Sidearm Sports adding Learfield schools Forty Under 40: Meredith Starkey Cartoon: Law and order league NFL licenses firm to market experiences Forty Under 40: Masters Champions Dinner D-League returns to ESPN Forty Under 40: Sashi Brown Forty Under 40: Chris Klein Richardson writes to fellow owners Arris connects with NASCAR
Upcoming Conferences and Events
Bidding war over the Pac-10’s TV rights is already developing
Published June 28, 2010
It got Utah instead of Texas. It tried to expand to 16 schools but wound up with 12. Its planned network will now reach just 18 million homes in the conference’s footprint rather than the 26 million it had planned.
Oh, and there’s the fact that its most marketable football team, the University of Southern California, has to deal with significant penalties because of a spate of NCAA violations.
By just about any measure, the last two months have been tough on the Pac-10 Conference. But if the conference were a stock, I’d be buying.
Despite its recent setbacks, I’m convinced the Pac-10’s future is bright based solely on a media landscape that should more than double its current take of around $53 million per year and see the launch of a full-fledged channel in the next couple of years.
In fact, the bidding war over the Pac-10’s TV rights already is developing, leading some industry executives to predict that the conference’s windfall could hit ACC-type numbers. In May, ESPN agreed to pay $1.86 billion over 12 years for the ACC’s rights. That deal hasn’t been finalized.
The Pac-10’s current deals with ESPN and Fox Sports Net end in 2012, and sources say that the two networks already are informally making their interest known via several events that have been set up with Pac-10 coaches in New York, Los Angeles and Bristol, Conn.
“They won’t be negotiating,” said one media executive who plans to attend one of the events. “But it’s definitely part of the courtship process.”
I’d be shocked if ESPN didn’t make a strong bid. ESPN loves college sports. It has extensive deals with the Big Ten, SEC, ACC and Big 12 and could use the Pac-10’s later windows to round out its schedule.
ESPN recently sent word to the conference that it is interested in discussing a possible channel partnership, sources say. The move is a significant one for ESPN, which in the past has tried to keep conferences like the SEC from launching such a channel, and it shows that ESPN will be a serious bidder.
But ESPN isn’t alone. I expect Fox will also make a significant bid for the broadcast and cable rights. Since Chase Carey returned to Fox last summer, the broadcaster has become more aggressive about adding sports to its programming lineup. Just last month, for example, Fox nearly stole the ACC’s rights from ESPN. I can’t see the broadcaster passing on a conference that’s in its own backyard.
Fox has had preliminary conversations with the conference about a partnership on a channel that would be similar to the Big Ten Network, which, in the college world, is considered a runaway success. Fox owns slightly less than half of the channel.
The wild card is Comcast. By the time the Pac-10 begins to accept bids, regulators will have approved of Comcast’s NBC acquisition, which should put Comcast at the table for any future rights negotiation. Having been out of the public eye for the year since the acquisition has been under regulatory review, Comcast almost certainly will covet the conference’s media rights, both for Versus and its family of regional sports networks.
While most industry observers view the Pac-10’s additions of Colorado and Utah as poor substitutes for Texas and Oklahoma, Comcast executives see the Pac-10 as a perfect fit. It operates cable systems throughout Colorado and Utah; it’s not the dominant cable operator in either Texas or Oklahoma. As it currently stands, Comcast is the dominant cable operator in markets covering eight of the Pac-10’s 12 schools.
Comcast likes to own programming in areas where it operates cable systems. I’d look for Comcast not only to bid on the media rights, but also to look into partnering on a channel.
That’s the conundrum the Pac-10 faces.
Earlier this month, we had several editorial meetings that tried to come up with a list of winners and losers from the conference realignment. We could not agree on the Pac-10 and its commissioner, Larry Scott.
Some felt that the conference could not be considered a winner. It badly overplayed its hand in its rush to become a 16-team super conference. Its pursuit of Texas and Oklahoma, in particular, felt clumsy: You don’t extend invitations unless you’re certain they will be accepted. After publicly trying to shoot the moon, the conference settled for Plan B. That’s an easy one for the loss column, right?
I argued differently. It’s true that Scott fell short of his ultimate goal, but he breathed life into the Pac-10, and that shouldn’t be underestimated.
I see the Pac-10 as a sleeping giant. Over the past decade, it has been one of the most underutilized brands in the sports industry. It has the worst TV deals of any major college conference.
Scott is in a no-lose situation; he has nowhere to go but up. Thanks to some of his bold moves, the conference stands on the cusp of bringing in more media dollars than the Pac-10 has ever seen.
John Ourand can be reached at email@example.com. Follow him on Twitter @Ourand_SBJ.