Wolfman
All American
Posts: 4,465
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I Root For: The Cartel
Location: Raleigh, NC
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Does ownership in conference network give media company any advantage?
ESPN and Fox both have stakes in conference networks. Does this give them an advantage when it comes to negotiating media rights deals?
At first glance I am thinking no. These networks show mostly tier 3, non-revenue sports. Still, I'm wondering if FOX, being part owner of the BTN, will have an advantage during the B1G media rights negotiations?
If the answer is yes, then there will definitely be an ACCN. ESPN won't want FOX to get their foot in the "back door."
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07-12-2015 07:10 AM |
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Big Ron Buckeye
Special Teams
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Joined: Jun 2008
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I Root For: THE Ohio State
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RE: Does ownership in conference network give media company any advantage?
In my opinion, yes ownership in a conference network is beneficial to the network as well as the conference. Granted all of these deals are for a specific amount of time, but what an ownership stake represents is a percentage in a potentially very valuable venture. Let's take the SEC as an example. To my understanding, the deal is a 50/50 split of revenues after operations expenses however ESPN retains 100% ownership in the SEC/ESPN Network. It is a good deal for the SEC because they have the most powerful sports conglomerate behind their content. It is a GREAT deal for ESPN because they have rights to basically all SEC content sans the CBS package in perpetutity. The SEC wants the most value possible so they'll want to push as much content as possible to the network. The SEC by definition can't shop around their ownership as they dont own anything so ESPNs position is solidified. Value is quantified in general terms as the discounted value of future revenues, so if those revenues have no end date and project to keep increasing for the foreseeable future at a resonable clip per year... it is a very wise business deal. So long as projected revenues can cover operations plus some, I'd do as many networks with as many conferences as possible.
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07-12-2015 05:08 PM |
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