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ACC faced with tepid TV response
Published March 8, 2010
The Atlantic Coast Conference and ESPN entered into a 60-day exclusive window March 1 to negotiate the conference’s next media deal.
However, the two sides are not expected to reach a deal by the time the window closes at the end of April, leading the conference to reach out to other networks — including NFL Network — about picking up a package, according to several sources. In fact, negotiations for the ACC’s media package aren’t expected to heat up until May, at the earliest.
ESPN has made it clear in private discussions with the ACC that it does not plan to approach the ACC’s lofty target rights fee of around $120 million per year, an aggressive 60 to 70 percent increase over its current deal. Media executives say the weakness of the ACC’s football teams puts the conference at a level below the Big Ten and SEC, putting it more on a par with the Pac-10 and Big 12.
ESPN’s position has caused IMG’s Barry Frank, representing the ACC in talks, to reach out to several networks to gauge interest in various media packages.
The most intriguing possibility has been discussions the ACC has had with NFL Network, which has expressed some interest on a potential package of football — not basketball — games, according to a source with direct knowledge of the conversation. Such a deal would help NFL Network pressure Time Warner Cable and Bright House Communications to begin carrying the channel, since the cable operators own systems through North and South Carolina and Florida.
The ACC also has reached out to Fox and Versus. Versus has established a college football programming lineup by sublicensing college games from Fox Sports Net. A move by Versus to pick up ACC rights would be, perhaps, the network’s most significant rights purchase to date and create sorely needed competition against ESPN in the college marketplace.
In the past two years, ESPN has signed deals worth a total of more than $2.5 billion in rights fees with the SEC and BCS. The ACC is the first college conference rights deal to hit the market in two years.
Fox already has a relationship with the ACC through FSN, which carries weekly Sunday night basketball games purchased from Raycom.
Fox lost the BCS rights to ESPN in 2008, but Fox has started receiving retransmission consent cash from cable operators and is believed to be looking to use that money to purchase sports rights.
The ACC also has not ruled out the idea of starting its own channel, though few people believe that’s likely.
Rival conference SEC negotiated a rights fee for football and basketball with ESPN and CBS of more than $200 million a year, but the ACC is not expected to reach that neighborhood. Industry insiders say the ACC would like to see a 60 to 70 percent increase over its current deal, which would put its target at $120 million a year for both of the major sports. The ACC’s media rights expire after the 2010-11 season. The Pac-10’s media rights and the Big 12’s cable football rights are up the following year.
The ACC’s deals with ESPN and Raycom Sports pay a little over $70 million a year combined. The agreement with ESPN for football rights pays $35 million, while Raycom’s basketball rights and the syndicated package pays another $35 million and change.
For the record, ESPN has said that it wants to keep the ACC’s rights. “We have every intention to be in the ACC business going forward,” said Burke Magnus, ESPN’s senior vice president of college sports programming.
Raycom has said it will seek a cable partner to increase its bidding power. Raycom Media, parent company of Raycom Sports, owns more than 40 over-the-air stations, many in the Southeast, which has made it an effective distributor of the syndicated games. But its ad-supported business model has been hurt by the recession and it failed to retain the SEC’s syndicated package, which went to ESPN.