(06-03-2015 10:13 AM)WKUYG Wrote: What it sounds like is they can get the games cheaper from espn than dealing directly with a conference and espn can recoup most of their money spent on the MAC
Assuming that ESPN distributes the cost of the rights fees across all the covered events (for simplicity sake using basketball and football only) the cost per is very low on an accounting basis.
The MAC receives $10 million that would cover aproximately 72 football games and 180 or so basketball. That works out to about $40k per event. For AAC it is about $72k per event.
CBS only owns the right to pick a select number of events. CBS pays about $350,000 per event from CUSA.
ESPN can sell the rights to AAC at $100k and carry that as profit for that game, they can sell a MAC event at $50k and make about a $10k profit on that game.
Any unused inventory goes ESPN3.
A bare bones broadcast will run up $70k or as low as $50k.
Say CBS makes $450k from a telecast of AAC or CUSA and $200k from MAC, the profit margin on AAC and MAC is going to be higher.
That's why ESPN is "buying the whole banana" they can carry the games on ESPN/ESPN2 at a high profit margin vs the rights fee for the game, they can resell some of the excess at an OK profit margin and then break even or carry a small loss on ESPN3 content, but they can use the increased ESPN3 content as leverage to hold or increase the carriage fee for ESPN3.
Some smart boys and girls working in Bristol.