University of Texas' Deal With ESPN May Be a Model For Other Schools

Recently, the University of Texas agreed to a 20-year, $300 million contract with ESPN. Some say this marked the beginning of universities having their own 24-hour cable network.  UT essentially has become an independent and one wonders whether or not UT was the main cog in blocking a number of Big 12 schools from joining the Pac-10.  Did UT leverage so they would be granted the network? Did Big 12 officials cave in to their desire for a network while the Pac-10 refused? 

Many of the writers across the land have argued that this is a bad thing for college football.  Drew Sharp of the Detroit Free Press writes, “The historic launching of the University of Texas' own 24-hour sports cable network is as much an affirmation of enormous ego as it is commerce. Texas wanted to be the first athletic conglomerate on the block with its own channel.”

Sharp goes on to write, “Texas officially became an "independent" with this exclusive network deal. The Big 12 is nothing more than a convenient scheduling partner for the Longhorns now. How long before the Big Ten gets caught in the ripple effects? How long before Ohio State, the second-biggest revenue producer in all college sports, envisions its own exclusive "Buckeye Network" and seeks a spinoff from the Big Ten Network?”

“The NCAA must look closely at an exclusive 24-hour channel tied to one institution. It's basically a paid commercial for the school. Texas already enjoyed a tremendous recruiting advantage over its closest neighbors, especially in football and basketball. But does 24 hours of "Hook 'Em Horns" constitute an unfair recruiting advantage?”

Sharp goes on to write, “It further tips the competitive scales in the favor of those with the deepest pockets. But Texas' attitude is ‘If you can't beat us, tough. Try to join us.’ The Longhorns' 20-year, $300-million deal with ESPN , which will nationally distribute the network, reportedly dwarfs Notre Dame's exclusive contract with NBC by about $6 million annually. It'll be hard for the other big boys, or at least those who kid themselves into believing that they're one of the big boys, to ignore.”

Sharp and others believe that the University of Texas has opened a can of worms that not only will continue to separate the “big boys” from schools like Boise State and Utah who already have enough challenges to face as they compete against the automatic qualifying conferences for national championships.

But what one has not factored in is the enormous challenges institutions face in light of a sagging economy.   Governor Rick Perry of Texas, foreseeing a financial deficit in the state has drastically slashed the budget towards higher education.  In a UT press release: “Gov. Rick Perry, Lt. Gov. David Dewhurst and House Speaker Joe Straus last month instructed state agencies including institutions of higher education to submit plans for the proposed budget cuts. The 5 percent cuts would be aimed at mitigating an estimated $4.3 billion budget gap in the current fiscal year, according to the state comptroller’s office.”

The UT press release goes on to say, “The budget cuts will be distributed across the institutions and the UT System administration. Of the $175.3 million in budget cuts, $78.1 million are at the nine academic institutions and $97 million at the six health institutions.”  UT System Chancellor Francisco G. Cigarroa, M.D. said, “During strained economic times, we must work together to meet challenges and help the state maintain critical services, including excellence in higher education and health care, that are important to all Texans.”

With the majority of the fifty states facing economic challenges, UT may be a model for other schools to follow: allow the private market to fund more of education.  Not just in donations but using the principles of commerce and business.  Though sportswriters across the land denounce the unfairness and competitive advantage given to UT, other institutions of higher learning may have to follow suit as states, like Texas, must begin to slash budgets in order to balance the budget.  UT may be a model instead of a monster, other schools will have to find creative ways to raise funds as tax dollars are drained away. 

All in all, this may not be too bad of a deal after all.