SBD/April 23, 2013/Colleges

ACC Gains Stability With Grant Of Media Rights; ACC Network The Next Step?

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ACC member schools who exit the conference will forfeit TV revenue until '27
The ACC’s 15 current and future member institutions yesterday announced that they had "agreed to a grant of media rights, which allows the conference to retain a school’s television rights if it leaves the league," according to Andrew Carter of the Raleigh NEWS & OBSERVER. The ACC’s 15-member Council of Presidents "unanimously approved the grant of rights." If a school were to leave the ACC, it would "forfeit its television revenue to the ACC through the 2026-27 academic year." The grant of rights, "effective immediately, all but eliminates the possibility that a school would leave the ACC, because ACC schools would bring no television revenue to another conference." Without a grant of rights, the ACC could have been "susceptible to being poached by other conferences." Carter cites sources as saying that under its deal with ESPN, each ACC member beginning in '13-14 will "receive an average of more than" $20M per year. Thus, a school that left the ACC in July "would forfeit" about $280M in TV revenue "over the next 14 years" (Raleigh NEWS & OBSERVER, 4/23). SI.com's Pete Thamel noted the deal represents a "similar model to the deals in play in the Pac-12, Big 12 and Big Ten." The agreement is "incredibly significant progress" for the ACC (SI.com, 4/22). Florida State Univ. President Eric Barron said that the agreement was "necessary to proceed with long-term re-negotiations with ESPN." He said network execs were growing “tired of conference realignment because they’re being asked to pay more for what they already own." Barron: "Every year, they’re being asked to renegotiate their contracts" (TALLAHASSEE.com, 4/22).

SO HAPPY TOGETHER: Virginia Tech AD Jim Weaver said, "It’s a very strong statement that everybody’s on the same page and the ACC’s moving forward.” Univ. of North Carolina AD Bubba Cunningham in an e-mail wrote, "These are strong and definitive moves by the ACC and its member schools to further announce our desire to stay together and position ourselves among the top conferences in the country" (RICHMOND TIMES-DISPATCH, 4/23). Pittsburgh AD Steve Pederson: "This not only legally binds everybody to it, but it also puts in place some teeth into what we've been saying that everybody believes, which is that we were going to be together, we were going to move forward together" (PITTSBURGH POST-GAZETTE, 4/23).

THE TIE THAT BINDS: SI.com's Stewart Mandel wrote, "It appears major conference realignment may be over for the foreseeable future." While there had been "little talk recently of any further realignment among the power conferences, both fans and industry insiders felt another move would come soon enough -- and nearly all speculation centered around ACC schools." While a school that "really wants to leave could theoretically test the contract in a court of law, the downside of losing with a Grant of Rights in place would be infinitely costlier than" a $50M exit fee. Meanwhile, the news of the ACC's grant of rights "reportedly coincides with planning for a possible ACC Network that could help push teams' annual revenue" to $20M "or beyond." That would put the ACC "on the same stable ground as its competitors" (SI.com, 4/22). ESPN.com's Brett McMurphy noted with the grant of rights "in place at three other power leagues, if the Big Ten wants to add more schools, it would have to target schools from leagues that don't have a grant of rights -- the SEC, the American Athletic Conference (formerly Big East), Mid-American, Conference USA, Mountain West, Sun Belt -- or BYU." A source said of the ACC, "People are always speculating about teams leaving the league, but no one has wavered. This (the grant of rights) is a good move. A proactive move" (ESPN.com, 4/22). ESPN.com's Andrea Adelson wrote every time the ACC "has been threatened," Commissioner John Swofford has "come up with an answer." Yesterday, however, "brought the greatest answer of all." Adelson: "Perhaps now, the ACC and its fans can rest easy. And Swofford can finally get the credit he deserves for batting away one threat after another, and keeping the ACC well positioned into the future" (ESPN.com, 4/22).

THE OUTSIDERS? In Hartford, Amore & Doyle write the deal would "appear to be bad news for UConn, which has made no secret of its interest in leaving its current conference, the American Athletic Conference, for the ACC if an opening existed." But the deal could "conceivably help UConn," because if the Big Ten is "unable to lure ACC schools now, it might look to UConn." Or, if the ACC "chooses to expand from 14 to 16 schools, UConn and/or Cincinnati could be invited." NYU sports business professor Robert Boland said, "I don't think it changes much for UConn, other than it narrows the field of available options" (HARTFORD COURANT, 4/23). ESPN.com's Adelson wrote UConn and Cincinnati "bring no real monetary value from a television rights perspective." The Big Ten "already has Ohio State and Rutgers, so adding two schools in similar regions is not going to bring in more money to the league." Without the ACC as a "viable option, it appears both Cincinnati and UConn may be in the AAC for quite a bit longer" (ESPN.com, 4/22).
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