Conference Realignment: It Is Time For The Pac-10 To Sweeten The Offer

Tobi WritesAnalyst IJune 12, 2010

STILLWATER, OK - OCTOBER 31:  Cody Johnson #31 of the Texas Longhorns carries the ball against the Oklahoma State Cowboys in the fourth quarter of the game at Boone Pickens Stadium on October 31, 2009 in Stillwater, Oklahoma.  (Photo by Ronald Martinez/Getty Images)
Ronald Martinez/Getty Images

Yesterday, a realignment story broke out of Kansas City that rang mostly true to me.  It stated that the University of Texas and Texas A&M had reached a consensus to go to the Big Ten.  That left behind Oklahoma, which was petitioning the SEC to be considered for membership.

All of this makes a ton of sense to anyone following all of the fine details of the UT and A&M realignment stories specifically.

Afterall UT has been in discussion with big players in the Big Ten for quite a while.  The recent release of emails between Ohio State's and UT's presidents suggest that UT wants into the Big Ten and that they consider Texas Tech a potential problem in reaching that goal.

That doesn't suggest a school that is chomping at the bit to carry Texas Tech to the Pac-10.

The emails also suggest that the Big Ten knows they will have to act very quickly to get the teams they want before pushback blocks their efforts.

A&M seems to want to move to the SEC, but UT doesn't.   Although it is not a given, A&M may very well be tolerant of a move north for a really big annual TV payout.  

I had thought you might see A&M push their way to the SEC with UT letting them go at the price of A&M letting UT go to the Big Ten.  There seems to be an understanding that either UT and A&M will stay together or they will end up in conference situations that they consider of equal value.

The Big Ten may be closing in on their grand slam scenario - Nebraska, UT, A&M, Notre Dame, and Rutgers (for a NYC platform to sell their name brands in America's #1 market).

The TV money in this kind of conference could literally be double what everyone else is making. (I think UT might find their gains are a fraction of what everyone else in the conference gains based on a loss of local relevance.  UT made $138 million in sports revenue last year, only $10 Million or so was TV revenue.  That suggests that UT may be much more reliant on local rivalries and consistent national contention to spur merchandise sales.  How much of a value add is it for UT if a loss of competitiveness - fueled by recruiting losses - and conference important rivalry games costs them say $20 Million in merchandise sales and contributions?  Fan ennui could set in. )

(In order to preserve competitiveness between the elite BCS conferences, I personally hope the Big Ten doesn't land UT and A&M.) 

I also think UT and A&M would find recruiting hard in the Big Ten.  Players from Texas simply are not generally enamoured by the Big Ten.  You could see the SEC pick off more Texas blue chippers that UT targets.

If UT and A&M are looking at the Big Ten, it makes a world of sense for OU to be petitioning the SEC.  OU is the odd man out if UT and A&M go to the Big Ten.  If OU can secure SEC access then go to A&M and say, "let's both go to the SEC." 

That can put UT in a tough spot.   In that scenario UT might have little choice in terms of recruiting than to go with them lest the two end their series with UT and collapse UT's main revenue streams.

A&M gets what they want and OU isn't left behind.

The Pac-10 needs to redouble their efforts to prevent this kind of possible progression from occurring.

I have fleshed out what I believe is needed to close the deal.

7 possible steps by the Pac-10 to close the deal

There is a lot of carrot and a bit of stick to my suggestions.

1) Allow university sports networks

Allow any school (or combination of schools) in the conference to start such a network (including UT) but any athletic competition that the conference's own shared network deems worthy of broadcast is broadcast live on the conference's network and delayed 30 minutes on the school's network.

If UT wants to show their victory over OU over and over all week long, let them as long as the league's network gets the priority option on the initial broadcast of all games.

Then there is the revenue question.

Simply require all profits from a university's (or universities') network to go towards academic scholarships at said school(s).

UT gets to earn and keep their money, which is their point.  The financial balance of power in athletics in conference would be maintained at today's status quo, which is the point of their conference mates.

That gives UT everything they liked about the Big 12 except absolute control, with the chance to retain their revenue streams, start their own network, and add a doubled TV payout.

2) Assure UT that even if A&M doesn't come the Pac-10 will look out for UT's recruiting and local revenue generation by assure quality rivalry games.

It would be a very good counter to the SEC's actions for the Pac-10 to offer A&M's slot to Arkansas.

"What?  Arkansas would never leave the SEC!!!"  Don't be so sure. Arkansas generated a little under $64 Million in athletic revenue last year.  If $17 Million was their TV payout from the SEC, that means Arkansas's local contributions were only slightly more than TCU's.

Six big 12 members drew more total athletic revenue than Arkansas, and one of them was Oklahoma State.

Arkansas may be in line to make as much as $5M more in TV revenue in the SEC, but being in a division with OU, OSU, Tech, and UT would activate their fan base, much like being in the Big 12 has activated the UT and Oklahoma school's fan bases.  It is entirely likely that Arkansas would more than make up the TV revenue difference being back in the fold with their #1 rival.

Potentially the combination of A&M and Arkansas would open the state to SEC recruiting.  Removing Arkansas strongly limits what the SEC could do and further isolates the damage an A&M defection to the SEC would do to Texas collegiate football.

3) Bribe A&M.

When Texas needed A&M to come with us to the Big 12, the Lt. Governor got the votes for A&M to get their new basketball arena.

A&M's athletic department is something like $16M in debt due to what some might call gross mismanagement.  It is an embarrassing situation. As they are the leaders of the biggest source of contention, lets pay that debt off in return for their vote.

Every other team in the conference could give A&M their first $1.07M of the new TV contract. With that A&M's athletic department would be done with their embarrassing debt.

4) Get Aggie Texas Governor Rick Perry to buy in to the Pac-10 vision.

Perry is one of the proponents of the three publics to the Pac-10, or at least is credited with pursuing that view.  He is from West Texas, so there is an assumption he might look out for Tech.  He is reportedly friends with Kent Hance, Chancellor of the Texas Tech system.

If the Pac-10 could meet with Perry and really underscore the fact that aggie degrees would be devalued by moving to a conference situated over one of the poorest regions in the US --- the deep south --- while they would be enhanced being a part of the Pac/SW 16, the Pac-10 would give Perry ammunition to argue with the pro-SEC faction lead by former Aggie coach Gene Stallings.

Perry might not realize it, but if the Aggies and Longhorns abandon Tech, West Texas and DFW could vote him out of office for standing by while it happened.  He has a vested interest to get the three major Texas schools into one of the elite BCS Conferences together. 

The separate scenarios are all glass half empty scenarios for some of the fans of those schools.  He could take voter anger from all camps if they go to three different conferences.

5) Stress that OU is a key to the deal, not a sidekick.

The Pac-10 needs to treat OU like they treat UT.  OU can deliver North Texas including the DFW market.  That means really the Pac-10 can put together an SEC revenue caliber conference without UT or A&M, but only if the Sooners come.  They are the hub to build around.

Right now the Sooners are probably on the fence about the Pac-10 because they might see a scenario where they are a conference outlier and the money isn't there.

The Pac-10 need to sell them on the research dollars, increased degree value, title chances, and local revenue. 

With a little effort from the big research schools in the Pac-10, OU could easily add far, far more to their research budget than any conference TV share for sports.

Currently OU does about $100 Million in research annually.   If the Pac-10 powers put a little effort into doing co-operative research with OU they could quickly bring that up to $150 million a year.  That is a lot more money in the university's pocket than the SEC could ever provide.

Additionally, The Pac-10 could steer OU to doing what is needed to earn AAU status.
The benefits of a move to the SEC are athletic only.   The moves to the PAc-10 are far greater financially and much more rounded.

Just like with the Texas schools, a degree from a Pac-10 school is worth far more due to the richer Pac-10 footprint.

OU would either be one of the powers of the southwest division if UT and A&M are in, or the power in the division if they are not.   Run the schedule of top 25ish teams, beat USC, and title game here they come.

Finally The Pac-10 should commit to OU that one way or another the Pac-10 will take steps to protect the local part of OU's revenue generation.  OU generated $81 million in athletic revenue last year.  Only about $9 Million of it was TV revenue.  That means OU still generated about $72 Million from ticket sales, merchandise sales, and whatnot driven by rivalries and local support.

6) Get Texas Tech and Oklahoma State to bring out their guns.
Kent Hance needs to be putting the pressure on UT and A&M.  In a similar manner, T. Boone Pickens needs to be putting pressure on OU.  Both Tech and OSU have the most to gain and the most to lose if this deal doesn't go through.

Cowboys and Red Raiders fans need to be calling their local papers and media outlets and demanding they talk about how the "big powers" could sell out the people of the states by stopping the further academic growth of these two publics.

The Pac-10 is a free pass of Oklahoma State and Texas Tech to dramatically speed up their evolution into very high level academic schools.  For Tech, which is only $49 Million in annual research spending from becoming the state of Texas's third public school and 4th university overall to earn the designation of "Research University", admission to the Pac-10 is absolutely vital.

There is a lot of pressure among Texas legislators to add more research universities to stop the brain drain of top students leaving the state and to bring in the high paying jobs and new industries research creates.  Tech fans should be using this leverage to ensure the Texas trio goes west.

7) The League needs to get approval for an 18 team conference and go talk to Missou and Kansas.

It is counter to conventional wisdom, but an 18 team conference is actually a much better scenario for the Pac-10 than a 16 team conference.

16 team conferences tend to mess around with pod systems for scheduling and the like.  As the membership of the MWC can attest, that only ends up upsetting the teams in the conference.

An 18 team conference would allow the conference to be run as two separate nine team conferences.  Nine teams are a preferred number for football based conferences as it leads to easy scheduling.

Additionally as the Pac-10 has three teams that would want the last slot with the Pac-8, having nine teams in a division would be a gold mine, allowing the Pac-10 to pump up a perceived weakness of the Pac-10.

Colorado could be in the Pac-9 for football, allowing the Buffaloes to have a resurgence based off recruiting gains.  (Colorado struggles in football in the Big 12 because they can't recruit Texas.  Colorado has an enormous California alumni base and appeals to California recruits.  Currently 23 of Colorado's players are from California and only 3 are from Texas. With Pac-9 divisional membership they would have quality from California to go with their numbers allowing Colorado to re-emerge as a football power.)

ASU and Arizona have not shown any ability to consistently win with California recruits, so they go with the southwest nine.  It is entirely likely they can pull better from Texas than Colorado could as the cultures are more similar.

Arizona could be in the Pac-9 for basketball, protecting the dynamics that have made Wildcats basketball a national power over the years.

Arizona State could have the berth for baseball for the same reasons.

It would allow the Pac-10 to protect conference sport powers from unintended realignment fueled meltdowns.

It would be smart to tell Missou and Kansas to rest easily - regardless of what happens with UT and A&M, the Tigers and Jayhawks will be offered slots in the Pac-10...It just won't happen until the UT/A&M issue is resolved so as not to complicate the matter.

Those two schools are pretty solid academic schools, they are state flagships with statewide followings, they both draw BCS level attendance figures.  Both are playoff level teams in both revenue sports.  They combine to add about 9 Million residents to the footprint and two big central timezone media markets and are old Big 8 rivals to OU.

If UT and A&M join, it's an 18 team conference.  If they don't, the Pac-10 would still have 16 teams. 

They would still have added about 23 Million residents to their 54 for a total of 77 Million residents. 

They still would have added key markets in Dallas, Denver, Kansas City, and St. Louis and would still have football and basketball brands to sell.  They would still have solved their time zone problem.

They would still be looking at at least 17M or so in TV payouts from a TV network.

Today it looks like the gold ring may be tumbling out of the Pac-10's grasp...

...But it doesn't have to happen that way.  There are still a number of cards to be played.


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