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As the dust settles from the recent shockwaves of conference realignment, we are left to learn who is in what league and take a moment and realize how many schools, conferences and media deals were impacted when Oklahoma and Texas stunned all with their move to the SEC.
Heck, the Sooners and Longhorns bolting to a new home is the reason one conference now has three schools who go by Owls (AAC- Temple, Rice, FAU). It's also the reason why Conference USA is trying to decide what FCS schools to add and sell that idea as a viable reason to keep its doors open.
But these moves have always been, and will always be, about money and that's why we should now all be ready for another big move in the not too distant future.
There is one Power 5 conference that is clearly on the clock and it's not who you think it is(I think). More on that in a moment.
There is much going on off the field, that presidents, athletic directors and commissioners are dizzy trying to keep up. Will Congress get involved with a national move on Name, Image and Likeness? Will the NCAA be stripped of all power and become nothing more than a marketing and events division that puts on tournaments? Will the ongoing lawsuits lead to full blown labor battles where players get to collectively bargain and if that's the case, with who? Conferences? Schools? Will Disney spin off ESPN as the Mouse continues to focus on its streaming game plan and if that happens what happens to ESPN's money model and how does that impact the billions in rights fees they currently pay conferences?
Yes, do not sit down and relax thinking we are done because Oklahoma and Texas made a move east and UCF and BYU are about to become conference rivals.
If some of the above issues continue to fester, what will new media deals look like for conferences? Could the media rights bubble be popping as many wrongly predicted years ago? Will any streaming service step forward and throw money or crypto(sort of joking here) at P5 leagues for their live rights? And do not underestimate the unlimited cash(for now) of sports gambling companies who are already showing an interest in the NBA and other sports to offer live coverage.
But back to the present and future of Power 5 leagues and who might be on the clock. First, it's not the SEC or the Big Ten. Both are launching into an orbit no one can keep up with. They currently make the most money in comparison to the other three leagues and the gap is only going to get bigger.
Here's the average payouts per P5 in recent years(taking into account a challenging 2020 with Covid but also using strong 2018 and 2019 figures):
Big Ten $54M
SEC $45M
Big XII $38M
Pac 12 $34M
ACC $33M
(these are not exact figures but a rough estimate but the breakdown of top to bottom is widely viewed as the order by industry experts and include media/CFB Playoff/bowl payouts and additional monies earned)
Obviously, the Big XII deal is about to change with the exit of its two biggest brands. The SEC's new media deal, by taking the CBS package, is going to rise with that game and adding Texas and Oklahoma. It's the reason the two schools made the move. But the SEC is not alone in a new media deal.
Current media deals will expire:
SEC - ESPN had a deal that runs through 2034 but also added the CBS package that starts in 2024 and that deal alone is worth $300M per year
Big Ten - current deal ends in 2023
Big XII - current deal ends in 2025 but that likely shifts with the expected move of Oklahoma and Texas and the arrival of UCF, Cincinnati, Houston and BYU
Pac 12 - current deal ends in 2024
ACC - current deal ends in 2036
You figured it out yet? Which conference may find itself in a similar spot that the Big XII found itself in? Which league may wonder what their biggest brand or brands thinks about an expected revenue gap that will grow significantly in the coming years?
Here is what Navigate(sports marketing research company) projected payouts per school to be by 2029 BEFORE Oklahoma and Texas made their move-taking into account projected new media deals:
Big Ten $90M
SEC $82M
Pac 12 $60M
ACC $51M
Note: Those figures were projected in the summer of 2020 and much has and will change in the coming years with expanded playoff. I left out the Big XII projection($67M) because it included Oklahoma and Texas as members.
Ok, so let's go on a Big XII journey for a moment. Commissioner Bob Bowlsby met with Pac 12 leader George Kliavkoff shortly after the Sooners and Longhorns made their move. Many viewed it as a desperate move with hopes of a merger of his remaining eight schools and to form a new super league of 20 schools. Maybe. But Kliavkoff , new on the job for a short time, listened and nothing really materialized- for now. It's in Kliavkoff's best interest to keep all his options open. He has a new media deal on the horizon and is trying to get the maximum money and get more exposure for his league that can't change the fact we have time zones that mean a 7:30p local start ends long after midnight in Orlando.
After not finding a partner in the Pac-12, Bowlsby and the Big XII did what they knew they always could do. They added four schools they knew would accept an invitation and moved on UCF, Cincinnati, Houston and BYU and the league survived. The league still stands to get a decent media deal without the Sooners and Longhorns, although it will be less than what it could have been if no one left.
There was that odd partnership with no written agreement to form an "alliance" with the Big Ten, ACC and Pac 12. My expectation is that nothing more than a few games scheduled between these leagues comes from this. They were angry the SEC made their move despite all three commissioners knowing they would have done the same thing if they could.
That brings us back to the league who might be the tilting and wobbling domino. If we are to assume this season is a one-off for Clemson and that the Tigers will return to being the dominant program they have been the last decade and if Florida State can figure things out and get back to being who they once were, what happens? Can Clemson sit and watch their national rivals(Alabama, Ohio State, Oklahoma, Georgia) make $30-40M more every year? What if that money gap is bigger?
The ACC cut a bad deal with ESPN. Yes, ESPN gave them the ACC Network, which still struggles with clearance(ask UM fans how it's going in south Florida) and channel placement(not near the other popular sports channels and likely behind those pay sports channels you don't watch). The current deal runs through 2036 and while stability can be a good thing this may not be a good thing. Everyone else is getting a new deal and there is no reason for ESPN to go back in just to give the ACC more money, especially when Disney is deciding what to do with ESPN and its current financial model that relies on cable homes and you paying around $10 a month for ESPN's channels.
So what would happen if Clemson caught Greg Sankey on a good day and he listened to a pitch? Maybe Sankey says he already has South Carolina and doesn't need another team from that state. They don't bring in more money for the SEC network in the state because the Gamecocks already force all cable operators to carry the SEC Network. Maybe Florida would strongly oppose any idea of a resurgent FSU thinking of a move to the SEC. But everyone, for a second, thought there was no way Texas A&M would allow Texas into the SEC. Heck, their AD publicly opposed it. Because he had to. But by the time he opposed it publicly the deal was done.
What if whispers of Clemson smelling more money elsewhere made, not just FSU, but North Carolina and others in the ACC think about a move and not be left behind. A 20-team SEC?
If Clemson, Florida State and others would make the SEC a lot of money, which means more money for all members, would they oppose another expansion? Do they make a lot of money for the SEC? I think a pool of the best ACC teams adds value but they don't add the money like Oklahoma and Texas will. But what if the SEC truly has an idea of becoming the biggest and richest league that doesn't care about P5 things or what a weakened NCAA thinks of how they run their league? What if, in the new NIL world and the possible path to pay players makes the SEC become its own professional place andits own expanded playoff, like a four team SEC postseason? Crazy ideas of today may be the norm of tomorrow. Everything is on the table.
If Clemson, FSU, North Carolina and another pull an Oklahoma and Texas, could the ACC survive? Sure, but it would be a devastating blow financially. But what about the ACC's Grant of Rights which all members agreed to when the new deal kicked in? Great question. Any move to leave the league means a school would have to pay an exit fee and leave behind all of your media money for the remainder of the deal. That could be north of $250M if you tried to move in the coming years. No one is paying that. But let's get back to Oklahoma and Texas for a second.
All eyes will be on how both leave the Big XII. They publicly are saying they will stay in the league until 2025 but no one believes that. Most expect everyone leaving and coming into the Big XII to be in their new league by the start of the 2023 season. How Oklahoma and Texas negotiate their exit will be something to watch and may give anyone wanting to leave the ACC a plan. It will cost the Sooners and Longhorns a lot to leave because the exit fee alone is two years of revenue distribution which is about $35-40M a year so the exit fee is about $70-80M.
If a domino fell in the ACC with Clemson, FSU and others eyeing SEC dollars, would the Big Ten look at Georgia Tech, Virginia, Duke? All would fit the academic profile the Big Ten likes. Would Notre Dame be forced to look at making a move? Would the Big Ten go into the Big XII and listen to the calls of Kansas and anyone else? Would the Pac-12 feel like they needed to make a move and revisit Big XII members to get to 16 or more? Would the Big XII and Pac 12 think about a partnership to create more games outside of the west coast time slots? What would a true break away look like from the P5 leagues or does the SEC not wait and just play their own league and their own championship.
A mess? Of course. Chance of happening? Not great. But one year ago no one thought we'd be where we are today.
I don't see a conference game with UCF and Washington State any time soon. But if I can see a potential Big XII game between Boise St and UCF then the first idea can't be that odd. Remember this about the Big XII- Bowlsby said the day the conference added its newest four schools they may be done. The Big XII knew in 2016 it could always grab UCF, Cincinnati and Houston. Maybe they felt good about BYU five years ago as well. Now, Bowlsby knows Memphis, South Florida, Boise State and another school are always available if you need to grow. You don't need them now until you know all your options moving forward. If you have to get bigger you can look at the Pac-12 for teams or to partner with. If that doesn't work, the Tigers, Bulls, Broncos and someone else will accept an invite at any time.
The point is the waters are not calming. The courts will determine what kind of playing field we have for athletes and what schools can and can't do. The NCAA appears to be becoming a thing of the past, at least in ruling collegiate sports. Media money is there but from who and where will games be seen? Several conferences have their media packages coming up and nothing is traditional anymore. There will be the normal bidders and there will be creative companies offering a new method of content distribution.
By the time the Big Ten, Pac-12 and Big XII get their new deals in place- and if they are smart they will be short term deals, not a 12-15 year agreement- the ACC will be sitting with a bad deal that will lag and not just way behind the SEC and Big Ten but likely well behind the Pac-12 and a new Big XII deal may be as good as the current ACC agreement. Does anyone really believe the biggest brands in that league just sit back and watch others make $40-50M per year? No way.
So take a deep breath. Things may be quiet for a few years but there's turbulence on the horizon and when the next big domino falls, it will be the biggest because of all the changes mentioned above. And never forget, it's alway about the money. Always.
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