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ESPN can renegotiate new AAC TV deal with UConn leaving conference
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GTFletch Offline
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Post: #1
ESPN can renegotiate new AAC TV deal with UConn leaving conference
Sports Business Journal’s John Ourand reports in latest newsletter that ESPN now has the right to renegotiate the terms of the 12-year, $1 billion deal it signed with the conference back in March. Ourand writes that ESPN has a clause in the contract that allows it to open up the deal if a school left the conference.

With the deal taking effect in 2020-21, ESPN has time to mull over its options. The AAC does as well. The conference is reportedly looking at potential replacements, ranging from Army to Boise State.

Link
https://awfulannouncing.com/ncaa/espn-ca...rence.html
06-26-2019 07:22 PM
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quo vadis Offline
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RE: ESPN can renegotiate new AAC TV deal with UConn leaving conference
(06-26-2019 07:22 PM)GTFletch Wrote:  Sports Business Journal’s John Ourand reports in latest newsletter that ESPN now has the right to renegotiate the terms of the 12-year, $1 billion deal it signed with the conference back in March. Ourand writes that ESPN has a clause in the contract that allows it to open up the deal if a school left the conference.

This makes perfect sense, and I posted this link earlier this morning.

But don't expect sensible replies - i got about four replies from AAC fanboys saying that this story is trumped by the Navy AD's vague tweet in response to a vague question about UConn leaving and revenue distribution.

Apparently, the Navy AD Knows All, LOL. 07-coffee3
06-26-2019 07:48 PM
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RE: ESPN can renegotiate new AAC TV deal with UConn leaving conference
(06-26-2019 07:48 PM)quo vadis Wrote:  
(06-26-2019 07:22 PM)GTFletch Wrote:  Sports Business Journal’s John Ourand reports in latest newsletter that ESPN now has the right to renegotiate the terms of the 12-year, $1 billion deal it signed with the conference back in March. Ourand writes that ESPN has a clause in the contract that allows it to open up the deal if a school left the conference.

This makes perfect sense, and I posted this link earlier this morning.

But don't expect sensible replies - i got about four replies from AAC fanboys saying that this story is trumped by the Navy AD's vague tweet in response to a vague question about UConn leaving and revenue distribution.

Apparently, the Navy AD Knows All, LOL. 07-coffee3
Quo Troll. 03-shhhh Probably 57 going on 13.
06-26-2019 07:50 PM
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Stugray2 Offline
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RE: ESPN can renegotiate new AAC TV deal with UConn leaving conference
Why does everybody think this is a surprise? Why does anybody expect anything other than a modest adjustment of removing UCOnn's share form the payouts, but no increase or decrease for anyone else?

It's obvious Aresco knew this was likely, as he started lobbying for Division-less football. If Aresco knew, ESPN knew. Nobody is panicking, which tells me the contingency was basically agreed to in advance. Logic says everyone will get the same money. No increase per school, no decrease either.
06-26-2019 07:56 PM
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UCGrad1992 Offline
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Post: #5
RE: ESPN can renegotiate new AAC TV deal with UConn leaving conference
(06-26-2019 07:56 PM)Stugray2 Wrote:  Why does everybody think this is a surprise? Why does anybody expect anything other than a modest adjustment of removing UCOnn's share form the payouts, but no increase or decrease for anyone else?

It's obvious Aresco knew this was likely, as he started lobbying for Division-less football. If Aresco knew, ESPN knew. Nobody is panicking, which tells me the contingency was basically agreed to in advance. Logic says everyone will get the same money. No increase per school, no decrease either.

I agree. UConn made it known [publicly and privately] during the ESPN/AAC media deal negotiations that it wasn't happy with the terms. It's only a surprise to a few that are either poor at trolling or they've never worked with contracts. 07-coffee3
06-26-2019 08:18 PM
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slhNavy91 Online
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Post: #6
RE: ESPN can renegotiate new AAC TV deal with UConn leaving conference
(06-26-2019 07:22 PM)GTFletch Wrote:  Sports Business Journal’s John Ourand reports in latest newsletter that ESPN now has the right to renegotiate the terms of the 12-year, $1 billion deal it signed with the conference back in March. Ourand writes that ESPN has a clause in the contract that allows it to open up the deal if a school left the conference.

With the deal taking effect in 2020-21, ESPN has time to mull over its options. The AAC does as well. The conference is reportedly looking at potential replacements, ranging from Army to Boise State.

Link
https://awfulannouncing.com/ncaa/espn-ca...rence.html
And in the second bullet point of his post - not quoted by Awful Announcing - Ourand goes on to say:
Quote:The fact that ESPN included the clause in its contract does not mean that the network definitely will open up the deal, which goes into effect with the 2020-21 season. After all, football is the main driver of these media deals, and UConn’s football performance over the last decade has been awful...Sources told me that ESPN will wait and see how -- and if -- the AAC fills the spot vacated by UConn.
06-26-2019 08:32 PM
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Side Show Joe Offline
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RE: ESPN can renegotiate new AAC TV deal with UConn leaving conference
If the AAC is smart they will use this opportunity to get their inventory off of espn+, and sell it to the NFL Network. They may make a little less money, but at least their content would be on a linear network, and not relegated to the invisible realm of streaming.
06-26-2019 08:53 PM
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The Cutter of Bish Offline
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RE: ESPN can renegotiate new AAC TV deal with UConn leaving conference
(06-26-2019 08:53 PM)Side Show Joe Wrote:  If the AAC is smart they will use this opportunity to get their inventory off of espn+, and sell it to the NFL Network. They may make a little less money, but at least their content would be on a linear network, and not relegated to the invisible realm of streaming.

It would be intriguing to see the AAC suddenly make this shrewd shift at the table, but, it could lessen the impact of any loss from UConn. Like, ok, ESPN, you want to renegotiate your commitment to us. Fine. We have some other ideas and providers in mind, too, to offset what we think we’ll lose from you. We think it’s an equitable trade off. Oh, wait, you want to keep the original deal now? Ok, we’re listening.

Won’t happen, but, yeah, they should keep their lines open to other partners. But, they simply gave it away to ESPN, so it already wasn’t smart.

I just think you have members like Houston and Cincy who just don’t give a crap anymore because they know a significant shift is upon them within a decade with the Big XII, and they may as well be the next two in. AAC is going to be a mess in the years to come.
06-26-2019 09:06 PM
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GTFletch Offline
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RE: ESPN can renegotiate new AAC TV deal with UConn leaving conference
(06-26-2019 07:56 PM)Stugray2 Wrote:  Why does everybody think this is a surprise? Why does anybody expect anything other than a modest adjustment of removing UCOnn's share form the payouts, but no increase or decrease for anyone else?

It's obvious Aresco knew this was likely, as he started lobbying for Division-less football. If Aresco knew, ESPN knew. Nobody is panicking, which tells me the contingency was basically agreed to in advance. Logic says everyone will get the same money. No increase per school, no decrease either.

Does ESPN seek an adjustment based on the loss of UConn’s basketball draw (nobody knows UConn’s hoops draw like Bristol, Connecticut-based ESPN)?

Is ESPN OK with the $1 billion agreement provided the AAC replaces UConn and holds at 12 members? If so, does that prompt a “look at me!” pageant among lower Group of 5 candidates as undignified as the one a couple of years ago when AAC candidates paraded around for Big 12 gawking?

Does the AAC convince ESPN the league is worth a $1 billion contract for 11 members? Does AACs 11 mbrs $7 million annual take become $7.5 million in that case?
(This post was last modified: 06-26-2019 09:10 PM by GTFletch.)
06-26-2019 09:10 PM
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Side Show Joe Offline
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RE: ESPN can renegotiate new AAC TV deal with UConn leaving conference
(06-26-2019 09:06 PM)The Cutter of Bish Wrote:  
(06-26-2019 08:53 PM)Side Show Joe Wrote:  If the AAC is smart they will use this opportunity to get their inventory off of espn+, and sell it to the NFL Network. They may make a little less money, but at least their content would be on a linear network, and not relegated to the invisible realm of streaming.

It would be intriguing to see the AAC suddenly make this shrewd shift at the table, but, it could lessen the impact of any loss from UConn. Like, ok, ESPN, you want to renegotiate your commitment to us. Fine. We have some other ideas and providers in mind, too, to offset what we think we’ll lose from you. We think it’s an equitable trade off. Oh, wait, you want to keep the original deal now? Ok, we’re listening.

Won’t happen, but, yeah, they should keep their lines open to other partners. But, they simply gave it away to ESPN, so it already wasn’t smart.

I just think you have members like Houston and Cincy who just don’t give a crap anymore because they know a significant shift is upon them within a decade with the Big XII, and they may as well be the next two in. AAC is going to be a mess in the years to come.

If the AAC sees a sizable portion of their games relegated to espn+ (which sports media usually does not cover), I think their better members will become disgruntle, and rightfully so. It is hard to build a valuable program or conference if no one knows about it.
06-26-2019 09:12 PM
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Post: #11
RE: ESPN can renegotiate new AAC TV deal with UConn leaving conference
I am sure the UConn inventory on all sports is going to mean a large drop from the new AAC contract. So tiresome.
06-26-2019 09:19 PM
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RE: ESPN can renegotiate new AAC TV deal with UConn leaving conference
(06-26-2019 08:53 PM)Side Show Joe Wrote:  If the AAC is smart they will use this opportunity to get their inventory off of espn+, and sell it to the NFL Network. They may make a little less money, but at least their content would be on a linear network, and not relegated to the invisible realm of streaming.

This wouldn’t be an open market situation. This is just a reopening of the compensation portion of the contract based on a change in the membership triggered by the contracts composition clause. It’s basically just a contingency clause built into an agreement. It’s not an opportunity for the AAC to bring in other bidders. I’m sure there is some sort of remedy if the two sides can’t reach a satisfactory agreement during the “fair negotiations”—-likely some sort of mediation or formula based adjustment.
(This post was last modified: 06-26-2019 09:28 PM by Attackcoog.)
06-26-2019 09:26 PM
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RE: ESPN can renegotiate new AAC TV deal with UConn leaving conference
ESPN is not and will not be a passive observer in this. They talk with the AAC and will let them know if it's worth pursuing school X or not. Quite frankly ESPN will tell them straight up "add school Z", just as they told the ACC to add Ptt and Syracuse and the B12 to add West Virginia if they see a strong value. Were BYU or Army interested, that would be a slam dunk.

For ESPN I think the issues are enough good football games, a conference championship game and enough basketball inventory. The conference quality is pretty good (excepting ECU and Tulane Basketball; but since Rutgers and DePaul got their net up to 100, then these schools can get out of the high 200s and into the 100s). What they probably want is the basketball inventory to be made up, as they lost 9 conference regular season games and a tournament game. Going to 20 games would solve that. A waiver would solve the Football (first 2 years is automatic; letting UConn be an unpaid opponent in 2020 would push the issue back 3 years with the 2 year compliance waiver).

So if the above conditions are met, and ESPN looks over the field of prospects, much as they and CBS did with the B12, and decided none of those help and in fact would hurt, then they may just keep the contract as is in place, and pay the conference a little bonus to stay at 11. And I can see that happening.
(This post was last modified: 06-26-2019 09:32 PM by Stugray2.)
06-26-2019 09:31 PM
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Post: #14
RE: ESPN can renegotiate new AAC TV deal with UConn leaving conference
(06-26-2019 09:31 PM)Stugray2 Wrote:  ESPN is not and will not be a passive observer in this. They talk with the AAC and will let them know if it's worth pursuing school X or not. Quite frankly ESPN will tell them straight up "add school Z", just as they told the ACC to add Ptt and Syracuse and the B12 to add West Virginia if they see a strong value. Were BYU or Army interested, that would be a slam dunk.

For ESPN I think the issues are enough good football games, a conference championship game and enough basketball inventory. The conference quality is pretty good (excepting ECU and Tulane Basketball; but since Rutgers and DePaul got their net up to 100, then these schools can get out of the high 200s and into the 100s). What they probably want is the basketball inventory to be made up, as they lost 9 conference regular season games and a tournament game. Going to 20 games would solve that. A waiver would solve the Football (first 2 years is automatic; letting UConn be an unpaid opponent in 2020 would push the issue back 3 years with the 2 year compliance waiver).

So if the above conditions are met, and ESPN looks over the field of prospects, much as they and CBS did with the B12, and decided none of those help and in fact would hurt, then they may just keep the contract as is in place, and pay the conference a little bonus to stay at 11. And I can see that happening.

Exactly. Some keep construing the talk of sitting at 11 as saying the league is just going to ignore what ESPN tells them and the deal is completely binding as is. That's absolutely not what will happen. ESPN will have an extremely large say so in what happens, I just highly doubt they see much value in the AAC adding any of the teams aside from the obvious ones that aren't likely to say yes. Now maybe they have more interest in the AAC adding some teams out west that aren't as obvious like CSU or New Mexico so they can cripple the upcoming MWC negotiations. That would be a very ESPN move. Yes ESPN can and almost certainly will renegotiate if the AAC stays at 11, but a "fair renegotiation" is not the same as being contractually allowed to void the deal or just cut the deal in half with no consideration. I suspect if the AAC stays at 11 the total payout per team will remain very close to the original deal signed, maybe plus or minus a tiny bit, which is why you've heard the Navy AD say that any potential addition has to "add value" to the league. ESPN will be the one who tells the AAC who adds value, and baring some funky things out west I think we all know the teams that add value and the question will be are any interested? I'd guess no and therefore no one is added. Now maybe VCU gets added regardless of any addition in football because ESPN wants to replace the lost basketball inventory and they say they'll leave the total value of the deal the exact same thereby raising everyone's payout slightly. That wouldn't stun me as it's a way for ESPN to add additional content without any additional cost to them.
06-27-2019 08:17 AM
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Post: #15
RE: ESPN can renegotiate new AAC TV deal with UConn leaving conference
(06-26-2019 07:48 PM)quo vadis Wrote:  
(06-26-2019 07:22 PM)GTFletch Wrote:  Sports Business Journal’s John Ourand reports in latest newsletter that ESPN now has the right to renegotiate the terms of the 12-year, $1 billion deal it signed with the conference back in March. Ourand writes that ESPN has a clause in the contract that allows it to open up the deal if a school left the conference.

This makes perfect sense, and I posted this link earlier this morning.

But don't expect sensible replies - i got about four replies from AAC fanboys saying that this story is trumped by the Navy AD's vague tweet in response to a vague question about UConn leaving and revenue distribution.

Apparently, the Navy AD Knows All, LOL. 07-coffee3

Also the Navy AD would never spin or shade things in a manner favorable to his institutions.
06-27-2019 08:26 AM
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b0ndsj0ns Offline
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RE: ESPN can renegotiate new AAC TV deal with UConn leaving conference
(06-27-2019 08:26 AM)johnbragg Wrote:  
(06-26-2019 07:48 PM)quo vadis Wrote:  
(06-26-2019 07:22 PM)GTFletch Wrote:  Sports Business Journal’s John Ourand reports in latest newsletter that ESPN now has the right to renegotiate the terms of the 12-year, $1 billion deal it signed with the conference back in March. Ourand writes that ESPN has a clause in the contract that allows it to open up the deal if a school left the conference.

This makes perfect sense, and I posted this link earlier this morning.

But don't expect sensible replies - i got about four replies from AAC fanboys saying that this story is trumped by the Navy AD's vague tweet in response to a vague question about UConn leaving and revenue distribution.

Apparently, the Navy AD Knows All, LOL. 07-coffee3

Also the Navy AD would never spin or shade things in a manner favorable to his institutions.

He's certainly going to put the most positive spin on things as possible, but I highly doubt anything he said in that interview turns out to be factually inaccurate. ESPN having the contractual ability to renegotiate is not the same thing as having the ability to outright cancel the deal or just arbitrarily say we are slicing the deal in half. It means there will be a back and forth between the parties where they'll discuss different scenarios and they'll both have to sign off and agree to any changes. I'm sure if ESPN tries to argue something obviously stupid like losing UCONN takes away 40 million a year from the deal that there's some provision for mediation.
(This post was last modified: 06-27-2019 09:06 AM by b0ndsj0ns.)
06-27-2019 09:00 AM
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CliftonAve Online
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Post: #17
RE: ESPN can renegotiate new AAC TV deal with UConn leaving conference
There sure are a lot of fans of other programs who have a "rooting" interest in seeing the AAC get a reduction in their media deal.

Time for you all to worry about yourselves.
(This post was last modified: 06-27-2019 09:03 AM by CliftonAve.)
06-27-2019 09:02 AM
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RE: ESPN can renegotiate new AAC TV deal with UConn leaving conference
we can be sure of one thing....if ESPN ends up paying the same dollar figure yearly for 11 teams instead of 12 when those (generally meaningless and often over hyped) "look ins" come up ESPN will be sure to look in the trash can and find nothing for the AAC in terms of a raise

but really "look ins" have never been much of anything anyway so it is not like a massive raise is being put at risk

also people keep talking about UConn is about to give up $7 million per year, but that is almost certainly not true because all of these TV deals scale so a TV deal that averages $6.9 million over 12 (long) years is not immediately going to pay out $6,9 million per year and then do so for the next 12 years

it will start at a lower amount and scale to where in year 6/7 it hits the average and then in the final years pays well above that....now perhaps the AAC went the unconventional route and went for the money now and said screw the scaling (because they need the money now and JG Wentworth was not taking their calls), or because they wanted the "big splash" of $6.9 million in "P6 money", or because some teams think they will be long gone in year 7 so who cares if the deal looks really really terrible when it is paying $6.9 million per year in years 11 and 12 those teams will be gone and not their problem

but more than likely the deal scales so UConn is not giving up $6.9 million per year starting the first year of the contract and by the time the contract gets anywhere near $6.9 million in payments UConn probably believes that the Big East will have a new contract that pays them as good or better

and it is funny to hear anyone from the AAC tell everyone else to worry about their conference....uh the Big 12 called and said take your own advice and P.S. their vote in a waiver request for the CCG will be a solid NO!!!!.....enjoyed your presentations though!
06-27-2019 09:55 AM
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Post: #19
RE: ESPN can renegotiate new AAC TV deal with UConn leaving conference
(06-27-2019 09:00 AM)b0ndsj0ns Wrote:  
(06-27-2019 08:26 AM)johnbragg Wrote:  
(06-26-2019 07:48 PM)quo vadis Wrote:  
(06-26-2019 07:22 PM)GTFletch Wrote:  Sports Business Journal’s John Ourand reports in latest newsletter that ESPN now has the right to renegotiate the terms of the 12-year, $1 billion deal it signed with the conference back in March. Ourand writes that ESPN has a clause in the contract that allows it to open up the deal if a school left the conference.

This makes perfect sense, and I posted this link earlier this morning.

But don't expect sensible replies - i got about four replies from AAC fanboys saying that this story is trumped by the Navy AD's vague tweet in response to a vague question about UConn leaving and revenue distribution.

Apparently, the Navy AD Knows All, LOL. 07-coffee3

Also the Navy AD would never spin or shade things in a manner favorable to his institutions.

He's certainly going to put the most positive spin on things as possible, but I highly doubt anything he said in that interview turns out to be factually inaccurate.

Agreed. He's not going to flat out lie. "AAC divides the contract by 11 instead of 12, everybody goes to Sizzler" is almost certainly one option that the current contract provides for, if ESPN is amenable to that. AAC can certainly suggest that to ESPN.

Quote:ESPN having the contractual ability to renegotiate is not the same thing as having the ability to outright cancel the deal or just arbitrarily say we are slicing the deal in half. It means there will be a back and forth between the parties where they'll discuss different scenarios and they'll both have to sign off and agree to any changes.

Yes. And ESPN doesn't have a history of slashing these deals mid-contract, in situations where they probably could. It's not worth the pennies to them, considering the damage it does to their relationships with other leagues.

But I don't think other leagues would get the jitters at ESPN saying "The AAC per school payout stays the same with the loss of UConn." Either ESPN mandates a replacement of UConn (a warm body so that the AAC meets the numbers of games specified in the contract) or ESPN leans on the AAC to reduce the contract amounts by 1/12.

If the AAC isn't amenable to that (not gonna happen, but if), *THEN* Espn might start using the full power of their legal ability to renegotiate the deal. Partially because ESPN can say to other leagues, it was the AAC that was unreasonable here, not Bristol. You don't get raided and then get a RAISE on a contract that hasn't come into effect yet.

Quote:I'm sure if ESPN tries to argue something obviously stupid like losing UCONN takes away 40 million a year from the deal that there's some provision for mediation.

Probably so. And I don't think ESPN does that, unless the AAC spits in ESPN's face (expecting a per-school raise for getting raided).

OR, if not a mediation provision, conditions where one side can void the deal if there's an impasse.
06-27-2019 10:04 AM
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Post: #20
RE: ESPN can renegotiate new AAC TV deal with UConn leaving conference
(06-27-2019 09:55 AM)TodgeRodge Wrote:  also people keep talking about UConn is about to give up $7 million per year, but that is almost certainly not true because all of these TV deals scale so a TV deal that averages $6.9 million over 12 (long) years is not immediately going to pay out $6,9 million per year and then do so for the next 12 years

Underrated point. And the same is likely true of the Big East-Fox contract, which is entering the back half. The first years of the AAC contract are probably pretty close to the last years of the Big East contract.

But don't worry, Big East skeptics, contracts eventually end. Maybe our old deal was as inflated as you thought, and we take a haircut when it's over.
06-27-2019 10:13 AM
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