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Spartans outsource rights to Fox

Michigan State, one of the last power five schools to manage its multimedia rights in-house, has agreed to outsource those rights to Fox Sports, industry sources say.

The contract, nearly two years in the making, has not yet been signed. Michigan State and Fox officials declined to comment, but sources say both sides have agreed to the basics of a long-term deal that will be in excess of 10 years.

The arrangement is thought to be among the most lucrative multimedia rights deals in the country, meaning the Spartans could earn up to $15 million annually. That’s a steep increase over the $6 million to $7 million a year the Spartans had been making by managing and selling their own rights.

Michigan State could earn up to $15 million annually from its multimedia rights deal with Fox.
Photo by: GETTY IMAGES
The deal with Fox also represents a sharp about-face by Michigan State, whose athletic director, Mark Hollis, has staunchly advocated for the in-house model because of the flexibility and independence that comes with it. Hollis often told the story about giving General Motors a break on its annual sponsorship fees in 2009, when the company was mired in bankruptcy. It was the right thing to do, Hollis said, because GM had been a loyal sponsor through the years and it represented being a good neighbor to the Detroit automaker during tough financial times. A third party likely wouldn’t have been able to give GM such a break, the school reasoned.

On the flip side, Hollis has conceded that Michigan State was leaving guaranteed money on the table by not going with a third party. A big media company like Fox could put more resources into sales than the school.

Despite the Spartans’ past resistance to outsourcing their rights, they still managed to be included on many national sales deals, such as the Delta sponsorship deal last August. Michigan State did miss out on Nissan’s 100-school deal in part because of its relationship with GM.

Through the years, the Spartans have maintained contact with the major rights holders in the college space, such as IMG College, Learfield and, in more recent years, Fox. While Michigan State held fast to its in-house sales structure, Hollis and Paul Schager, the school’s executive associate athletic director and an 18-year veteran of the department, regularly met with rights holders as a way of monitoring the space.

That’s what eventually led to a series of conversations with Fox, a media giant but a relative newcomer to college multimedia rights. Fox’s portfolio includes the recently completed deal at Villanova, Georgetown, the Big East and Southern California. In fact, it was Fox in 2011 that convinced USC to outsource its rights after a long period of managing and selling its own rights.

The agreement represents a big win for Fox, which is believed to be a finalist for the rights at Auburn as well.

The deal with Michigan State is expected to include most of the traditional inventory, such as the Spartans’ radio network, corporate sponsorship, game-day hospitality, publishing and in-venue signage.

The deal is far enough along that Fox already has hired a general manager, Kris Kassel, who will oversee the Spartans’ property. Kassel, an associate AD at Gonzaga for the last four years, previously has sold for the properties at Alabama, Arizona and Memphis while also working in the athletic department at Evansville. He will work closely with MSU’s Schager, who has long overseen the Spartans’ multimedia rights. During that time, Schager was the school’s direct contact with its corporate sponsors, while also running events, ticketing, sales and marketing.

The only other power five school that manages its rights in-house now is Arizona State, which parted with IMG College more than a year ago.

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