SBJ/March 21-27, 2016/Media

Big Ten tests market for new rights deal

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The bidding for the Big Ten’s television rights, which run through 2016-17 in its current contract, has begun in earnest.

The Chicago-based conference had one formal meeting with its primary rights holder, ESPN, earlier this month when Big Ten officials told ESPN that the league will open up the bidding process to other networks.

As part of its contract that ends next year, ESPN had first negotiation rights to renew, which essentially means that it was guaranteed the first meeting. That led to this relatively brief meeting, where conference officials made it clear that it wanted to gauge market interest in its television rights. ESPN sensed the conference wanted to explore the open market and did not discuss concrete deal terms either, industry sources said.

ESPN had first negotiation rights, but the conference has decided to engage other networks, figuring to land a higher rights fee.
Photo by: AP IMAGES
It’s no surprise that the Big Ten opted to engage other networks. Conference officials clearly hope to spark a bidding war among TV networks that would result in a higher rights fee.

Big Ten Commissioner Jim Delany is handling negotiations for the Big Ten — a move that differs from other major college conferences that have hired media consultants to negotiate on their behalf. The SEC, for example, used the late Chuck Gerber; the Pac-12 used Chris Bevilacqua; and the ACC works with Wasserman’s Dean Jordan.

In the weeks since the initial meeting, the conference already has reached out to CBS, Fox, NBC and Turner.

ESPN and Fox Sports, the two dominant media rights holders in the college space, remain the front-runners to cut a deal, sources indicated. Both have long-standing relationships and deep ties with the conference — Fox owns 51 percent of Big Ten Network, while ESPN is the incumbent on the Big Ten’s expiring 10-year, $1 billion deal. CBS has the rights to a smaller package of basketball games.

ESPN executives have said that they want to renew their Big Ten rights, though they also have run numbers on smaller packages, sources said.

ESPN holds the rights to most other college sports conferences and would hate to lose the conference that covers the Midwest and big markets like Chicago, New York and Washington, D.C. That’s especially true now that the Big Ten is home to two of the biggest coaching personalities in college football: Michigan’s Jim Harbaugh and Ohio State’s Urban Meyer.



The problem is that both media giants, ESPN and Fox, have been cutting costs recently, leading to questions about whether they are willing or able to pay the type of increase that the Big Ten seeks.

Last month, Fox offered buyout packages to longtime and older employees. Last year, ESPN laid off more than 300 staffers, many of whom were longtime employees.

CBS and Turner are said to be interested in picking up Big Ten rights, but sources said they are looking for smaller packages rather than one all-encompassing deal. For CBS, that includes a desire to renew its package of basketball games, a deal in which it currently is paying about $12 million a year. Turner would like some college basketball inventory as a programming lead-in for the NCAA tournament.

NBC is a wild card. Its executives plan to kick the tires on the Big Ten rights. Other than a package of Notre Dame football games, it does not hold rights to other major college sports programming.

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