---on the heels of all the late 2012 defections, the AAC appeared very unstable which chased away most bidders. Effectively, the only serious bidder on the open market was NBC. You needed at least two bidders to create some price competition and the AAC was never able to create that dynamic (this is something CUSA should work to avoid as I think they could end up with this same problem when they go on the market).
With that dynamic, NBC was convinced that all they had to do was offer tremendous exposure (which ESPN would be unable, or at least unwilling, to match) with little money and the AAC would be forced to accept. NBC saw that they would get a solid FBS football league with good basketball for a song. They knew ESPN would never offer the kind of exposure they could, so they figured ESPN would never match the bid---thus they could low ball the price.
Turns out, ESPN found a way to match NBC's exposure (mainly by opening Saturday slots on ESPN-News) and ended up getting the ACC for less than they were originally willing to pay (though they did have to significantly dial up the exposure to match the NBC contract specifications). For the AAC, exposure on ESPN beats exposure on NBC-Sports by a mile---so the decision to stick with ESPN was a no-brainer.
This is correct in all respects except the two parts I bolded.
First, the part about NBC's thinking is purely speculative. We don't know what NBC thought ESPN would or would not do, and there is no evidence that they "low-balled" us or would have made a different offer had they known ESPN would match the offer they did make. An alternative explanation is that they offered exactly what they thought the AAC was worth, in terms of both money and exposure. This makes sense, because game theory says that any time you are in a negotiating situation where another party has the right to match your offer, you should make the very best offer you are willing to make, because you will not get a chance to make a counter-offer.
Second, ESPN had the right to match NBC's offer, so Aresco and the AAC had no "decision" to make, they had to take ESPN's offer, or else go without any kind of TV deal at all. Aresco had no power to stick with NBC's offer.
As I understand it, the ESPN right to match was not a perpetual right to hold a set of media rights by simply matching competing offers on a one time basis.
It is simply a contractual obligation for the conference to allow ESPN the last opportunity to match (or beat) the offer prior to signing a contract with another network. CUSA violated this clause by signing with Fox without presenting the offer to ESPN first. CUSA would still have been free to sign with Fox if they chose, ESPN claimed CUSA violated the agreement by not even giving ESPN a chance to view the competing offer. My understanding is the same dynamic was in operation with the AAC.
My understanding was that ESPN claimed CUSA violated a number of terms - they claimed they negotiated with FOX during a time when ESPN was supposed to have exclusive negotiating rights, that they reneged on an agreement with ESPN, and they did not give ESPN their first-refusal rights. So it was a number of things. I guess we would have to delve deeper into this.
FWIW, I would not expect that the AAC/ESPN "match" provision is perpetual, unless the AAC renewed it in the latest deal. That is, unless the NBC offer that ESPN matched had a "match" provision, then the current ESPN deal wouldn't have one either. If the current contract does have a match provision, then that means the AAC/Big East agreed to accept that provision when they signed ESPN's matching offer, they didn't have to accept it, since that would be going beyond the terms of the NBC offer. My understanding was that the AAC only had to accept the ESPN offer it matched what NBC offered, both in money and in terms, such as a match condition.
Well, that pattern appears to be the ESPN standard, so I'm guessing that all ESPN contracts has the right to match and the AAC is pretty much in screwed if ESPN matches any other offer when the current contract is over with.
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