JRsec
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RE: Big Ten targeting Texas and Oklahoma?
(12-08-2018 12:02 AM)33laszlo99 Wrote: (12-07-2018 01:59 PM)JRsec Wrote: (12-07-2018 11:57 AM)johnintx Wrote: (12-07-2018 10:58 AM)arkstfan Wrote: (12-06-2018 02:21 PM)ken d Wrote: I'm not at all sure Texas would follow Oklahoma to the B1G even if they were invited to do so.
Texas cannot afford to lose the Red River shootout. The donation value of being in line to get one of the seats at the Cotton Bowl is extremely valuable to UT.
With TAMU off the schedule, losing OU would be untenable. The impact on the value of the TV contract would be significant. The Sugar Bowl pays $17 million+ to take the Big XII champion if the champion is not in the CFP or to take the highest rated available team from the Big XII if the champion is in the playoff.
With OU out of the lineup that looks like a much shakier investment.
Texas doesn't have to follow OU, in fact it wouldn't be surprising if Texas opted to NOT follow, but the Big XII without OU is much less viable.
Lifelong OU fan here, but not an insider at all.
Today's status quo works for OU football: we generate enough revenue to be nationally competitive while playing regional rivals. The B12 gets a bad rap nationally (partially deserved), but OU has now qualified for three CFP's as part of it (or in spite of it).
When the B12 GOR and TV contracts expire, all bets are off. I seriously doubt the ability of the B12 to score similar media deals in the next round of negotiations. OU will listen to both the B1G and SEC. I will not be surprised to see OU in either conference.
Texas is the 800 pound gorilla. It's the largest school in the second largest state, with a massive alumni and fan base. In addition, it has the academic reputation that college presidents like. If a conference sees the need to expand, they need to make a play for Texas, whether they think they will succeed or not.
The B1G needs OU's football program. But, OU's academic reputation is inferior to the members of the B1G. If the B1G makes a play for OU, it has to make a play for Texas first. For the presidents and academic leaders, it has to be an academic move. UT checks those boxes. OU would be a tagalong, academically. The B1G cannot pursue OU alone. They have to pursue OU in a package with UT and/or Kansas. Even as part of a package deal, the consideration of OU is a stretch for the academically minded leadership of the B1G.
OU's academic leaders would looovvvve to be associated with the B1G. It would be a harder sell to the fan base, even if the B1G were able to do away with divisions and arrange more games with tOSU, UM, and PSU. The SEC would be a much easier sell to the fan base. The SEC is a better cultural and institutional fit, as well.
It will be a bidding war between the B1G and SEC. If these tweets are true, the B1G is taking steps to get ready.
I agree with your assessment. The hard sell for the Big 10 will be Texas. The Texas business model which is the strongest in college football would be alien to the Big 10 and Big 10 revenue sharing even from just a % of ticket sales would be anathema to Texas. And that doesn't even take into consideration the desire of Texas to play as many games at home or away at other Texas venues as possible. Since the Big 10 would be unlikely to take any other Big 12 Texas school with Texas that creates a major hurdle where the Horns are concerned.
Kansas would be a likely fit for the Big 10 culturally, academically, and athletically with regard to hoops prestige. However, Kansas may not be able to pay its way into the Big 10 with lousy football, and not much to offer outside of basketball which isn't a Big 10 need. The Big 10 already carries the major markets in Kansas and that too doesn't work in the Jayhawks favor. The old farm adage is apropos here, "Why buy the cow when you are already stealing the milk?"
That said I absolutely expect the Big 10 to make a run at Texas and Oklahoma. But I'm not sure they are headed anywhere. They tried to outlast the ACC to see who folded first thinking that if it was the ACC they could pick up the markets and brands they needed to survive. Why would that kind of thinking change now that the PAC seems vulnerable? They would make even better additions than schools from the ACC would have.
I think Texas continues to slow play realignment to see what might shake loose from the PAC. Oklahoma could move on their own, but they've made the CFP for the last two years and probably feel little athletic pressure to do so.
In the end I expect the SEC will get a fairly significant bump for an undervalued T1 contract. I expect the Big 10 to get a much smaller bump on the renewal of their 6 year deal with FOX. And both conferences will continue to increase the revenue gaps they have with respect to the ACC and PAC and that eventually they'll expand again because of it, but possibly not in 2024-5.
But, if the networks come in with a stagnant offer to the Big 12 that might be enough to knock OU and Kansas off of a static position and if so then Texas may have to be proactive.
So movement in 2022-3 (which is when I think it will happen if it is going to happen) is possible. I just don't see it as probable without a catalyst besides the desires of the SEC or Big 10.
You have sound arguments, JR. I don't disagree with anything there. But I think that mystery catalyst you mention could be among these:
The SEC T1 contract might well get a big bump, especially if Fox tries to add the SEC to their advertising footprint. But ESPN needs the B1G footprint even more, which was borne out in the last B1G media deal. ESPN has been trying to mitigate that problem, but the TV ratings of the B1G cannot be overlooked. So where will they each spend? If ESPN needs to overspend on the SEC, even by remaking the entire media deal, would they do it in order to attract Texas? Will Disney allow such extravagance? If the FAANG gang shows up, the ESPN contract handcuffs the SEC.
No, Texas is not good at sharing, but if changing conferences still gives them enough income to remain the revenue king, they just might go co-op. As for those in-state games they love so much, and they really do, that sentiment likely lives among the fans much more than with the administration. From a fan point of view, trips to SEC destinations would be appealing. But I think the University Administration, and Austin in general has become more akin to Berkley than the Austin of 25 years ago. These guys might be more enthusiastic about weekends in DC, NYC and Chicago.
Some say future of the Big 12 will be rosy and prosperous. But I think they walk on thin ice. If the B1G shows signs of scoring a fat contract, the ones who have an opportunity to join the gravy train will probably not let it pass them by.
From 2016-17 the Big 10 Network lost 448 million in total value according to SNL Kagan. However the annual report due out this year in April was never released. The Big 10 has good ratings, but the SEC has strong ratings with greater depth into the conference. The Big 10's model was more heavily predicated on the subscription fee footprint payout model. The content driven model is the new winner and the SEC has more brands with which to multiply content value than most conferences.
I don't think FOX or ESPN are particularly well positioned should the FAANG companies want a bidding war, but at what cost to national exposure would going with them one of them come? It's an uncharted territory. Most college administrators are risk adverse and I just don't think we'll see the advent of the FAANG companies in college sports in nearly as big a way as some seem to think, especially at this time.
I also think that this time around that FOX has incentive to work with ESPN behind the scenes. They do hold a lot of Disney stock now and it would benefit both companies should the Big 10 and SEC expand out of the Big 12. How? If they were able to make the moves in advance of 2024-5 they could renegotiate the value of the Big 10 and SEC's total contracts, extend the current contracts before they come open for bid (with the exception of the SEC's T1) and keep the top product out of the FAANG companies hands for another decade. They currently share the T1 and T2 rights for the Big 12 (a purchase) and the PAC (a lease). They could conceivably work an early deal with the PAC as well and accomplish all of it out of the Big 12. It's that kind of catalyst I was thinking about.
Texas would have reason to work with with both in this matter and to resolve the LHN which could be accomplished in a number of ways without costing the Horns the balance of the contract.
So, I'm not so sure that this comes down to a FOX vs ESPN action as much as it is likely to come down to a FOX / ESPN preemptive strike. Brokering out the Big 12 would likely be the tack taken. But it's a big wait and see.
Kansas isn't required by the Big 12 to make a major renovation of their facilities for football and their stadium, but they have. I can't see that happening at that level of debt without some tacit promises already in place. When the desire to discuss additions to the Big 12 died I believe it is because everyone finally accepted the inevitability of either staying at 10 to preserve revenue, or moving. Baylor and T.C.U. have made renovations as well with Kansas and TCU making them inclusive of amenity seating for donors.
Could this money be poorly spent? Perhaps. But more likely assurances were made by someone at some level before these renovations proceeded. Schools wouldn't spend that kind of money in preparation for a move to the G5 where their existing venues would probably be fine.
How would they divvy these up? That's anyone's guess. But if it does play out this way I don't see Texas and Oklahoma moving together. I could easily see Texas and Tech moving together, the Oklahoma schools moving together, and some other combinations being possible. It might be why the divisionless talk is coming up as well. If you opened up the composition of determining the conference finalists then absorbing more Big 12 schools could be more easily accomplished if needed, and if the PAC doesn't play ball in this matter then it opens up other possibilities.
But all of this is under the assumption that there is movement at all. And things could easily remain stagnant until the mid 2030's should Texas think that acquisitions from the PAC are possible, or if they should feel that after a few years of the ACCN that economic pressures might continue to mount in that area. They've been playing an active game of chicken with the ACC since 2010. Having the PAC go through a rough patch may actually the the catalyst for stasis.
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