Pac-10 Expansion: Inside the Board Room

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Pac-10 Expansion: Inside the Board Room
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The Pac-10 is now 11. The Big Ten (11) is now 12. The Big 12 is reduced to 10.  The Mountain West went from nine to 10.

Will the Pac-11 conference expand to 16 members, or 12?

The numbers game is a complicated and ever-changing one and with more seismic changes looming the numbers will only get more chaotic.

So let's focus on the numbers and issues that really do matter in an expanded Pacific Conference.

 

Constitutional Voting

Currently, the 10-member Pacific Ten Conference uses a voting system that varies depending upon the importance of the issue:

10 member unanimous vote required to approve any expansion member.

Eight votes required to make any constitutional changes.

Six votes required for any procedural issues.

In an expanded conference will the ratios be the same? 100 percent, 80 percent, and 60 percent?  This is extremely important for the approval of upcoming television contracts, bowl game decisions, championship game sites, and the formation of a conference owned network.  This decision is what can make or break the conference.

If a Pac-16 requires an 80 percent vote to approve the television contract that would mean 13 votes in favor, or the "veto" power of four schools.  With four or five schools possible from the Texas-Oklahoma region (depending upon which scenario plays out) that is an awful lot of power given to the "newbies."

A 12-member conference would need 10 votes, leaving three votes as a veto power.

Will there be a moratorium on what the new members can vote for, having to wait two years before they gain full voting rights?  This would allow the existing Pac-10 members to implement their vision without compromise, but might be a sticking point in getting UT and OU to sign up in the first place.

 

Revenue Sharing

This is a topic that has many facets in a conference discussion.  The Pac-10 currently has several ways that revenues are shared:

Football and Basketball Television Revenues

A hybrid formula is used that pays 59.5 percent of the proceeds to the conference teams making the appearance.  The rest is shared among the other conference members equally.

NCAA Basketball Tournament Television "Unit" Revenues

Split equally among the membership.

Post-Season College Football Bowl Revenues (after travel expenses)

Split equally among the membership.

Conference Championship Game Revenues

Split equally among the membership.

Football game net gate receipts (non-Rivalry game)

visiting teams are guaranteed a minimum of $125,000 and a maximum of $200,000 from the ticket receipts for conference games. (nearly all schools earn the $200,000 which is a wash if there are an even number of home/away games each year).

Football Rivalry game net gate receipts

Split equally among the home and away team each year.

Applies only to one designated "rival." (Washington-Washington State, Oregon-Oregon State, Stanford-California, USC-UCLA, and Arizona-Arizona State.)

With expansion, all of these issues will need to be determined due to new memberships.  Adding Colorado to the fold without a "rival" as of yet, means they will benefit by not having to share revenues with any other conference team.  This issue will most likely get addressed, whether the 12th (or 16th) team is Utah, Kansas, or Texas Tech.

Will the "rivalry" game sharing continue, or will that be a sacrificial lamb to get television sharing on an equal platform?

The issue of equal distribution of the football and basketball television package is the biggest stumbling block. The Big 12 imploded because the membership could not gain consensus on this issue.  There are many proponents of equal revenue sharing in the Pac-10 already, and I fail to see how Colorado would have been so eager to join the conference if this was not a top priority.

The most important factor that this issue leads to is also the next major decision the conference needs to address:

 

A Conference Owned Network

Larry Scott, Kevin Weiberg, and CAA Media Ventures (led by Chris Bevilacqua) seem 100 percent committed to the formation of a conference owned TV network, perhaps in partnership with Fox as the Big Ten has done.  Weiberg was a key player in the Big Ten Network's meteoric expansion onto distribution channels that has resulted in the network posting record profits for a startup.  Chris Bevilacqua can be considered the pioneer of a conference-focused TV network, after having co-founded the CSTV network which was sold to CBS.

Personally, that is overwhelming evidence that this is the direction the conference will go. With the track record of success that those players have in this arena, I would have 100 percent confidence that it would be a profitable endeavor.

The main issue that the conference needs to determine before working out the details, is the revenue sharing.  If the Big Ten model is followed, each conference member is an equal partner in the venture, with an equal sharing of profits and losses.  The Pac-10 must reconcile if they will have each member as an equal partner in BOTH equity AND profits.

Maintaining the status quo of a 60/40 split in profits between the teams that get more air-time will create a significant imbalance in power down the road.  Unequal revenue sharing among partners will lead to "power grabs" among the currently elite schools and a sense of bitterness among the currently underperforming schools.

Just ask any former Big 12 member.

A partnership needs to be just that.  A partnership, not a limited partnership.

 

Conference Schedule

The Pac-10 has made the gutsy decision to play an entire round robin in football which results in nine games for each school.  Obviously, in an expanded conference this becomes more and more difficult.  The full round robin will be scrapped, but the nine game slate could remain.

Kevin Weiberg has hinted that a 16 team conference would have each division play a round robin, with two inter-divisional games.  The push towards "super-conferences" could result in less out of conference games available, so maintaining the nine game slate could be the highest revenue producing option for the conference.

The TV package could be even bigger with more in-conference games to air on their own network.  What about 10 conference games?

If a "pod system" that utilizes four "pods" of four teams rotating to makeup two divisions is utilized, that creates the ability to do some creative scheduling.

How about two conference games EACH season against your rivals, one home and one away every year?  Taking a page from the NFL scheduling for the rivalry games or even for the "pod-mates" would be a revolutionary idea applied to college football.

And this is another point, the divisional format will be TWO divisions, not four four-team divisions.  The NCAA mandates that in order for a conference championship game to be an "exempt" game (not count towards the 12-game maximum) then the two teams must be decided between the champions of each division.  Each divisional champion must be determined by a full round robin with at least six teams in each division (NCAA Bylaw 17.9.5.2(c).

That leads us to the next item...

 

Football Championship Game

Whether or not to have a championship game in football is certainly debatable.  The ACC expanded to 12 teams in 2005 but were not able to capitalize on the championship game as much as they initially expected, with a mere $5 million annually.  The Big 12 and SEC were able to build a big enough event around the game to draw $10 to 15 million per year in revenue.

The Pac-10 currently has a widespread fanbase, with varying degrees of "football fanaticism."  While the Rose Bowl certainly attracts fans like moths to a flame, the other bowl games suffer from a lack of interest.  Will the Pac-10 schools be able to rally around the championship game enough to guarantee an annual sellout and above average TV ratings?

That is a big question that Larry Scott and his media contacts will have to answer.

In all other sports, the championship game revenue is split equally among conference members, so the assumption would be that would hold true for football as well.

Choosing a host site for the championship game, or a rotation of host sites, could depend greatly upon the makeup of the league with 12 teams or 16.

Ease of access, large number of hotel rooms, a premiere facility, and affordable travel will contribute to placing the locale.  The University of Phoenix Stadium in Glendale, Arizona seems to be the best location when all factors are weighed in.  At least until an NFL stadium is constructed in the Los Angeles area.

To help offset the North/South divide in exposure, it would make sense for the conference to explore hosting the basketball tournament in Northern California (Sacramento, San Francisco, Oakland, San Jose) or in the Northwest (Seattle, Portland); but possibly even in Las Vegas, Nevada to draw greater exposure to the event.

 

The Mountain Pacific Sports Federation

Probably the single most overlooked entity in western college athletics realignment issues, is the MPSF .

What is the MPSF?

In a nutshell, the MPSF is designed to "provide championship competition for Division I intercollegiate Olympic sports in a conference setting" as well as "to ensure the survival of sports impacted by Title IX and other fiscal pressures."

With many programs in the western U.S. having connections to the MPSF, including the Pac-10, the MWC, the WAC, and other conference members, these realignment shifts and conference-owned network programming are a big concern for the organization.

If (or when) the Pacific Conference decides to form a conference owned network, it could be either a boom or bust for the MPSF's sports.  If the Pac wants their members' participating sports "in the network" to the exclusion of the other teams then the MPSF could lose their best teams to the new superconference. 

However, the Pac could decide to utilize the larger membership of the MPSF as a source of content for the new network, and for the sports that the Pac doesn't currently sponsor.

 

The Granddaddy and Baby Bowls

The Rose Bowl.  The single most important game in postseason college football plays host to the champion of the Pac-10 and Big Ten.  For nearly a full century the bowl game in Pasadena has provided the greatest spectacle and revenue generating ability for the participating teams.

Will the Rose Bowl be a willing participant in a 2+1 style playoff, that features the champions of the four "super-conferences?"  If the Pac, Big Ten, SEC, and ACC all expand to 16 teams with the goal of creating a major football playoff format that they control, will the Rose Bowl be willing to be a semi-final host site, or part of a rotating site with the Sugar Bowl and/or the Orange and Cotton?

What will happen to the Big 12's tie-in with the Fiesta Bowl?

Some analysts have predicted that the Pac-16 can broker a deal to have the western division champion (the original Pac-8 members) play in the Rose Bowl, with the eastern division champion playing in the Fiesta Bowl.

It is hard to predict how that arrangement would work for the Pac-16, but it might be possible if the other super-conferences broker a similar deals in the BCS, but their aren't enough seats for that game of musical chairs without excluding the mid-majors and risking further congressional oversight in the process. 

Even if that wasn't a concern, there would have to be significant revamping of the BCS formula and contracts to allow that, and that is too much workload in the current environment to be a realistic goal at this time.

A more likely scenario is that the new Pac-12 or 16 could pickup the Cotton Bowl as a bowl tie-in if they are able to pull in four new schools from among the Texas/Oklahoma region.

Prior to the Pac-10 expansion bonanza, they were able to broker a deal to increase the Alamo Bowl payout and raise it to the second spot in the conference's bowl game pecking order. This will help the Pac-10 increase exposure into the Lonestar State, regardless of further expansion, but the potential demise of the Big 12 could leave this bowl game without a partner tie-in.  Ditto for the Holiday Bowl that pairs the Pac-10 versus the Big 12.

I have long held the belief that the Pac-10 needs to have a premiere bowl game affiliation with the SEC, and what better venue than either the Dallas based Cotton Bowl or the San Antonio based Alamo Bowl games? Or Both?

And how about moving the top Mountain West team to the Holiday Bowl?  If that conference is unable to earn an automatic qualifier status to the BCS, or if the BCS ceases to exist, then sending their champion to the Holiday Bowl against a Pac-10 team could be a great revenue earner for both conferences.

 

Conclusion

The Pac-10 has finally broken out of their 30-year isolationism, and have embraced the modern age of collegiate conferences.  This bold move will surely be followed by more, and the leadership of the conference has proven to be acute at decision-making and the future is bright for the Conference of Champions.

What the next round of action holds for the conference will undoubtedly be just as exciting as the last six months, but the above items will truly dictate how successful the future of the conference can be.

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For some discussion of how a 12-team divisional alignment could go, please see my earlier article:

Pac-10 Expansion Solutions: Division Dilemma

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