Will Football Realignment Destroy ESPN's Sports Offerings Next?
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Is ESPN about to lose the Atlantic Coast Conference?
Not the entire ACC, mind you. I am not suggesting that.
ESPN has a binding contract with the conference, after all.
Just the best parts of the ACC.
In a juicy followup to ESPN (allegedly) directing the ACC to pull Pitt and Syracuse from the Big East, ESPN is now facing the possibility of seeing the ACC disassembled.
Consider the ESPN implications
The Pac-12 has the Pac-12 Network, as well as split-rights deals with Fox and ESPN.
The Big Ten is a partial owner of its network with Fox, and they have a separate deal with ABC/ESPN.
The SEC tier one rights are owned by CBS, with ESPN owning tier two rights. ESPN and The SEC are transitioning to a network plan.
The rights to the Big 12's content is split between ESPN/ABC (tier one) and FOX (tier two).
The Pac-12, Big Ten and SEC are the three conferences above the ACC in the conference pecking order (I have also thrown in the Big 12, which is not higher than the ACC but which appears to be looked on favorably by the Big Ten and SEC).
The ACC is all ESPN's. ESPN owns the ACC's first, second and (in some instances) third-tier media rights.
The ACC's content fills a ton of hours on ESPN. That deal provides ESPN with a ton of solid content at a below-market value.
The ACC is a conference with great markets and a similar worldview among their schools. In theory, the ACC has the attributes to be a very sound and stable conference, but that very TV deal threatens to rip the ACC apart.
How exactly is the ACC going to be ripped apart?
Obviously, no one knows for sure what will happen next in realignment, but there are always rumours. TheRealDudeofWV has developed quite a following for being a plugged-in realignment reporter. Here is his latest missive:
I'll maybe have a post next week with greater detail but for now this will have to do. Jim Delany has plans to expand and has been in talks with GT, UVA, BC and FSU. GT and BC would move as soon as an invitation has been received but UVA has been dragging its feet and FSU will not be the first to leave the ACC. According to multiple sources within the Big 10 Delany has yet to extend any formal invitation but if the Big 10 moves it will be in the mid-January to late January range. If they (the Big 10) do not raid the ACC by the first of Feb. we can expect a lull until next summer or fall. The Big 12 continues to talk to FSU, Clemson and Virginia Tech while the SEC has focused on UNC/Duke but would take FSU to keep the Big 10 out of Florida much like they took TAMU to keep the PAC-12 out of Texas. They have no concerns over the Big 12 taking FSU.
Why is UVA dragging its feet is the question of the day, but I'm told it looks like UVA is beginning to move again. As soon as UVA communicates to Delany their willingness to move the B1G pounces.
All the talks are done between the B1G and the four I mentioned. Everyone knows where they stand and UVA seems to be the key although if UVA hasn't decided to jump by mid-Jan. the B1G could take BC in their spot and force the issue.
All of this info comes from sources within the Big 10 and not WVU. WVU continues to say that FSU and the Big 12 have an agreement. That's not to say WVU is misleading anyone but that FSU is most likely protecting its interests and keeping the Big 12 on the hook just in case....
Now it sounds like the Big Ten is prepared to go not only to 16, as most thought could happen, but to 18. It seems likely that they see UVA and FSU as their preferred targets (probably due to TV realities and recruiting benefits).
For most conferences, 18 might seem unlikely, and even awkward. But this kind of plan isn't out of character to the Big Ten—they have previously expanded to equally awkward number combinations like 11 and 14.
This kind of addition works athletically and financially with their business model. All of the mentioned schools fit academically. It seems sensible for all parties.
Now, rumors are just rumors until they happen, but considering the source, it is not an expansion rumor that can be easily dismissed.
One can imagine each school struggling (or not) with the decision.
The University of Virginia is likely hemming and hawing because they like the ACC and the affiliation with Duke and North Carolina.
Florida State not wanting to field the criticism that comes with going first makes sense as well.
The Big 10 probably recognizes that while they could get Georgia Tech and Boston College at any time, they may not want to add that pair first—in case it creates a window of opportunity for ESPN recover. This would be in character for the Big Ten in realignment terms.
When they were trying to target UT in 2010, emails from Ohio State's President E. Gordon Gee to Big Ten commissioner Jim Delaney laid out their realignment philosophy pretty clearly. Gee wrote he was "of the mind that we control our destiny at the moment, but the window will soon close on us. Agility and swiftness of foot is our friend."
Certainly, the loss of UVA would probably have FSU walking out the door to the Big Ten with Georgia Tech.
It sounds like the Big Ten is willing to wait up to a year (if they have to) in order to get those four schools.
The most damning thing from TheDude is that the kings of the ACC—Duke and UNC—may be talking with the SEC about a package deal. That implies that they think Virginia will eventually jump to the Big Ten.
In broader terms, it would suggest that Duke and UNC believe the ESPN deal has killed the ACC as a top-level conference.
The Big 12 landing VT, NC State, Louisville, Miami and Clemson (and one) sounds ridiculous, but in this scenario, anything could be possible—including Notre Dame again flipping the Big Ten the bird and joining that Big 12 and VT somehow ending up in the SEC.
Could we be on the cusp of seeing the ACC devolve into a conference comprised of Syracuse, Pitt, Wake Forest, Temple, Villanova, UConn, Cincinnati, UCF and USF, along with Notre Dame on a scheduling agreement?
(I'm just thinking out loud here, but if they added some strong basketball schools as Olympic-only members, that could be the best basketball conference in America! Even if the football is not up to snuff, I am sure ESPN would offer something in the ballpark of $10-11 million per all-sports member!
I wonder if the Big East Catholic schools would want to join...? I kid...I kid.)
It is possible that the ACC's elite schools might vanish overnight, to be replaced in the ESPN broadcast offerings with effectively a rebuilt Big East—a much less popular and valuable asset.
What will ESPN do?
The presidents of the ACC membership all really like the ACC. On their own, they could probably save the conference today by signing a "Grant of Media Rights" deal that matches the Big 12's. There are even reports that the ACC presidents have discussed the idea.
The amusing question is, "Do they want to?"
The ACC has great markets, but the value of its football content has been hurt over the last decade by Bobby Bowden staying too long and Miami's NCAA troubles. The ACC clearly was forced to sell their content to ESPN at a discount.
If most of the ACC schools leave for other conferences, those schools would dramatically increase the TV payouts of the conferences they join.
Do Florida State, Georgia Tech, BC and Virginia want to commit their rights to the ACC (and ESPN) in order to make $19 million a year rather than $40-plus million a year in the Big Ten?
The Big Ten is arguably the most respected academic entity among the FBS conferences, due to the staggering amount of research dollars the Big Ten schools secure.
Do UNC and Duke want to make $19 million annually, or would they rather join the SEC as the acknowledged academic stars of that conference and make $30 million a year each, plus any network revenue?
If the ACC is melting down and facing a future of payments of less than $19 million a year, do Virginia Tech, NC State, Clemson, Miami and Louisville want to be bound to the ACC, or would they rather make $25 million or more annually for their first- and second-tier rights only in the Big 12?
Those conferences' payout numbers do not easily go up without ACC schools. If ESPN just works with the ACC schools, the difference between the ACC payouts and those of most other conferences may not be pronounced.
The ACC schools could be content. ESPN could make it very easy for ACC schools to stay home.
While all of these ACC school like (and maybe even love the ACC, with its history and rivalries), are they willing to turn their backs on huge raises to remain indentured servants to ESPN?
To any fan sick of ESPN's alleged conference meddling, this whole story is incredibly juicy.
So... Does ESPN deal with the ACC fairly?
Do they reach a concession on the ACC's third-tier rights that ESPN owns? Maybe ESPN can just give those rights back. Maybe ESPN could build a network around those rights with very favorable terms to the ACC. (Here is a crazy idea. Maybe ESPN could treat the ACC members like a valued asset—like ESPN does the University of Texas...)
In order to get the ACC schools to sign over their media rights to the conference for the length of the deal (à la the Big 12 Grant of Rights deal), is ESPN willing to give the ACC schools a sizable raise on their tier one and tier two rights (say, $5 to 8 million per school)?
Or does ESPN risk all of the best content in the ACC being pushed into conferences where other broadcasters have deals? (That just puts more and better football and basketball content on networks that are not ESPN, and remember, as part owner of the other conference deals, ESPN is still going to have to pay up.)
While one has to feel for the fans of ACC schools caught in the crossfire, would there not be poetic justice if the end result of all of ESPN's (alleged) manipulations over the last two years is ESPN suddenly and permanently losing the ACC, their deep source of cheap, quality content?
When the histories are written, will ESPN have nuked their own sports offerings by fanning the fires of realignment?
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