Conference Realignment

[UgaBlows]

Do you really think VT or NCState would add incremental value to the SEC? Why do you think 8 teams from the ACC would go to SEC and Big10? I think you’re looking at this the wrong way. The SEC and Big10 don’t care who gets left out. They only care about what adds incremental value to their conferences.

If they want to break the ACC apart ahead of the GOR’s expiration they need 8 teams to work together to vote to dissolve the conference correct? To achieve that they are going to have to promise landing spots for 8 teams.

 

[RonJohn]

If they want to break the ACC apart ahead of the GOR’s expiration they need 8 teams to work together to vote to dissolve the conference correct? To achieve that they are going to have to promise landing spots for 8 teams.

The GOR contract that I read said nothing about 8 teams. It basically said that the current ACC teams would own the rights to every school that leaves. Take away 8 teams and the 7/8 remaining could just live off of the broadcast rights of the 8 that left.

 

[cpf2001]

The SEC/B1G would need to bring over enough teams to have TV and advertising revenue growth. I’m not convinced a Midwest/South two-super-league situation does that with much of the rest of the country no longer invested at all. Even in LA, UCLA and USC playing a bunch of teams 2-3000 miles away is not necessarily a recipe for long term success given all the competing teams in the city.

I don’t think an NCST moves the needle on that, though.

But the consolidation is interesting since every pro league has chased growth through overall expansion and parity-promoting measures, and the SEC/B1G are doing basically the opposite for the game of CFB.

 

[orientalnc]

The GOR contract that I read said nothing about 8 teams. It basically said that the current ACC teams would own the rights to every school that leaves. Take away 8 teams and the 7/8 remaining could just live off of the broadcast rights of the 8 that left.

The issue with that is product under contract with ESPN would have changed and given ESPN the legal right to exit the agreement. Without the TV revenue, the conference dissolves. I will be surprised if it happens in the next 5-10 years.

 

[UgaBlows]

The rumor is that 8 ACC schools could force a majority vote to dissolve the GOR, i’ve just read that in an Atlantic article, no idea if true, accurate, possible or even remotely likely.

 

[stinger 1957]

Do you really think VT or NCState would add incremental value to the SEC? Why do you think 8 teams from the ACC would go to SEC and Big10? I think you’re looking at this the wrong way. The SEC and Big10 don’t care who gets left out. They only care about what adds incremental value to their conferences.

A VT alum friend of mine who over the years seems to have really good knowledge of what is going on there told me the other day that not long after VT joined the ACC the SEC approached them about joining their conference. VT told them after all the political fight they had joining the ACC they could not at that time consider any such move. If I remember correctly the ACC and the SEC were not real far apart in their TV revenue, it began to separate over the time after that.
What's my point? If the SEC wanted them then I see it possible they could want them now. I can see the SEC wanting to be in NC and VA especially if the Big is coming down the eastern side of the US to GA and FL. I'm guessing the SEC competition will make both VT and NC St. better and more competitive. They both represent good TV mkts, VT does better in the DC metro plex than UVA my friend says.

 

[RonJohn]

The issue with that is product under contract with ESPN would have changed and given ESPN the legal right to exit the agreement. Without the TV revenue, the conference dissolves. I will be surprised if it happens in the next 5-10 years.

That still would not matter regarding the broadcast rights for the schools who leave the conference. The GOR means that the ACC owns the broadcast rights for those schools. If ANYONE wants to broadcast the sports events of the members that leave the conference, they would have to negotiate with the "current" members of the ACC. For example, if Clemson leaves, Clemson cannot broadcast their sports events. The contract states that the Clemson would have to allow the ACC to broadcast those events, and Clemson would have to assist the ACC in broadcasting those events. In that scenario, if ESPN wants to broadcast Clemson games, then they have to negotiate with the ACC instead of Clemson because Clemson does not own those broadcast rights until after 2036.

 

[orientalnc]

That still would not matter regarding the broadcast rights for the schools who leave the conference. The GOR means that the ACC owns the broadcast rights for those schools. If ANYONE wants to broadcast the sports events of the members that leave the conference, they would have to negotiate with the "current" members of the ACC. For example, if Clemson leaves, Clemson cannot broadcast their sports events. The contract states that the Clemson would have to allow the ACC to broadcast those events, and Clemson would have to assist the ACC in broadcasting those events. In that scenario, if ESPN wants to broadcast Clemson games, then they have to negotiate with the ACC instead of Clemson because Clemson does not own those broadcast rights until after 2036.

Why would ESPN negotiate with the ACC for the right to stream Clemson games when they already own those rights? The real issue comes when the SEC says Clemson TV rights belong to the SEC. That's when ESPN bows out of the ACC contract. Without the eight most attractive teams the cost is not worth the revenue.

 

[RonJohn]

Why would ESPN negotiate with the ACC for the right to stream Clemson games when they already own those rights? The real issue comes when the SEC says Clemson TV rights belong to the SEC. That's when ESPN bows out of the ACC contract. Without the eight most attractive teams the cost is not worth the revenue.

The issue with that is product under contract with ESPN would have changed and given ESPN the legal right to exit the agreement. Without the TV revenue, the conference dissolves. I will be surprised if it happens in the next 5-10 years.

THAT is the point of the GOR. IF Clemson leaves the ACC to join the SEC, the SEC will not own the rights to the Clemson games. You are correct that ESPN already has a contract to broadcast the ACC games. However, you are incorrect in thinking that the contract with ESPN would have changed, and that ESPN could just pull out of the contract with the ACC. The Clemson games would still belong to the ACC. The ACC would still get the revenue from the Clemson games. ESPN could still broadcast those games under the current ESPN/ACC contract.

The big problem with teams leaving the ACC is that they do not bring any broadcast revenue opportunities to another conference. My post that you originally responded to was saying that the GOR contract provides that any current teams in the ACC still own the broadcast rights of any teams who leave the conference. (at least the previous GOR which is publicly available) I have not seen anything other than wild speculation that 8 teams leaving the conference would invalidate the GOR. (In fact the GOR specifically says the it can only be modified if EVERY current member votes to modify it.)

One thing to think about is how Texas exited the Big12. Texas has more money than any other NCAA sports program. Their yearly sports revenue is around $240 million. They could easily forgo two years' worth of broadcast revenue without it affecting their budget significantly. If ANY program has the ability to challenge a GOR, it is Texas. If they challenged and lost, it would have been painful, but more like a bruise than broken bones. They decided to wait instead of challenging it.

EDIT: I just looked up the 2022 numbers and Ohio State had more revenue than Texas. However, the next team below Texas was $24 million below Texas in revenue. Ohio State - $251 million, Texas $239 million, Alabama $214 million. Of that $239 million, only $42 million was from broadcast rights. If they had forgone the broadcast revenue, they would still have had more revenue than all but 5 NCAA athletic departments. The ACC school with the most revenue was Virginia at $161 million. $42 million of that was broadcast rights. That would hurt Virginia a lot more than Texas. (What I called "broadcast rights" is actually media and NCAA distributions in that report)

 

[roadkill]

Why would ESPN negotiate with the ACC for the right to stream Clemson games when they already own those rights? The real issue comes when the SEC says Clemson TV rights belong to the SEC. That's when ESPN bows out of the ACC contract. Without the eight most attractive teams the cost is not worth the revenue.

Not to pile on (well maybe a little bit) since this topic has been beaten to death already, but there are so many false assumptions in this post I have to respond.
"...ESPN...when they already own the rights?" The ACC owns the media rights, not ESPN. The ACC has a media broadcast contract with ESPN.
"...SEC says Clemson TV rights belong to the SEC." Huh? The SEC saying that doesn't make it true. That would be an idiotic thing for the SEC to say when it's clearly not true.
"That's when ESPN bows out of the ACC contract. " Sure. I'd love to just "bow out of" a contract like my mortgage. Sadly, contracts don't that way.

 

[orientalnc]

If I sign a contract with you to buy n widgets and you can provide only n/2 widgets, I am not going to pay for n widgets. If the n/2 widgets you can ship are of lower quality, I am going to want to pay less per widget. Maybe I don't want the lower quality widgets at any price.

If the 8 most attractive ACC teams bolt to the SEC and B1G, I am willing to bet the corner office guys at ESPN are going to say the number of games and the quality of the teams playing is not what they agreed to. They are going to void the TV contract or demand a lower price for the remining games.

 

[RonJohn]

If I sign a contract with you to buy n widgets and you can provide only n/2 widgets, I am not going to pay for n widgets. If the n/2 widgets you can ship are of lower quality, I am going to want to pay less per widget. Maybe I don't want the lower quality widgets at any price.

If the 8 most attractive ACC teams bolt to the SEC and B1G, I am willing to bet the corner office guys at ESPN are going to say the number of games and the quality of the teams playing is not what they agreed to. They are going to void the TV contract or demand a lower price for the remining games.

If the 8 most attractive ACC teams bolt from the ACC, the ACC STILL OWNS the broadcast rights. The quality of teams playing on ACC broadcast rights games has not changed. If ESPN were to void the contract, then they would have to negotiate for the rights to broadcast the games of those 8 teams WITH THE ACC.

 

[orientalnc]

I think we are missing the connection with each other. ESPN owns the right to broadcast ACC home games for the existing collection of ACC teams. If that number changes, the number of home games available to ESPN changes. Let's use GT as an example. Fox owns the rights broadcast to B1G home games. If GT leaves to ACC and joins the B1G, ESPN loses all the broadcast rights to GT home games. The ACC gets the GT share of the Fox money until 2036. ESPN gets nothing. The suits at ESPN are not going to stand by and do nothing. They have lost something of value and will want a new ACC contract. Or maybe no ACC contract at all.

 

[RonJohn]

I think we are missing the connection with each other. ESPN owns the right to broadcast ACC home games for the existing collection of ACC teams. If that number changes, the number of home games available to ESPN changes. Let's use GT as an example. Fox owns the rights broadcast to B1G home games. If GT leaves to ACC and joins the B1G, ESPN loses all the broadcast rights to GT home games. The ACC gets the GT share of the Fox money until 2036. ESPN gets nothing. The suits at ESPN are not going to stand by and do nothing. They have lost something of value and will want a new ACC contract. Or maybe no ACC contract at all.

I think you are misunderstand the GOR. It states that the conference owns all rights to broadcast the games of each member who signed the GOR, whether the member remains a member of the conference. It does not state that the conference will get any money from another agreement that the member institutions enter into. GT cannot take it's broadcast rights to the Big10. If the Big10 were to agree to pay money to GT, even without access to broadcast rights for games in Atlanta, the ACC would have no ability to snatch that money from GT. FOX would not broadcast Big10 games in Atlanta, ESPN would under the ACC contract.

 

[yeti92]

I think we are missing the connection with each other. ESPN owns the right to broadcast ACC home games for the existing collection of ACC teams. If that number changes, the number of home games available to ESPN changes. Let's use GT as an example. Fox owns the rights broadcast to B1G home games. If GT leaves to ACC and joins the B1G, ESPN loses all the broadcast rights to GT home games. The ACC gets the GT share of the Fox money until 2036. ESPN gets nothing. The suits at ESPN are not going to stand by and do nothing. They have lost something of value and will want a new ACC contract. Or maybe no ACC contract at all.

I don't think this is correct. In your example, I believe ESPN would still get to broadcast all GT home games through 2036, or whenever the current contract with the ACC runs through, because the ACC owns GT's media rights and has contracted them to ESPN. Fox doesn't get to air those games until the GOR runs out, or ESPN's contract with the ACC runs out if that happens first and the ACC decides to sell those rights to GT home games to Fox for the remainder of the GOR.

 

[RonJohn]

I think you are misunderstand the GOR. It states that the conference owns all rights to broadcast the games of each member who signed the GOR, whether the member remains a member of the conference. It does not state that the conference will get any money from another agreement that the member institutions enter into. GT cannot take it's broadcast rights to the Big10. If the Big10 were to agree to pay money to GT, even without access to broadcast rights for games in Atlanta, the ACC would have no ability to snatch that money from GT. FOX would not broadcast Big10 games in Atlanta, ESPN would under the ACC contract.

Nothing about getting money from another conference. Everything about the conference owing the broadcast rights to the games, even if a member school leaves the conference.

 

[slugboy]

I think we are missing the connection with each other. ESPN owns the right to broadcast ACC home games for the existing collection of ACC teams. If that number changes, the number of home games available to ESPN changes. Let's use GT as an example. Fox owns the rights broadcast to B1G home games. If GT leaves to ACC and joins the B1G, ESPN loses all the broadcast rights to GT home games. The ACC gets the GT share of the Fox money until 2036. ESPN gets nothing. The suits at ESPN are not going to stand by and do nothing. They have lost something of value and will want a new ACC contract. Or maybe no ACC contract at all.

The existing collection includes all current members, even if they go independent or join another conference. RonJohn posted it correctly above.

Some people have theorized that FSU could leave and play nothing but away games for 13 years, but it’s unclear whether that would work, or if it would be acceptable to their fans. The ESPN contract would be necessary to understand what’s “reserved to the conference and the member institution”, but it’s possible that it’s half the season, no matter where it’s played.

FSU’s AD has hinted that they’ve found a loophole, but he may be bluffing.

 

[orientalnc]

View attachment 14360
Nothing about getting money from another conference. Everything about the conference owing the broadcast rights to the games, even if a member school leaves the conference.

This is certainly different from any GOR I have read in the past. Assuming this is correct and current, then you are right. This being the case, I do not see how any ACC team will be moving to another conference until after 2036 unless the GOR is eliminated.

I found a reference to the ESPN contract with the ACC and it covers only "home" games. I am not sure how "home" is defined. Could GT play Ohio State at BDS and the B1G designate tOSU as the "home" team? Or could GT contract with GSU or MBS to play games in Atlanta as the "visiting" team? These ideas are probably far fetched. I wonder if the GA legislature could simply pass a law saying that Ga Tech cannot grant its media rights to any other entity. Not sure where FSU sees the loop hole, but I am sure there are numerous attorneys standing by just beyond the exit to "help" adjudicate that question.

 

[RonJohn]

Some people have theorized that FSU could leave and play nothing but away games for 13 years, but it’s unclear whether that would work, or if it would be acceptable to their fans. The ESPN contract would be necessary to understand what’s “reserved to the conference and the member institution”, but it’s possible that it’s half the season, no matter where it’s played.

FSU’s AD has hinted that they’ve found a loophole, but he may be bluffing.

Even playing all away games seems doubtful as a way to bypass the GOR. I don't know if the ESPN contract would allow that, but even if it does: FSU's revenue is $161 million. $41 million from media, $19 million from tickets, and $42 million from donors. They won't add a media market if they don't own the broadcast rights. They won't sell tickets if all of the games are away. Would donors continue to supply $42 million if there are no sporting events that they have good access to? Trying to exit the ACC and play all away games puts $103 million of their $161 million revenue at risk. That just seems far too risky to me.

EDIT: Like I said previously, Texas could actually afford to lose $80 million to go to the SEC two years before the Big12 GOR expired. They chose not to. ACC teams would be risking 12 years and no ACC team has as much revenue nor as much cash on hand as Texas.

 

[RonJohn]

This is certainly different from any GOR I have read in the past. Assuming this is correct and current, then you are right. This being the case, I do not see how any ACC team will be moving to another conference until after 2036 unless the GOR is eliminated.

I found a reference to the ESPN contract with the ACC and it covers only "home" games. I am not sure how "home" is defined. Could GT play Ohio State at BDS and the B1G designate tOSU as the "home" team? Or could GT contract with GSU or MBS to play games in Atlanta as the "visiting" team? These ideas are probably far fetched. I wonder if the GA legislature could simply pass a law saying that Ga Tech cannot grant its media rights to any other entity. Not sure where FSU sees the loop hole, but I am sure there are numerous attorneys standing by just beyond the exit to "help" adjudicate that question.

Here is the link to that document. It is from a NC radio station, who acquired it. It is signed by the UNC Chancellor from 2012. It is the 2013 agreement. I have not seen a copy of the 2016 agreement, but have read that it is very similar. https://wwwcache.wralsportsfan.com/...238/ACC-Grant-of-Rights-1-DMID1-5vgd1w2if.pdf