(01-13-2018 11:07 AM)GE and MTS Wrote: Conferences aren't going to invite just anyone because that's who the networks will pay for. Kansas State isn't going to the Big Ten, BYU won't go to the PAC 12, Wake Forest to the SEC, etc.
Likewise, conferences are unlikely to invite schools if they don't improve the conference, specifically their income.
This is a disingenuous line of argumentation. Of course they don't. The way it works is the conferences set parameters and make a list of preferred targets. The networks peruse those and offer a sum for the ones they approve of. And in some cases the networks make a direct recommendation of a school previously not considered, e.g. Missouri.
So the bolded part of your statement is irrelevant. If the network wants somebody they pay the conference enough to make it worth their while. If they don't want somebody they low ball the offer.
This is why the market footprint model was used to do the networks bidding on several levels.
For instance in '91 when the networks weren't nearly as heavy handed the SEC had designs on Clemson and Florida State. ESPN didn't want the SEC to have control of a large state. That kind of leverage means the networks have to pay more to sell advertising space in that large state. They gave the SEC an estimate for what they would pay for Florida State's valuation. It was enough that we could make the offer. But they likely also gave that figure to the ACC and also likely told them the date of our offer because the ACC showed up 1 day earlier and made a slightly better offer. Bowden then made his excuse of seeking a path of least resistance to the championship.
Amid the ACC's problems in 2010-1 those two schools came up again. This time a clause that ESPN put in the SEC's contract came into play. No re-negotiations unless two new markets were added, a clause worded to exclude the two most likely SEC targets, Clemson and F.S.U. who are within our footprint and are the two most SEC like schools in the ACC, a product 100% owned by ESPN, where those two football programs make up a significant portion of value for ESPN's investment. But, ESPN was trying to work a larger deal that involved one of the SEC's other long term goals, Oklahoma so they made a large offer for A&M and the suggestion came through channels for Missouri which they also approved of for a large market for the SECN. Interestingly enough the concept of Virginia Tech and N.C. State in the SEC was floated. We had not considered them in the past and the rumor was released to test SEC fans on the concept and the reasons why to consider them were put out there to sell it.
It was an attempt again to break up the hold a single conference had over two large markets, North Carolina and Virginia. Texas A&M was approved in spades because it did the same to the Big 12's hold over the extremely large Texas market.
The footprint model was a ruse from day 1. Why would the ACC be paid for all of ESPN's subscriptions in Florida, and the SEC be paid for the same when rationally they should have been paid for the % of Florida that each carried? Ditto for the SEC in Texas, or if the SEC had gotten N.C. State and Virginia Tech.
Look at the ESPN lineup of schools and plot them on a map. ESPN pushes to own the majority of rights to every noteworthy school in a state whether that school is in the SEC, ACC, or AAC. What they don't want is a conference holding all of the properties in a state. This strategy gives them the highest possible advertising revenue total in each state where they hold the rights to all of the product, but through various conferences. They never intended to keep the footprint subscription payout model. Had time permitted they would have shifted to a % of payout based on the % of the market a particular state school actually carried. However streaming is going to change that and do so in a way that is going to be more advantageous to their pay model than just a % of the market carried. Now they are going to have a reason simply to pay for actual viewers and perhaps eventually on a model that accumulates pay by event. I'm sure they will still make offers of steady payouts, but it will be gauged upon a compilation of actual viewers per event.
ESPN has its sights on Texas (the state) and I'm sure they will want the top schools in different conferences for the same reason. They have majority rights now to S.M.U., Houston, and Texas A&M through the AAC and SEC. They have a 50% stake in Texas, Texas Tech, T.C.U. and Baylor's T1 and T2 rights through the Big 12, but share that with FOX which also has a 50% stake in those schools. They protected the most valuable product they have by creating the LHN as a T3 contract with Texas. Since Texas is a state nearing 28 million potential viewers I'm sure that ESPN would love to control the FOX portion of the Big 12 schools. Oklahoma penetrates DFW in a significant way. FOX has Oklahoma's T3 and shares the T1 and T2 of course with ESPN.
Should Oklahoma and Oklahoma State move to the SEC at some point, as ESPN talking heads have suggested more than a few times over the past couple of years, it gives ESPN compete control of Oklahoma since Tulsa is in the AAC. And having OSU and OU in the SEC isn't as costly to them since Oklahoma is a small state of just over 4 million. That leaves them needing just a little more interest in Texas Tech and T.C.U. to effectively own the rights to key entrance points into advertising on Saturdays in Texas.
And to complete this picture ESPN and FOX only lease the PAC rights 50/50. So the only conference that FOX exercises any control over is the Big 10 where they own roughly 51% of the BTN and hold a slight advantage in T1 & T2 rights over ESPN.
So when you plot all of the properties on a map a pattern, that is quite clear even to the un-initiated, emerges. ESPN is about owning outright the rights to the region of the country that is growing, is only interested in having options in the West where the viewing numbers are weak for college sports, and interested in having dibs on enough of the games in the Big 10 to have draw from that region for ESPN programming. But they are all about the Southeast and whatever it takes to capitalize on Texas. The additions of Pitt, Syracuse, and Boston College were about protecting their investment in the ACC by keeping what was, at that time, an independent BTN from obtaining those markets, which would also give the BTN access to grow Southward down the Atlantic coast. And by taking as much of a lucrative, but not necessarily fanatic, college sports market in New York and New England ESPN could create a lure for Notre Dame which is a valuable draw for that region and key Big 10 cities not under ESPN control. Notre Dame is a great back door into Indianapolis, Cincinnati, Chicago, and Detroit in addition to being a darling in the Northeast.
Pitt, B.C. and Syracuse were not natural moves for the ACC. The ACC was a convenient tool for ESPN to use to get them. Missouri was not a natural addition for the SEC. The SEC was a convenient tool to get them. My point being these were network moves motivated out of control of markets. They were not moves that the conferences would have suggested or had reason to think would or could or should happen.
In this business controlling the valuation of potential additions is tantamount to controlling the process. Of course the SEC wasn't going to add Florida State if ESPN our contract partner wasn't willing to pay us to take them. So it didn't matter what the SEC wanted. We got what we were paid to take, whether or not the school was on our list of desired properties. Ditto for any of the conferences. We set our parameters and ESPN paid us to take their choice out of those. Or they suggested a product that fit our parameters should they not be on that list.
This also emphasizes the obvious as to why Iowa State is in a tough spot. Iowa is a state of a little over 3 million and Iowa State has good attendance, is AAU, and is an extremely stable if average product in sports. But it is not a growth state of note. The Big 10 draws best there, and their real problem would be lack of interest from ESPN. Some kind of move with key properties to the PAC would be their only salvation if the Big 12 goes away. The same is true for Kansas State. Kansas has some brand value, but they don't offer a significant market to either the SEC or Big 10. The populations of the Big 12 states is roughly 40 million. Texas and Oklahoma together account for 32 million of that and covers all of the necessary markets to monopolize ad rates in Texas. By taking Missouri, ESPN effectively cut off the Big 10's best pathway (marketwise) to Texas. The Big 10 already had deep penetration of the Kansas markets. Now the Big 10 will have to go through Kansas to get to either of the top two brands left for football, Oklahoma or Texas. The fat markets of Houston & DFW are why the Big 12 is so vulnerable. Those lucrative markets are the lure for the two strongest conferences one of which ESPN controls and the other which is complicitous with FOX.
Maybe the recent Disney acquisition of FOX properties abates that tension for acquisition of that region, maybe not. We'll see about that. But the Big 12 only became unstable because of unequal revenue in a conference where the value of markets was already terribly imbalanced throughout its boundaries. That's where the ACC always had the upper hand. From Miami to Atlanta to Boston the markets were reasonably uniform in value with Atlanta of course being the plumb. Hence the ACC despite lower revenue (because no school there was of the value of Texas or Oklahoma) was more stable.
The Big 12 was not stable, and not because Texas was a bear to deal with, because they are, but because there was no way that that Texas and Oklahoma were ever going to be able to justify complete revenue sharing because it meant giving too much away. And more importantly because the networks can make so much more by placing those two schools somewhere else.
But back to the main point. If the SEC/B1G just wanted Texas and Oklahoma and those two said no there would have been no realignment from the Big 12. The Colorado's and Nebraska's and Missouri's might have been unhappy, but they would have stayed. It was the fear of Texas and Oklahoma leaving, and not their behavior, that created the momentum for movement. Nebraska, a very small state, felt vulnerable as the lure of network money started creating the possibility of movement so they took the very best pathway out for them. Missouri realized their situation as well. Colorado had the more natural fit to get out and took it because of the same threat. But when Texas A&M left, Texas finally felt a loss of control. A&M was the move that made Oklahoma truly nervous. And in each case, behind those moves were networks picking off the key brands and markets carefully whittling away at the support structure of Texas and OU. So by denying eastward expansion to the Big 10 and SEC the networks set those two conferences on a pathway to dismantling the Big 12.
Last year's entourage of hopeful G5's just put a stamp on it. There is no avenue for more revenue for the Big 12 as it is presently comported. There is an avenue for Texas and Oklahoma to more revenue, leaving. Hence the vote not to expand, and not to renew the GOR. But make no mistake, this was not the machinations of the Big 10, or the SEC. The Big 10's growth plans were to the East and ESPN blocked them. The SEC's growth plans were for consolidation of the best sports properties in the Southeast. ESPN blocked them. Why? They didn't want the Big 10 or SEC gaining even more leverage in their own natural markets. But they would use Texas and Oklahoma, by the elimination of our preferred moves, as the only options to the kind of growth that either the Big 10 or SEC would want. Why? Because it is not enough to simply hold Texas and Oklahoma in a market where they play schools that don't maximize their value. But the schools of the SEC or Big 10 would maximize that value and Texas and Oklahoma would maximize the value of the either of those conferences. The synergy of those moves means millions more tune if for key games. So not only do they reach the key markets in Texas but Texas and Oklahoma reach the key markets in either the Big 10 or SEC.
It's about the networks period. Until the rise of the networks ability to sculpt their own product by offering revenue, or withholding it, realignment was random and local. After OU/UGA versus the NCAA for TV's sake, it was not. This isn't a conference based phenomenon. It's a network driven one. The moves benefit the networks or they don't pay for it. Nothing much happened for 100 years except a few breakoffs of conferences within regions until schools were free through their conferences to negotiate TV contracts. That was all of the opening the networks needed. There was no longer a bureaucratic entity called the NCAA to have to deal with. So since '91 realignment is a network agenda and the conferences have been motivated by money. It's not the other way around, or we would all have grown quite differently.