Larry Scott: Pac-12 in Great Shape

[Buffnik]

http://www.azcentral.com/story/sports/college/2017/05/05/working-do-not-post-yet/311043001/

"Reading about the success of the SEC Network and the Big Ten's new TV deal, there's fear of falling behind in the future," Scott said during Pac-12 meetings this week in Phoenix. "I certainly feel a lot of pressure from our campuses to do anything we can within reason and consistent with our values to keep generating more money and being aggressive. But from a macro perspective long term, I think we're in great shape."

Whether the schools agree is open to debate. Jon Wilner of the San Jose Mercury News estimates that the conference distribution gap between the Pac-12 and Big Ten/SEC will be $10 million or more per school through 2023-24, when the Pac-12 will negotiate its next major media rights deal.

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I think that 2023-24 is what we need to watch closely. Pac-12 is going to need to make some moves to better position itself for whatever the new reality is at that time. Will it be cable & satellite distribution and getting into a larger geography of "conference footprint" still be the driver? It certainly seems that the cash windfall within the current bubble is facing a new reality.

 

[DBT]

So, CU will fall $70,000,000 behind the likes of 'braska? Will the '24 plan ever make that up?

 

[4DemBuffs]

$10 mil per school per year and everything's cool? Huh...

 

[Bufffan68]

$10 mil per school per year and everything's cool? Huh...

Right?!? Ugh.

 

[Buffnik]

Big 12 deal runs through 2024-25, which puts them one year beyond the Pac-12. If there's an expansion plan for getting new revenues and the deal we want, the conference may have to invest in stealing a team or teams a couple years early. And Big 12 schools are now making about $28M a year (about the same as Pac-12 schools at just $1M more).

What I wonder is whether we want to change the culture of the conference dramatically by getting into the farm belt and east Texas. Maybe all we should do is look to bring Texas Tech over? They might be able to bring the conference into Texas in much the same way that Texas A&M did for the SEC. If they immediately got a full share and a 2nd school got a partial share (growing into a full share over time), the numbers probably work. I think TTU + UNM would maintain culture of the conference and be pretty appealing to TTU fans who have historical ties to CU, UNM, UA and ASU since we've been in the same conference in the past. (UNM has been in the same conference as UA, ASU, TTU & UU in the past.) Both are Tier 1 research. Both reflect an aspect of western culture. I think it might be the move to make. And I think there's a deal there to be made with the Big 12, because I believe the members would feel they could replace TTU with Houston and maybe even gain from the deal due to recruiting grounds/ local market competition with the SEC.

 

[Buffnik]

Found a piece by a Stanford writer in November calling for adding Boise State and San Diego State (the 2 most valuable MWC programs) or maybe BYU. http://www.stanforddaily.com/2016/11/02/mather-the-pac-12-should-expand-again/

Interesting thought with that is what he's saying about owning the west, which those programs prevent these days. I think the strongest would be Boise State and BYU if that could politically happen. I don't know how anyone could argue against those two athletic departments immediately making the Pac stronger and more appealing to audiences.

 

[Bufffan68]

Found a piece by a Stanford writer in November calling for adding Boise State and San Diego State (the 2 most valuable MWC programs) or maybe BYU. http://www.stanforddaily.com/2016/11/02/mather-the-pac-12-should-expand-again/

Interesting thought with that is what he's saying about owning the west, which those programs prevent these days. I think the strongest would be Boise State and BYU if that could politically happen. I don't know how anyone could argue against those two athletic departments immediately making the Pac stronger and more appealing to audiences.

I don't know if BYU culturally or politically matches the very progressive schools of the PAC12...but when $ is involved anything can happen.

 

[89BUFF89]

how people pay for and consume content will be even more different then, 5G should be up and running, streaming will only be larger and traditional sat and cable delivery not so much. the industry is changing so rapidly hard to predict that far out imho.

 

[Big Jim]

how people pay for and consume content will be even more different then, 5G should be up and running, streaming will only be larger and traditional sat and cable delivery not so much. the industry is changing so rapidly hard to predict that far out imho.

In the meantime Scott rat ****ed the Pac-12 by making sure that they own 100% of not much rather then getting national distribution for the network.

So in 7 years they will be another $70M behind per school on tip of the $25M the conference schools are in the past several years. Yet Scott still sells his bull**** that they are "set up for the future".

 

[BerkeleyBuff]

And Big 12 schools are now making about $28M a year (about the same as Pac-12 schools at just $1M more).
.

I think the Big 12 is actually in better financial shape right now, as that $28M doesn't include their tier 3 rights, since each team sells their individually. So UT is making $43M, OU about $36M, and the others varying amounts down to about $30M.

 

[Buffnik]

In the meantime Scott rat ****ed the Pac-12 by making sure that they own 100% of not much rather then getting national distribution for the network.

So in 7 years they will be another $70M behind per school on tip of the $25M the conference schools are in the past several years. Yet Scott still sells his bull**** that they are "set up for the future".

I get that POV. It's frustrating.

However, I've been thinking about what would have happened if the Pac-12 would have taken the SEC approach for forming a network. ESPN owns it and each SEC member gets $40 million a year. I actually think our situation is better than that the alternative. ESPN wouldn't have paid each Pac-12 school $40 on the license. We'd probably have ended up with around the same $27 million per year. And we wouldn't have owned it.

The problem isn't really the deal structure. The problem lies with the fact that no one east of Denver could give a sh!t about Pac-12 games unless it's an ESPN/FS1 game of the week or the conference championship... and the markets from Denver west aren't passionate enough to drive deals. That last part is why I believe there's logic in creating better content and owning the west by biting the academic bullet on BYU and Boise State. Excellent ADs with passionate fan bases along with being name programs nationally.

 

[onealcd]

Could be wrong but I think the first reliable streaming service that offers a sports only package is going to rake in the cash because almost every bar would love to have that and just have comcast up their internet quality. I would think the PAC 12 would be included in that no questions asked, no matter if we have an equity partner like Espn, fox, at&t.

 

[SINKRATZ]

I get that POV. It's frustrating.

However, I've been thinking about what would have happened if the Pac-12 would have taken the SEC approach for forming a network. ESPN owns it and each SEC member gets $40 million a year. I actually think our situation is better than that the alternative. ESPN wouldn't have paid each Pac-12 school $40 on the license. We'd probably have ended up with around the same $27 million per year. And we wouldn't have owned it.

The problem isn't really the deal structure. The problem lies with the fact that no one east of Denver could give a sh!t about Pac-12 games unless it's an ESPN/FS1 game of the week or the conference championship... and the markets from Denver west aren't passionate enough to drive deals. That last part is why I believe there's logic in creating better content and owning the west by biting the academic bullet on BYU and Boise State. Excellent ADs with passionate fan bases along with being name programs nationally.

I agree with your diagnosis, but do you really see Boise State as an excellent AD with a passionate fan base? Maybe they are passionate locally, and they have been a curiosity nationally while their football team has been good, but they are a very small market team that gained some attention from the novelty of the blue turf combined with an incredible run in the last decade or so. They've always struck me as a program that is a couple 7 win seasons from going back to being a cute mountain program with fun uniforms and blue turf. I just don't see the college football equivalent of Gonzaga basketball as realistic.

 

[onealcd]

I agree with your diagnosis, but do you really see Boise State as an excellent AD with a passionate fan base? Maybe they are passionate locally, and they have been a curiosity nationally while their football team has been good, but they are a very small market team that gained some attention from the novelty of the blue turf combined with an incredible run in the last decade or so. They've always struck me as a program that is a couple 7 win seasons from going back to being a cute mountain program with fun uniforms and blue turf. I just don't see the college football equivalent of Gonzaga basketball as realistic.

Yeah but the PAC has the markets, its just oversaturated. The sec has small markets but they are unsaturated and the whole market is college dominated.

 

[Buffnik]

I agree with your diagnosis, but do you really see Boise State as an excellent AD with a passionate fan base? Maybe they are passionate locally, and they have been a curiosity nationally while their football team has been good, but they are a very small market team that gained some attention from the novelty of the blue turf combined with an incredible run in the last decade or so. They've always struck me as a program that is a couple 7 win seasons from going back to being a cute mountain program with fun uniforms and blue turf. I just don't see the college football equivalent of Gonzaga basketball as realistic.

I do see them that way. And, hell, they've had a winning record against the Pac-12 in football this century, they've got a respectable hoops program and they're already a conference member in wrestling.

 

[SINKRATZ]

I do see them that way. And, hell, they've had a winning record against the Pac-12 in football this century, they've got a respectable hoops program and they're already a conference member in wrestling.

Fine but if we think the problems are that no one east of Denver gives a sh!t about Pac 12 games, and the markets west of Denver aren't passionate enough to drive deals, how does Boise help with that? They're a small town program in a tiny media market that the national media only cares about if they're in contention for the BCS playoff.

Honestly, and I know I'll get crushed for this, but I'd rather add CSU & BYU than Boise. CU and Utah was always a forced rivalry and now we'd both have much more natural rivals and travel partners. They've got a new stadium that can be expanded and I think it would raise the level of interest in HS and college football in the state to have 2 P5 programs.

 

[Buffnik]

Fine but if we think the problems are that no one east of Denver gives a sh!t about Pac 12 games, and the markets west of Denver aren't passionate enough to drive deals, how does Boise help with that? They're a small town program in a tiny media market that the national media only cares about if they're in contention for the BCS playoff.

Honestly, and I know I'll get crushed for this, but I'd rather add CSU & BYU than Boise. CU and Utah was always a forced rivalry and now we'd both have much more natural rivals and travel partners. They've got a new stadium that can be expanded and I think it would raise the level of interest in HS and college football in the state to have 2 P5 programs.

I just don't know about the economic realities.

 

[8Jah]

It's not the structure of the deal...just reflection of the culture in the different conference regions. The SEC an BIG10 are just going to have bigger payouts. Not much you can do in the short term.

Best thing for our conference $ is a dominant USC.

 

[SD Buff]

I think the Big 12 is actually in better financial shape right now, as that $28M doesn't include their tier 3 rights, since each team sells their individually. So UT is making $43M, OU about $36M, and the others varying amounts down to about $30M.

OU doesn't make anywhere close to 8 million on their Tier 3 deal. They get an average of 4 million a year for rights over 10 years and another 1.8 million in expense reimbursement for running sooner sports. And I'd bet their cost is higher than 1.8 million a year.

Boren has been on record they make about 2 million a year after expenses. The rest the big 12 makes less. The year cbs sports decided to try and read KSUs gross income and reported it as net while adding radio.... They said they make tens of dollars on T3.

I don't trust anything coming from the Big 12. They're set on appearances and this year just found money laying around to distribute.

I agree they are doing fine. They run the conference as a business. But still not the least bit stable.

As for BYU and Boise State. We'd be talking a complete 180 by the PAC to even consider those schools, let alone invite them. Don't see it ever happening.

 

[Bufffan68]

Best thing for our conference $ is a dominant CU.

FIFY. LOL!

 

[Big Jim]

The problem isn't really the deal structure. The problem lies with the fact that no one east of Denver could give a sh!t about Pac-12 games unless it's an ESPN/FS1 game of the week or the conference championship.

Put the money aside, the answer to getting people east of Denver to watch Pac-12 football is not to refuse to get national distribution for the P2 network. No DTV just enhances the image of a conference that doesn't care about being prime time.

 

[89BUFF89]

Put the money aside, the answer to getting people east of Denver to watch Pac-12 football is not to refuse to get national distribution for the P2 network. No DTV just enhances the image of a conference that doesn't care about being prime time.

PAC needs to actually beat the top teams in those other conferences, win a natty or two, to be taken seriously. Not being able to win those games and all the late starts means people don't go out of their way to watch.

 

[89BUFF89]

Having QB Heisman hype doesn't hurt

http://www.nfl.com/news/story/0ap30...f76604362&utm_source=t.co&utm_medium=referral

 

[Buffnik]

Great stuff from Andy Staples.

Here are the conference commish quotes:

“I really see a time when there are going to be a lot of players in the marketplace and there are going to be a lot of distribution methods,” Big 12 commissioner Bob Bowlsby said. “The unknown is how much is it all worth? I don’t think there’s anyone who legitimately knows what it’s going to be worth.”

“I don’t think anyone knows exactly what the landscape will look like or what health ESPN or Fox will have in 2023 when we’re negotiating or how significant a player a Twitter or a Facebook will be,” Pac-12 commissioner Larry Scott said. “My sense is that there will be more competition. There will be more and different types of players. And there will still be very limited and highly valuable sports properties.”

“Long-term, I’m very bullish on the value of premium sports rights,” Scott said. “I see more competitors. And frankly, competitors with bigger market cap than ESPN or Comcast or DirecTV. Some of these companies we’re talking about are huge by comparison. If they decide that sports is a vertical they want to get involved in in a big way, that’s good news for the Pac-12 or the NFL.”

“There’s no doubt we’re in a disruptive environment,” [Big Ten Commissioner Jim] Delany said. “There definitely is money and interest on the sideline. It really hasn’t emerged very much yet, but I’m sure that there is—whether it’s Apple or Google or Hulu or any number of companies.”

“If you go shorter [length of deal], you take out a little more risk,” Delany said. “But you also have a little more upside.”

“There’s anxiety in our conference, but I think it’s more about the future,” Scott said. “We’re reading about the success of the SEC Network and the Big Ten’s new TV deal. There’s fear of might we fall behind in the future. But sitting here today, we’re in great shape.”

“We could be right, or we could be wrong,” Delany said. “History will tell us.” [on whether these new media players have as deep or deeper pockets]

 

[BuffNut99]

The best thing the Pac 12 has going for it is that it owns 100% of its own network and content. Larry needs to get us on to these new platforms (Youtube TV, Sling, etc.), but he's probably asking for too much (Direct TV tactics), and I don't think the demand is there.

 

[sackman]

Owning 100% of the network is looking smarter and smarter. We haven't tied our ship to a sinking ship like espn.

How does that translate? I don't know, but it for sure gives us more options than the SEC or B1G has. ESPN is going to do everything it can to remain relevant, and that could be bad news for those conferences. Distribution on a non ESPN supported platform like Hulu or amazon might not be so easy.

 

[Buffnik]

Owning 100% of the network is looking smarter and smarter. We haven't tied our ship to a sinking ship like espn.

How does that translate? I don't know, but it for sure gives us more options than the SEC or B1G has. ESPN is going to do everything it can to remain relevant, and that could be bad news for those conferences. Distribution on a non ESPN supported platform like Hulu or amazon might not be so easy.

Big Ten is Fox, so that can also make it challenging if Disney/ABC/ESPN try to go it alone with their own sports platform.

 

[Big Jim]

The best thing the Pac 12 has going for it is that it owns 100% of its own network and content.

Owning 100% of the network is looking smarter and smarter. We haven't tied our ship to a sinking ship like espn.

By the time the current contracts are up, the Pac-12 schools are going to have earned about $100,000,000 less in revenue PER SCHOOL. How is Larry going to pluck a rabbit out of his ass and make up that lost revenue?

 

[Buffnik]

By the time the current contracts are up, the Pac-12 schools are going to have earned about $100,000,000 less in revenue PER SCHOOL. How is Larry going to pluck a rabbit out of his ass and make up that lost revenue?

I thought you had agreed that a deal similar to what the Big Ten or SEC did wouldn't have netted more money for the Pac-12 because our conference isn't worth as much to Fox/ESPN as they are.

 

[Big Jim]

I thought you had agreed that a deal similar to what the Big Ten or SEC did wouldn't have netted more money for the Pac-12 because our conference isn't worth as much to Fox/ESPN as they are.

I don't believe I agreed to that or anything close to that. I certainly don't remember agreeing that the Pac-12 is worth $100M less per school over a ten year period or that Scott has done much of anything right when it comes to Pac-12 media management. That guy can't get national distribution on the largest subscription service in the world so I don't understand how he can be lauded for being smart in keeping 100% of not much.

Too often if seems like fans of an institution rationalize the poor performance of that institution in college athletics. It sure feels that way when it comes to monetizing, or in this case not monitizing, the Pac-12 media rights. So Scott is a pioneer in the media rights business, great. You know what happens to pioneers? They get shot in the back with arrows.