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Hurtlocker

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Everything posted by Hurtlocker

  1. They already are.
  2. Ha, yeah, the irony being we likely have more teams involved now than less. Even if the Big Ten and Big 12 split the Pac 12, the remaining P4 will still run the show. They'll just not share it with the "G5" any longer. If you got rid of all conferences and said, "You need to spend $100m in athletics a year to join this tier" I would guess less than a handful of teams from the current P5 wouldn't ante up. And those that already spend more than they make would find a way to spend more to join because the exposure for their university is too great to lose out on. It becomes a marketing expense.
  3. Blue bloods do have larger fanbases largely due to building generational fans with consistent success over decades. That being said, all it gives them is a higher potential audience. A 6-6 blue blood or a blue blood playing in a game they're getting smoked draws terribly. In the reverse, a non-blue blood with a great winning season will out draw the blue blood, especially if its a competitive game going into the 4th. They lack the casual fans, however, who like the team because their parents liked the team, etc. 90% of ND's fans never attended the school. Hell the entire town of Beverly IL, home of the Southside Irish Parade, bleeds gold and most went to Eastern Illinois. That's what a blue blood gets you. Consolidation will not help everyone though. The benefit to putting big brands into the same conference is that you can guarantee someone will be good. So for network executives, they're giddy. If Bama has a bad year, someone will have a good one. The Big 12's demise is a good sign of this. Its only been OU for a decade. For TV networks that's not much to hang a hat on. You had two, and got one. So if 50% is your number, having 6 is better than 2, because now 3 will carry water for the rest. Advantage: Networks However, with 9 conference games that gives sixteen-team league 72 losses to spread around. While in any given year 2-3 will be elevated to gods, 13-14 will be taken out of commission. They'll be paid to be fodder, even blue blood fodder as a 6 win Georgia won't demand the audience it does when it has 11 wins. Oklahoma and Nebraska's brands are built on perennial 10 win seasons after beating the tar out of whatever conference's version of the Washington Generals exists. Even with a playoff performance like Cincinatti. Those years are likely to become much more difficult and rare. And, much like Nebraska, you'll start to see a degradation of brands as much as you'll see an elevation. The money is good. The exposure is outstanding. But the bar is still 10 wins a year to stay in the conversation, so the stakes are much, much higher.
  4. Streaming surpasses cable as top way to consume TV Streaming has officially topped cable as the most popular method by which Americans consume television content, according to new data from Nielsen. Why it matters: Just as cable's victory over broadcast ushered in waves of change to U.S. media, streaming's rise will continue to bring new businesses and cultural forces to the fore. Details: Streaming now makes up more than one-third of all television consumption in the U.S., according to data from Nielsen's monthly Gauge study of TV consumption. Netflix continues to be the top streaming platform, taking 7.7% of total share of TV consumption in July. YouTube, Amazon Prime Video and Disney+ increased their share of viewing time last month to 7.3%, 3% and 1.8%, respectively, while HBO Max held steady at 1%. Yes, but: Traditional TV, which includes both cable and broadcast consumption, still collectively makes up the majority of TV viewing in the U.S., for now. But if the rate of these categories' decline continues, streaming could very well surpass traditional television as the primary way Americans consumer TV content in the next few years. While the total amount of TV consumption has remained consistent in the past year, the amount that Americans have streamed has increased 22.6%, compared to declines in cable and broadcast of 8.9% and 9.8%, respectively. What to watch: With more live sports rights moving to streaming, that trend seems likely. Nielsen noted that sports viewing drove the biggest decline for cable.
  5. I think to make the numbers work for NBC they'd get whatever ND game existed, always at 3:30, away or home. The only way to guarantee those is if they have a Big Ten conference slate. So if they play Stanford at Stanford or Maryland at Maryland or Iowa at ND, always on NBC at 3:30. The double header would be a west coast Big Ten match up or a big prime match up, depending on who picks when that week. That would be worth a lot for NBC.
  6. Having three time zones, having a year longer to figure it out, and the Big Ten's desire to destabilize the Pac 12 are putting the Big 12 in a much better spot than the Pac right now. My guess: All talk of B1G expansion is focused on ND, funded by NBC and pushed by USC, aiming for 2025. Unwilling to give up a lifeline, Oregon/Washington/Stanford/Cal want special out clauses with Pac 12 Four corners say, "Fuck off" and join the Big 12 in 2024, prior to Big 12 media deal. Big Ten gobbles up whatever of the four it wants with ND and, if any are not taken, they join the Big 12. These additions are paid for via a bump for the NBC prime (due to west coast ND away games) and ESPN picking up the Pac primetime package of new inventory, aka Pac12 after dark, with Big Ten Teams playing the West Coast, at the 10pm est/7pm pst slot. ND pays $50m to get their Olympic sports back, which all move to the Peacock. Oregon State and Washington State are MWC bound Big 12 and Big Ten work an OOC scheduling agreement with Fox/CBS, ACC/SEC follow suit with ABC Playoff is rebuilt after P4 breakaway with 16 teams, 4 auto and 12 at-large. Three stadiums in footprint (two for first round, 1 for quarters) per each conference, Semi/championship bid out like today. Money split: 60% evenly between all 4, 40% split based on participation. Estimated per team after its all said and done: B1G = $90-105m SEC = $85-100m Big 12/ACC = $65-75m
  7. That would probably cause the Four Corners to take the Big 12 to 16 too.
  8. Yeah it won't be that much, $5-10m? Maybe. That increase has to involve expansion, so you'd have: $1b / 16 = $62.5m/team $1.4b/20 = $70m The SEC will be in that ballpark. They'll both make the same off the playoffs and the NCAA and all that crap. The only difference is will BTN provide a greater benefit due to the equity stake than the SEC has with the SEC Network. If the SEC makes $10m less per year, but gobbles up all the exposure, gets the best talent, and keeps winning, who the fuck cares?
  9. They only release like a quarter of the details, so it's always hard to tell for sure off a press release. We won't really know until around the summer of 2025, when we can see AD revenues for the 2023-24 season. Until then though, let's speculate! Big Ten The $60m they were being paid prior was for all revenues paid out by the Big Ten, so around $840m a year. This included T1, T2, T3, any BTN ownership revenue, NCAA payouts, post season, equity sale for 10% of BTN to Fox, etc. What we're seeing released today is just their new T1/T2 package. The 7-8b escalators are standard practice, basically the 4% year-over-year increase to keep from losing value to inflation. It's not really that you're paid more, it's just that what you can buy for $100m in year one is the same as what you can buy for $104m in year two. With this, and it being a 7 year deal, year four is the baseline, at $1b a year. Y1 will be worth $885m and Y7 will be worth $1.1b. This nets out to be about $55-70m per school over the run. This potential $2B increase, from $8b to $10b is an interesting wrinkle. I guarantee you this is the ND rider. NBC wants ND to go against bigger brands all year to maximize their audience, which has been shrinking since the ACC deal. At about a quarter billion a year, the only thing it could be is ND and a friend, likely Stanford for NoCal and academic fapping, which breaks down to $71m/school in Y2 (2025 when ND would join) and $88m/school in Y7. BTN is a bit muddier to figure out. In the past the Big Ten owned half and they split up profits at the end of the year. If the channel made $280m, each school got $10m, after Fox took half. We can fudge their revenue in a moment, but the LA market paid off big for Fox in BTN. I would guess they're going to increase their carriage in SoCal alone by nearly $120m per year. That's a big nut. So, cable channels make money with carriage or affiliate fees or whatever you want to call charging the distributor $X per subscriber per month to carry the channel. There are sort of three rates, the in market rate, which is specifically what DMA you reside and then out of market rate. Sometimes you can get a wider area rate, (like $1/m/sub in DMA and $0.4/m/sub in state and $0.2/m/sub OOM, as an example), but let's not overly complicate it. For BTN, OOM is 14-20% of Market. I don't feel like running all the numbers right now, so let's say they're in 80m homes and 30m of that is in market. They'll make $65m a month in fees alone. Advertising generally makes up about half of total revenues, that means BTN is making $130m per month. After expenses, and Fox taking 61%, the Big Ten likely makes around $15-25m per year per team (at 16) off the BTN. Let's say $20m, so now we're at $75m - $90m per team per from Y1 to Y7 for T1/2/3 properties, which will also go up with post season and NCAA. SEC The SEC is a bit different. ESPN bought all of their inventory. Literally bought it. The SEC does not have an equity stake in the SEC Network. It is an ESPN construct to dump inventory and increase their carriage across all ESPN owned channels. The one you mentioned is for their T1 games and was a 10-year deal at $300m a year in year 5. So in Y1 that's $250m (or around $18m/school) to Y7 at $365m ($26m/school) They also own the rights to their T2/3 on a 20 year deal that started in 2014. I can't find the price quoted, but the SEC paid out $40m per school two years ago for just the media deal, and part of that was the $55m that CBS paid. Due to that I'd guess they made $36m/school on the deal....or about $500m/year. Fast forward that to 2024 and you have a pay out of about $850m/year on T1/2/3, or $60m per school per year. What hasn't been announced is how much Texas and OU will increase the totals. We do know that they won't be a part of the SEC network. OU signed a separate T3 agreement with ESPN for SoonerVision and, obviously, there is LHN. For the SEC then, I'd guess you'd see a $150ishm bump, making the total revenue around $1b in 2024. The per team payout is a bit wonky, because Texas/OU only have T1/T2, but it ends up pretty close to $65-70m/school/year. At the end of the day, its just trading paint though. Money keeps you in the game, you can't win without it, but there comes a point where you just can't spend all you have. The money Texas makes from moving to the SEC won't really do jack for its finances. I mean more is good, but are they going to build a second football stadium? No. Who it helps most is Indiana, Vandy, Kentucky, etc. All of those teams will start to separate from the ACC/B12/P10 in facilities even more. What matters most, and why realignment really happened, is exposure. Exposure is brand marketing, and it is work waaaaaay more than revenues. It is like playing with house money if you get it. Exposure is recruiting. Kids want to go where they'll be seen. So what is really at stake here isn't is the Big Ten getting a few million more per team, it is which media deal will gain the most exposure; the Big Ten's NFL approach, or the SEC being all in on the Worldwide Leader's spin machine? I'd not bet against ESPN, unless the Big Ten lands ND.
  10. Chicago is a Big Ten and ND town. Only so many kids can go to Illinois, so Chicago feeds all the major universities in the area, including Michigan State, Indiana, Purdue, Wisconsin, and Iowa. On Saturdays, its what's on all the TVs in bars.
  11. Likely doesn't include BTN revenue either, so its $1b a year just for the Fox/NBC/CBS deal.
  12. I don't, but they are giant schools, in heavily populated areas, with generational alumni dating back a century. The SEC is new money compared to the Big Ten.
  13. It doesn't make a ton of sense though. The reason you "buy in" is because you come in the middle of a contract and everyone gets less growth to pay for you. Like for the new kids in the Big 12, they may get a bump because of more inventory, but basically everyone is shaving their 4% riders, adding it up, and splitting that batch of money with the new 4. But, the Big Ten is in the beginning of a contract that Fox controls and they're selling a ton of big match ups. Oregon/Ohio State is worth more to Fox/NBC/CBS than Indiana/Ohio State, hell Oregon/Washington is worth more than that. If they'd bring them in, they'd bring them in now. The only reason to not bring them in is if Notre Dame is paying for them. Washington, Oregon and either Stanford or Cal would be about the same value paired with ND, so its who do they want. Long story short, if you come in at the beginning at half off, you'll always be half off or everyone else will get less the next deal. With 61% ownership, DMAs do matter to Fox with BTN and, with this new deal, they'll have a lot of BTN content. LA paid for UCLA, USC paid for itself as a brand. I guarantee you you'll see a lot of UCLA's football/basketball games on BTN and USC's on Fox. Oregon's DMA is tiny, so it needs to be valued as all national brand. Washington likely makes $75m and the Bay area could do that with one team. The four corners schools are fucked regardless. Doesn't really matter what they do now. The top end valuation is probably Big Ten growing to 18 with ND/Stanford and then stopping. Taking Oregon/Washington to 20 is, worth less, but they only two other schools that even may make sense. The remaining top 4 joining the Big 12. (my guess is Oregon, Washington, Cal, and ASU - but I can see them going to 18 to get Colorado and Arizona or taking those two if Oregon/Washington bolt) Everyone else boosts the MWC
  14. Fox can get them cheaper by them being in the Pac10/Big12. Why pay $100m for someone you can get for $50-70m? ESPN has some shoulder property for the SEC with the ACC, but could use more. Fox bought the best Big Ten game, but needs shoulder property for the other time slots. Whoever has the in with Fox I think wins this battle and the Big 12 is a bit more protected in the moment with a Gor through 2025. So does Fox want to consolidate the properties it wants in the Big 12 or keep two afloat? I'd guess if they consolidate, you'd see a 15-25% premium. More if Fox also creates a linear channel for that entity to market next to the Big Ten Network.
  15. Pac-12 Networks: The rise, fall and future of a conference TV dream TLDR: PacNet was a tech and content pioneer Dropped the ball on carriage and not having leverage (Fox/ESPN/NBC/etc) to go national Dropped the ball on not putting featured games on PacN to push subscriptions Never could recover from failed Direct TV negotiation Tons of expense, next to no profit Covid accellerated the ending, liking shuttering soon I highly doubt the Pac12 Net will survive this media contract, because the Pac, to stay even with the Big 12, will need to sell the inventory it currently is putting on the Pac12 Net. With nothing of value left on the channels, there isn't a reason to exist.
  16. Haha, we're focusing on the wrong thing here. More schools equates to a lower starting point in a buyout negotiation.
  17. What I meant was the exit fees will be lower for Texas and Oklahoma with the four new ones, not that they'll get a cut. Made up numbers: $500m / 10 schools = $50m/school $500m / 14 schools = $36m/school Texas and OU's baseline just dropped from $100m per school to $72m.
  18. Well, think of it this way: The exit fee is two years of withheld revenue Adding 4 programs increases the number of mouths at the table That reduces the per team averages paid out by the Big 12 Exit fee is reduced by 28.5%
  19. That's still a GoR.
  20. I still contend the move was about negating a recruiting advantage the SEC had picked up in Texas. It will be interesting to see how pissed off they'll be a decade from now, after a falling into the familiar 8-win ceiling with nothing unique to sell but a brand of crazy that has worn thin on the rest of the conference.
  21. I think we have a winner
  22. Fox alternates Big 12 pics with ESPN, so they'd need to be made whole too.
  23. The bylaws were completely rewritten in 2012 after this, because it was extremely easy for Colorado, Nebraska, Missouri and A&M to leave. I think Nebraska played like $9m.
  24. "The University of Texas at Austin and The University of Oklahoma notified the Big 12 Athletic Conference today that they will not be renewing their grants of media rights following expiration in 2025. Providing notice to the Big 12 at this point is important in advance of the expiration of the conference's current media rights agreement. The universities intend to honor their existing grant of rights agreements. However, both universities will continue to monitor the rapidly evolving collegiate athletics landscape as they consider how best to position their athletics programs for the future." Joint statement in a release July 27th last year, the SEC invitation was announced two days later. My point was more the difference between notice date and effective date and I agree with you that we don't technically know the exact date of notice, but I would imagine by the language in those reseases that the rest of the Big 12, which constitutes a super majority with 8, wasn't needing something printed on scented paper to arrive. It wouldn't take much effort to initiate "thanks for letting me know you're leaving, you can't tell me who to date any longer" This made my day.
  25. bylaws.pdf (big12sports.com) See Section 3.5. I think you're confusing effective date with notice date. Effective date is so you can't cut out within the middle of a media year (July to June), notice date is the date, well, word got out. Each school has a voting director and that director ship is vacated on notice. Sports boards and contract law shouldn't mix, because any contract can be renegotiated. However, Sovereign Immunity seems to be a Macguffin in regard to realignment. It isn't like claiming Diplomatic Immunity as a South African gunning down half of Los Angeles. Texas governmental entities, e.g. public universities, are still bound by the contracts they sign. They're just shielded from lawsuits where they are not found breach of contract. If a contract you sign has no validity, then a lot of things start to go bad. What banks would fund a major stadium expansion if anyone could break the deal at any time without repercussion? The credit rating for those bonds would be junk, at best. I've seen GoR's used extensively in the entertainment field (Artists, Production studios, etc) and I've never come across one tossed out or broken. Ever heard those stories where an artist had 5 more albums to make for a certain record company before they could get out from under the thumb of the man? Yeah, those are because of grant of rights. They are, however, negotiated and sold, frequently - by the holder of said rights. The reason Sony keeps making bad spiderman movies, is because their agreement on the right to Spiderman requires them to keep churning out movies on a set schedule or the rights flow back to Marvel. Speaking of Marvel, the reason the Hulk has only been a cross over character in all the major MCU movies is because of restrictive rights on the character's use and Marvel didn't get those rights that were granted back until recently. These GoRs are basically how all creative works get monetized, it is not just a college football thing.
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