$60 million might sound like a lot. With that much in capital, you could buy two dozen Coachella tickets, three or four Boeing 737s and a five-star Caribbean resort (at least by my calculations).
But in the world of college football television contracts, the soon-to-be Pac-12’s $60 million in annual earnings is at the bottom of the barrel, making it, for all intents and purposes, a serf when it comes to TV revenue.
By comparison, the Big Ten reigns as king.
This year, the 11-member league produced $220 million in revenue — nearly four times as much as the Pac-10. Similarly, the SEC generated upward of $205 million.
But for the Pac-12, there is now an opportunity to alter that startling trend, as the conference’s current TV deal is set to expire after the 2011 season.
“I’ve felt all along that college sports is undervalued,” conference commissioner Larry Scott said last May, when asked about a potential new television contract. “And I think the Pac-10 is more undervalued than any conference.”
With Scott in the midst of negotiations with potential suitors, a new deal is imminent, expected to be reached at some point this summer.
Fortunately for Scott, if recent news surrounding the Big XII serves as any indication, a few more Benjamins are headed west.
If Big XII commissioner Dan Beebe can do it, frankly, anybody can.
Under the Big XII’s new deal, reached last Wednesday, the conference will receive an estimated $90 million annually from Fox Sports as part of a 13-year agreement for the conference’s broadcasting rights. And that’s just for cable.
“It is helpful to see such a significant increase in Big 12 rights,” Scott said through a spokesman Friday.
The Big XII also has a deal in place with ABC/ESPN worth roughly $40 million per season that runs through the 2015-2016 season. By the time the deal expires, the league and its members will have received more than $1 billion in revenue.
Still think $60 million is a lot?
Oddly enough, the popularity of DVRs and the online streaming of television programs on websites such as Hulu have made sports broadcasting rights all the more sought after these days.
Sports is the only type of programming that has been, and by all indications will continue to be, televised live. In short, commercials and advertisers still matter when it comes to sports programming, and as a result, TV contracts across all professional leagues and college athletic conferences have stayed lucrative in the past year.
According to the Sports Business Journal, the NHL is expected to sign a record media rights deal in the coming months, worth more than $200 million annually. And in January, ESPN and the University of Texas agreed to a 20-year, $300 million contract to launch a 24-hour television network to broadcast various Texas athletic contests.
That ain’t chump change.
Considering the recent trend, Scott has a fantastic opportunity to capitalize on the current climate by reaching his own sweetheart deal for the Pac-12.
As outlined by the Wall Street Journal on Saturday, the conference is seeking a deal worth $2.3 billion over 10 years, which would be worth four times as much annually as its current deal. It would also stipulate a commitment to launch a Pac-12 regional sports network akin to Fox’s Big Ten Network.
Though ESPN and Fox are considered to be in the mix for a potential deal, Comcast/NBC Universal remains the wild card, potentially making for an even bigger pay day for USC and the conference’s 11 other institutions.
In the last few weeks, it has been widely speculated by several media outlets that new NBC Universal CEO Steve Burke remains interested in forming a rival to ESPN, despite failed attempts to do so with Comcast’s Versus sports network.
But regardless of the network’s success, or lack thereof, in turning Versus into a viable competitor, NBC has dipped into its pockets for sports programming in the past, as seen with the Olympics.
It has lost money, but it has been willing to splurge.
And with the Pac-12 being the only major BCS conference outside of the Big East scheduled to renegotiate its TV rights deal before 2016, this could be the last great opportunity for Burke to make a splash in the world of college sports.
Regardless of Burke’s final decision, however, expect Scott’s negotiations to result in plenty of green lining the pacific coast.
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