(12-11-2020 11:49 AM)Schema Wrote: With these 15 additional games in the inventory and a guarantee of an afternoon timeslot on ABC each week, plus the opportunity to have additional primetime timeslots on ABC, the other conferences are definitely going to be losing out on ABC coverage. Do you guys think that means Disney is planning on not renewing or, at a minimum, altering their contracts with the other conferences moving forward?
The B1G's contract ends after 2022-2023.
The PAC-12's contract ends after 2023-2024.
The Big 12's contract ends after 2024-2025.
I could see lots of different scenarios happening. I could see FOX throwing huge money at the B1G to get them to go all-in with FOX, FS1, FS2. If that didn't work, I could see them trying to go all in with the Big 12 or PAC-12. I could see CBS working with the Big 12 or PAC-12 for a similar deal to what they had with the SEC. I guess the big question is what does Disney have planned and how hard will they fight to keep all of the content they currently have once they add the new SEC games.
The ESPN / Disney Strategy has been pretty clear for a long time. Once Boomers are out of the picture (statistically by 2036) there is only one region of the country where football is still beloved enough at the lower levels to keep the game profitable, the Southeast and Southwest.
Take some pins and plot all Disney properties that they own 100% on a map. They own literally all rights south of Virginia over to Missouri and South to Louisiana. They own all of the rights to the AAC teams in Texas and Oklahoma. Acquiring 100% of the rights to the Big 12 schools to control the largest football first states and their advertising rates for live events is their objective. That means picking up Oklahoma, Oklahoma State, Texas, Texas Tech and likely Baylor and T.C.U..
Maybe ESPN wants Kansas hoops but certainly not any football schools north of Oklahoma.
ESPN owns ~48% of the rights to Big 10 football and that is likely all they want. That gives them access to enough games weekly to pull in ad revenue from that region without having to buy 14 schools totally to just get 6 or 7. ESPN cherry picks the Big 10 for weekly #1 or #2 picks. Does anyone think they want to pay big money for Purdue vs Rutgers or Minnesota vs Northwestern, or anyone versus Illinois?
ESPN owns 0% of the PAC rights. They along with FOX lease 50% of the PAC rights each where again they are simply trying to fill 1 time slot, the late one with a #1 or #2 pick of games.
So Disney isn't out to corner the market on College Football, they are out to corner the market on college football where the sport will still be popular after 2036. And they want a toe in the Northern Midwest and in the Pacific West.
FOX isn't even that interested in college sports. They are going hard and heavy after pro sports. I can see them keeping the Big 10 and their lease in the PAC but they have already backed away from the Big 12 in part.
I expect the Big 10 to get a 10% to 15% bump on their revenue when they reup. People forget that the SEC's deal with CBS was for about 20 years and has been woefully outdated since 2010 prices were established. FOX's current rates were new 4 years ago and will only be 6 years old when they rework them. So the Big 10's valuations were much more current than those of the SEC's T1 inventory.
If the Big 10 gets a 10% bump, which is generous now that national appeal is starting to dip for a variety of reasons with regards to college football, they would be within 4 million of the SEC. If they get fortunate and get a 15% bump they will be within 2 million of the SEC. The SEC and Big 10 have historically been within 2 million of one another one way or the other when contracts were renewed roughly at the same time. So that's what I expect.
The question is who does ESPN land 100% of the Big 12's rights? Do they go after all of the rights, or do they lure Texa-homa to the SEC with the new rates and fold T.C.U. and Baylor into the AAC? Do they simply cherry pick Texas and Oklahoma and lure them to the conference they want them in with perks? Since ESPN wants a monopoly on sports rights in the sports crazy states my guess is they would prefer to separate the Texas schools and Oklahoma schools from Iowa State the two Kansas teams and West Virginia.
With Texas in the SEC the LHN revenue is eclipsed and that situation is resolved. Plus in a streaming world UT in the SEC is worth vastly more than anywhere else to them. That's true for Oklahoma as well.
But 65% of the total commercial value of the Big 12 resides in just Texas and Oklahoma. Making the AAC a Texas centric conference pays dividends to ESPN as well because of a regional audience of nearly 33 million between Texas and Oklahoma. Put Tech, Baylor, and T.C.U. along with OSU in the AAC adding them to S.M.U. and Houston and Tulsa and you have a massive regional appeal that helps the valuation of the product of the AAC. Eliminate the Big 12 by then moving Texas and Oklahoma into the SEC and perhaps a Kansas to go with Notre Dame to the ACC where N.D. adds football cred and Kansa is a content multiplier for hoops and that makes some sense as well.
So in short I see nothing that is going to alter the ESPN/Disney approach to rights. They already know where the future of football resides, they like the baseball tournament, and they have plenty of valuable basketball. What they want is exclusively high advertising rates for having the only path to advertising live sports for college loyal fans in the Southeast and Southwest. They only have 6 schools to acquire to have it all and none of them are in the PAC 12 or Big 10.