CaliWG
Water Engineer
Posts: 53
Joined: Oct 2015
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I Root For: BYU
Location: Miami
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RE: An analysis of potential AAC TV revenue by adding BYU, Boise State & San Diego...
(09-02-2020 09:59 AM)SMUstang Wrote: (09-02-2020 09:53 AM)colohank Wrote: (09-02-2020 08:26 AM)SMUstang Wrote: (09-02-2020 07:11 AM)jedclampett Wrote: (09-02-2020 01:01 AM)Fishpro10987 Wrote: [quote='CaliWG' pid='16971521' dateline='1598981921']
Let me preface this by saying that the point of this post is to maximize AAC TV revenue, so the scheduling model being used is a Rivals+SOS model. Divisions force good programs to play more bad programs than is necessary, resulting in fewer Tier 1 & Tier 2 games for broadcast partners. Under this model, each team would have 2-3 permanent rivalry games they play every year, and the rest of their conference games would be determined by the prior season's standings.
West: SDSU/BYU/Boise (SDSU/Navy)
SW: Houston/SMU/Tulsa
SE: UCF/USF/ECU (ECU/Temple)
South: Cincinnati, Memphis, Tulane
NE: Temple, Navy (Navy/SDSU, Temple/ECU)
The result of this format is that rivalry games are protected and excessive travel is curtailed. For example, in an 8 game conference schedule with one guaranteed road game vs SDSU/Boise, BYU would only have to travel east of the Rockies 3 times.
Now, the point of the SOS-based scheduling model is two-fold:
1-To maximize opportunity for a CFP bid. The disadvantage of playing in a G5 conference is that opportunities to impress the CFP committee are limited. By maximizing games against respected G5 programs (and in turn limiting games against bad G5 programs) a potential AAC Champion could have a shot at the CFP. Now, this could also backfire and result in more losses for the AAC Champ, but its a risk worth taking if it means an undefeated champ has a shot at a CFP spot.
2-To maximize Tier 1 & Tier 2 TV games. It is no secret that UCF-Boise, BYU-Cincinnati, Houston-Memphis, etc. are more attractive to TV partners than ECU-Tulsa. So the way to maximize TV revenue is to have an inventory of games with more T1 & T2 offerings. Here is the breakdown:
Tier 1: Games among the "brand" programs in the conference (including CCG): UCF, Memphis, Cincinnati, Houston, Navy (BYU, Boise)
Tier 2: When T1 teams play other "good" teams in the conference or when those good teams play each other (SMU, Temple, SDSU)
Tier 3: All other games owned by the conference TV rights
Here is a breakdown of T1/T2/T3 games under the current AAC deal (2019) that is worth $7M per team, compared to the New SOS Model:
Current: T1=18, T2=9, T3=46
New: T1=27, T2=29, T3=29
By going to the new model the AAC would have as many T1 games as they have for T1 & T2 combined currently. And the total number of T1 & T2 games would double, while significantly decreasing the number of T3 games. This is how a conference increases its TV revenue. Under this model the AAC could offer quality content to fill Thursday night, Friday night, and two Saturday slots. Which brings us to the next way the AAC could be increasing revenue.
The additions of BYU, Boise & SDSU bring a brand new broadcast window (10 EST) for the AAC TV partners. And this is the importance of having all 3 programs in the AAC, to solidify the window on a weekly basis. Right now the Pac-12 owns this time slot, but they are exclusively regional. In the AAC you will have east coast and central teams playing in the late games as well, meaning more national interest.
So, let's look at some numbers
Current AAC TV Revenue: $83M/yr ($12.5M/yr for BB/other sports) = $71M/yr for football only or $5.9M per team
The core value of a TV deal is the conference's inventory of T1 & T2 games (T1 = 58%, T2 = 29%, T3 = 11%)
>Under the current AAC TV deal, partners are actually paying the same for T1 & T2 games because there are so few T2 games (approx $2.3M per game)
>Using the same flawed payout for both T1 & T2 games, the new total of the FB Only Deal would be $130M or $9.3M per team
>However a more fair analysis of the current numbers would be $3.5M for T1 games & $1.6M for T2 games, which results in $161M or $11.5M per team
Now $11.5M per team ($12.5 for BB members), is a nice increase for the conference until you consider what adding BYU & Boise do for the AAC's positioning and branding. Currently the AAC calls itself the "P6" conference, but they're constantly looking over their shoulder worrying about another G5 champion stealing the NY6 bid. The additions of BYU, Boise & SDSU eliminate this concern. Not only would the AAC be bringing in Boise (its only consistent threat for the NY6 bid) to the conference, in BYU they'd be adding a program with a history and tradition that extends well beyond the current core of programs in the league. And the AAC would be cementing itself firmly above the rest of the G5. Here is one way to measure the impact of adding BYU, Boise & SDSU to the AAC:
Current attendance by conference: Pac 12=46k, AAC=29.5k, MWC=23K
Adjustment based on realignment: Pac 12=46k, AAC=33.5k, MWC=21k
>And this is before any natural bump from an increase in quality games
So the AAC will go from solidly above (but still among) the G5s in attendance to solidly apart from the rest of the G5s in attendance, and actually exactly between the lowest P5 and the next highest G5. TV revenue should reflect this positioning. The Pac-12 distributes $29.5M annually and the MWC just signed a deal worth $3.75M annually. Based on those numbers the AAC should be at about $16.6M per team under this model, but $15M per team for football only seems like a fair number for a conference without the official designation as a "power" conference.
A conference with quality competition, protected regional rivalries, a TV payout in the neighborhood of $15M/yr, and a virtual guarantee of a NY6 bowl for winning the conference title seems like a great position for this group of programs to be in. Not to mention under this model the AAC could likely get 2-3 quality 2nd Tier bowl games in its lineup (Holiday, Liberty, Tangerine).
Good report. Your job is to get BYU to the table.
Agree. Good work!
Further, $15M/yr. is just the starting point. By 2032, an arrangement along these lines should generate the kind of revenue generated by the P5 conferences. In addition, ESPN has the lawyers, the power, the contacts, and the exact formula to turn an expanded AAC into an official NCAA autonomy and power conference.
BTW, would it have to be BYU, Boise, and SDSU? Not necessarily. Air Force and Appalachian State are of similar quality.
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As much as I like Air Force and Appalachian State, I agree with CaliWG that BYU, BSU, and SDSU would bring the AAC a strong California presence and therefore strengthen the conference the most.
Adding BYU* and Boise would add a Utah and Idaho presence -- two low-population states with no recruiting potential. Adding SDSU would add a California presence, but nothing so strong as that of the existing Pac 12 teams.
*Yes, there's some LDS interest nationwide, but not on a Notre Dame scale.
Check the BYU and Boise State rosters and see how many California players they have. Plus BYU put their Olympic sports in a California conference.
Nearly half of Boise's scholarship players & nearly a fourth of BYU's scholarship players are from CA. The goal should be to expand the AAC's recruiting footprint, not dilute its existing footprint.
Not to mention, SDSU is on the way up. The new stadium is a coup for that program, especially now that they don't have a direct NFL competitor in that huge market anymore. And Socal recruiting is about as good as it gets anywhere in the country. Adding SDSU would be a boon to the conference. And having members in FL, TX, CA, OH & LA creates a distinct recruiting advantage as a G5 conference that none of the P5s even have.
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