Expansion Talk 2021

Northeast Stinger

Helluva Engineer
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5,172
Other than having fun on message boards or arguing with your neighbors, there really isn't much else to do but wait and see what happens. I am on the road in my RV and checking the board more frequently than my wife likes, so I am just as antsy as anyone. The reality is that we will likely have to wait for quite a while before the next shoe drops.
Time your check-ins on the road carefully.
😊
 

Northeast Stinger

Helluva Engineer
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5,172
The funny thing is that if the SEC replaces the NCAA as the king maker, eventually it will come under the same criticism. The SEC will adopt rules that bind other schools, block others from threatening their power and put in legal language that try to control everything.

in 20 years everyone will hate the SEC
You think it will take 20 years to hate the SEC? I must be an overachiever.
 

TooTall

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1,576
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Who doesn't like watching Ohio State play Alabama? Or OU play LSU? How about USC playing Florida? Texas playing Michigan? Clemson playing Tennessee? None of them have historical rivalries with each other, but the strength of their brands are going to make a LOT of people tune in.
Sounds alot like MLB when interleague play was starting out. And the result of that....low viewership of the All-Star game and World Series because viewers get to see NL vs AL in April thru September.
 

awbuzz

Helluva Manager
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Indeed, and WVA would replace a void left in that area by the departure of Maryland.

Nobody's paying much attention to natural regional rivals in all the alignment talk, and I think that may prove in the long run to be a mistake. They're paying so much attention to the immediate $$ gains of adding major schools halfway across the country, and in it all have forgotten what makes college football great - the rivalries.
Money talks, bullsqueeze doesn't pay bills unless you're turning into the compost and can sell it. Unfortunately that doesn't do too much to add dollars to the GT coffers.
 

awbuzz

Helluva Manager
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Marietta, GA
Nope, viewership doesn't matter one bit for subscriber fees.
As @RonJohn points out, for ESPN it's about subscriber fees when it comes to payments from the dish / directv/comcast/etc. Do not get those confused with advertising fees paid to ESPN by those purchasing commercial time. Those rates would be based upon eyes watching the programming.
 

GTRanj2

Helluva Engineer
Messages
1,209
ESPN is playing God right now. I think they want a viable alternative to the NFL and the NBA, and the SEC mega conference full of brands just might be it. FSU and Clemson being mentioned by multiple sources to the SEC is no coincidence, and the AD leaving FSU basically said FSU will do what's in the best interest of the program. The only people who don't see what's coming with all of the schools jockeying for position are fans who keep waxing nostalgic about tradition and regional rivalries. None of that matters anymore because a school's brand supercedes that. Who doesn't like watching Ohio State play Alabama? Or OU play LSU? How about USC playing Florida? Texas playing Michigan? Clemson playing Tennessee? None of them have historical rivalries with each other, but the strength of their brands are going to make a LOT of people tune in. That is what matters to ESPN...and other media networks. I think ESPN is tired of dealing and cowtowing to the NFL, and paying a LOT of money.

David Pollack mentioned that the SEC moves are likely in response to eventually pulling away from the NCAA altogether. The NCAA is not equipped to deal with the NIL and the business potential for both the SA and the schools. NCAA dragged their behinds trying to dodge NIL altogether insteading of accepting it and making sure all member schools abide by the same guidelines. Now it's a free for all, and schools are seeing that the NCAA is outdated and not prepared to help them with what's to come. The NCAA was useful during the "amatuer model" years, but that time is passing...as is the usefulness of the NCAA.

If you still believe Grant of Rights will prevent schools from moving, just pay attention to what's going on in the Big 12...and the ACC soon. If enough schools in a conference fight it, then it becomes worthless. Lawyers and giant media networks like ESPN will find a way for assets (schools) to move to other places that's in the best interest of making more money.
Few things here.

1. You're assuming ESPN is a healthy business with a strong future. I'm not so sure this is the case. They have an old business model tied down to many contracts related to cable tv subscriptions. The way they operate, much of the know how of the employees there is related to dealing with cable television and people in that business.
Currently, ESPN spend $5 per customer.
They charge $8 per customer. These are both monthly figures.

I think we can all agree that the future is direct to customer subscriptions, which is what I'm getting at. ESPN is a large and old machine that may or may not be able to adapt to it, with all of their infrastructure built to deal with cable tv.

Currently, as it stands, per Disney CEO (Disney owns ESPN) it would cost ESPN $15 per customer per month to go this route. Ain't gonna cut it while currently getting $8 from the customer per month.

They are ok right now as they still have plenty of cable tv subscriptions, but it is a clear trend that that is coming to an end.

Who's to say a newer more efficient and able network doesn't come in built right away for direct to customer model. (Think Netflix and Blockbuster). Who's to say ESPN will still be the same ESPN it is today in 2036?

2. Nobody has even said that the SEC is planning to add beyond OU and TX. I'm not buying it just yet, not saying it's impossible, I just don't see it. The Big 12 has been in a bad way ever since the last round of realignment. Since then, they have been pretty weak, and Oklahoma and Texas honestly haven't done much to carry the load (much more so with Texas). It is a very similar situation with when the ACC raided the Big East. Teams from the Big East wanted out of a failing conference and the ACC was happy to take them.

3. The remaining conferences are much stronger then the BIG 12 and will not just sit idly by if the SEC really is trying to start it's own league. The ACC is still the major power in basketball, and had had recent success in football as well (just been spun into less success by those with interest in the SEC). The B1G had also had similar success and are quite a healthy conference. They can surely hold their own against the SEC.

A really effective move to make in the short term is prevent the expansion of the playoffs to 12 teams.

4. The SEC is just a couple of bad future head coaching hires away from turning into what Texas has become. Trees don't grow to the sky and what goes up must come down. Most of the SEC's hype is due to Alabama (specifically Nick Saban), when they come back down to earth, the hype will eventually come with them (FSU, MIAMI... come to mind). I don't see Alabama being as lucky as OSU in getting two great head coaches in a row.

5. It's easy to allow greed to rush you into a hasty decision. All of these fans calling for their team to join some super conference of the SEC are more than ok with all of the tradition that would surely die with it. Lots of schools not currently hyped up would be left by the wayside, which is terrible. The point of sports in general isn't just money, it's about competition, tradition, rivalries, and the highs and lows of each team. Just like how trees don't grow forever, what is down won't stay down forever, but deals like this will ensure the unnecessary death of what could have a bright future.

Excuse any weird wording, wrote all this on my phone and the autocorrect can be crazy at times.
 
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RonJohn

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3,301
As @RonJohn points out, for ESPN it's about subscriber fees when it comes to payments from the dish / directv/comcast/etc. Do not get those confused with advertising fees paid to ESPN by those purchasing commercial time. Those rates would be based upon eyes watching the programming.
Keep in mind that the estimates for ESPN revenue are that 80% of their revenue is from subscriber fees. Only 20% is from advertising.

They will have to change that business model because of cord cutting. I haven't seen anybody indicate what they are going to replace that revenue with. I have seen wild speculation about it, but no statements from the company and no articles that actually cite evidence for their speculation. Just wild speculation on my part, but I think Disney would like to push to get as much revenue out of the current business model as possible before changing tactics and reducing this revenue even more. How many people would cut the cord if they could get a streaming package from ESPN for college football?
 

roadkill

Georgia Tech Fan
Messages
26
Keep in mind that the estimates for ESPN revenue are that 80% of their revenue is from subscriber fees. Only 20% is from advertising.

They will have to change that business model because of cord cutting. I haven't seen anybody indicate what they are going to replace that revenue with. I have seen wild speculation about it, but no statements from the company and no articles that actually cite evidence for their speculation. Just wild speculation on my part, but I think Disney would like to push to get as much revenue out of the current business model as possible before changing tactics and reducing this revenue even more. How many people would cut the cord if they could get a streaming package from ESPN for college football?
FYI - ESPN+ streaming service was launched in 2018 and has grown rapidly. Last quarter Disney reported 13.8M subs for ESPN+. It is currently priced at 6.99/mon or $70/year.
 

Techster

Helluva Engineer
Messages
14,131
Keep in mind that the estimates for ESPN revenue are that 80% of their revenue is from subscriber fees. Only 20% is from advertising.

They will have to change that business model because of cord cutting. I haven't seen anybody indicate what they are going to replace that revenue with. I have seen wild speculation about it, but no statements from the company and no articles that actually cite evidence for their speculation. Just wild speculation on my part, but I think Disney would like to push to get as much revenue out of the current business model as possible before changing tactics and reducing this revenue even more. How many people would cut the cord if they could get a streaming package from ESPN for college football?

Few things here.

1. You're assuming ESPN is a healthy business with a strong future. I'm not so sure this is the case. They have an old business model tied down to many contracts related to cable tv subscriptions. The way they operate, much of the know how of the employees there is related to dealing with cable television and people in that business.
Currently, ESPN spend $5 per customer.
They charge $8 per customer. These are both monthly figures.

I think we can all agree that the future is direct to customer subscriptions, which is what I'm getting at. ESPN is a large and old machine that may or may not be able to adapt to it, with all of their infrastructure built to deal with cable tv.

Currently, as it stands, per Disney CEO (Disney owns ESPN) it would cost ESPN $15 per customer per month to go this route. Ain't gonna cut it while currently getting $8 from the customer per month.

They are ok right now as they still have plenty of cable tv subscriptions, but it is a clear trend that that is coming to an end.

Who's to say a newer more efficient and able network doesn't come in built right away for direct to customer model. (Think Netflix and Blockbuster). Who's to say ESPN will still be the same ESPN it is today in 2036?

2. Nobody has even said that the SEC is planning to add beyond OU and TX. I'm not buying it just yet, not saying it's impossible, I just don't see it. The Big 12 has been in a bad way ever since the last round of realignment. Since then, they have been pretty weak, and Oklahoma and Texas honestly haven't done much to carry the load (much more so with Texas). It is a very similar situation with when the ACC raided the Big East. Teams from the Big East wanted out of a failing conference and the ACC was happy to take them.

3. The remaining conferences are much stronger then the BIG 12 and will not just sit idly by if the SEC really is trying to start it's own league. The ACC is still the major power in basketball, and had had recent success in football as well (just been spun into less success by those with interest in the SEC). The B1G had also had similar success and are quite a healthy conference. They can surely hold their own against the SEC.

A really effective move to make in the short term is prevent the expansion of the playoffs to 12 teams.

4. The SEC is just a couple of bad future head coaching hires away from turning into what Texas has become. Trees don't grow to the sky and what goes up must come down. Most of the SEC's hype is due to Alabama (specifically Nick Saban), when they come back down to earth, the hype will eventually come with them (FSU, MIAMI... come to mind). I don't see Alabama being as lucky as OSU in getting two great head coaches in a row.

5. It's easy to allow greed to rush you into a hasty decision. All of these fans calling for their team to join some super conference of the SEC are more than ok with all of the tradition that would surely die with it. Lots of schools not currently hyped up would be left by the wayside, which is terrible. The point of sports in general isn't just money, it's about competition, tradition, rivalries, and the highs and lows of each team. Just like how trees don't grow forever, what is down won't stay down forever, but deals like this will ensure the unnecessary death of what could have a bright future.

Excuse any weird wording, wrote all this on my phone and the autocorrect can be crazy at times.

I think the new model is already out there: Netflix, HBO, Prime Video, Hulu.

Keep in mind, it isn't only about subscribers, it's also about selling data.


It's why Facebook, and Google are so valuable outside of its main purpose. Data is the new oil...and tech companies are reaping in a LOT of mony for that data. It's only natural other businesses are trying to mine for it. This is why "brand name" teams are more important than teams in certain markets. Those brand name teams will drive subscribers...and ESPN/SEC/B1G look to corner the market on college brand names forcing loyal fanbases to subscribe to their services.

Also remember, leagues like the NFL/NBA/MLB are selling one product. Conferences have multiple sports they can sell for year round revenue streams. With NIL, SEC (or any other conference) can work with star athletes to spin shows (think Lebron James barbershop show, or Tom Brady Facebook specials) or create media with them to also create ancillary value to the channel, and return, boost NIL value for athletes. Really, this has the potential to dwarf pro leagues because of the many ways the conferences and the SEC can create value in various sports that single sports pro leagues can't.

Like I keep saying, the SEC is probably think on an entirely different level than most of us probably can comprehend at the moment.
 

WreckinGT

Helluva Engineer
Messages
1,830
ESPN is playing God right now. I think they want a viable alternative to the NFL and the NBA, and the SEC mega conference full of brands just might be it. FSU and Clemson being mentioned by multiple sources to the SEC is no coincidence, and the AD leaving FSU basically said FSU will do what's in the best interest of the program. The only people who don't see what's coming with all of the schools jockeying for position are fans who keep waxing nostalgic about tradition and regional rivalries. None of that matters anymore because a school's brand supercedes that. Who doesn't like watching Ohio State play Alabama? Or OU play LSU? How about USC playing Florida? Texas playing Michigan? Clemson playing Tennessee? None of them have historical rivalries with each other, but the strength of their brands are going to make a LOT of people tune in. That is what matters to ESPN...and other media networks. I think ESPN is tired of dealing and cowtowing to the NFL, and paying a LOT of money.

David Pollack mentioned that the SEC moves are likely in response to eventually pulling away from the NCAA altogether. The NCAA is not equipped to deal with the NIL and the business potential for both the SA and the schools. NCAA dragged their behinds trying to dodge NIL altogether insteading of accepting it and making sure all member schools abide by the same guidelines. Now it's a free for all, and schools are seeing that the NCAA is outdated and not prepared to help them with what's to come. The NCAA was useful during the "amatuer model" years, but that time is passing...as is the usefulness of the NCAA.

If you still believe Grant of Rights will prevent schools from moving, just pay attention to what's going on in the Big 12...and the ACC soon. If enough schools in a conference fight it, then it becomes worthless. Lawyers and giant media networks like ESPN will find a way for assets (schools) to move to other places that's in the best interest of making more money.
I actually don't think the ACC is in any immediate danger. The SEC isn't going to take FSU and Clemson because the financial incentive for ESPN to do that simply isn't there. They don't provide new markets for the SEC and ESPN already owns all TV rights for both programs. If they did move them to the SEC then the ACC pretty much implodes. Some of the ACC members are likely going to the Big 10, which is probably the last thing that ESPN wants. Plus ESPN doesn't have to renegotiate the ACC deal for 14 more years aside from check ins and possible expansion which they would control. Im not sure why they would want to get rid of it now unless they were just looking to cut costs substantially.
 

BurdellJacket

Jolly Good Fellow
Messages
370
Location
Atlanta
They will have to change that business model because of cord cutting. I haven't seen anybody indicate what they are going to replace that revenue with. I have seen wild speculation about it, but no statements from the company and no articles that actually cite evidence for their speculation. Just wild speculation on my part, but I think Disney would like to push to get as much revenue out of the current business model as possible before changing tactics and reducing this revenue even more. How many people would cut the cord if they could get a streaming package from ESPN for college football?

Very good post and I agree with everything except that I think you can still get ESPN while streaming either Hulu or YouTube TV or possibly even Sling.
 

Techster

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Messages
14,131
I actually don't think the ACC is in any immediate danger. The SEC isn't going to take FSU and Clemson because the financial incentive for ESPN to do that simply isn't there. They don't provide new markets for the SEC and ESPN already owns all TV rights for both programs. If they did move them to the SEC then the ACC pretty much implodes. Some of the ACC members are likely going to the Big 10, which is probably the last thing that ESPN wants. Plus ESPN doesn't have to renegotiate the ACC deal for 14 more years aside from check ins and possible expansion which they would control. Im not sure why they would want to get rid of it now unless they were just looking to cut costs substantially.

Again, it's no longer about markets. We need to stop thinking about the old media revenue model. It's about content that will drive in subscribers.

Think of it like boxing. When you have marquee names fighting each other, pay per view buys get driven up. Do you think boxing promotions care that Floyd Mayweather is from Las Vegas and Manny Pacquiao is from the Phillipines? No, because those names were marquee names that drew fans who were beyond the normal boxing fans to buy the event. Well, if the SEC has the biggest names in college sports (not just football), subscription fees get driven up. Names and matchups are more important than markets now.

Thinking of it in the old media market terms is missing the point. Why do you think Netflix/Hulu/Amazon Prime are signing up the best directors/stars/franchises/etc? Because they know it adds value to their subscriptions. They are creating premium content to pique the interest of subscribers. Same difference with sports: SEC wants the marquee names to drive interest in their subscription base.
 

WreckinGT

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1,830
Again, it's no longer about markets. We need to stop thinking about the old media revenue model. It's about content that will drive in subscribers.

Think of it like boxing. When you have marquee names fighting each other, pay per view buys get driven up. Do you think boxing promotions care that Floyd Mayweather is from Las Vegas and Manny Pacquiao is from the Phillipines? No, because those names were marquee names that drew fans who were beyond the normal boxing fans to buy the event. Well, if the SEC has the biggest names in college sports (not just football), subscription fees get driven up. Names and matchups are more important than markets now.

Thinking of it in the old media market terms is missing the point. Why do you think Netflix/Hulu/Amazon Prime are signing up the best directors/stars/franchises/etc? Because they know it adds value to their subscriptions. They are creating premium content to pique the interest of subscribers. Same difference with sports: SEC wants the marquee names to drive interest in their subscription base.
Like RonJohn basically said, the old revenue model isn't going away any time soon. ESPN and the SEC make the vast majority of itheir money off of subscribers who don't even want their channel. They aren't cutting over to a pure demand based streaming service until they absolutely have to and it seems really unlikely that they can produce the same level of revenue even with bloated subscription costs.
 

RonJohn

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3,301
FYI - ESPN+ streaming service was launched in 2018 and has grown rapidly. Last quarter Disney reported 13.8M subs for ESPN+. It is currently priced at 6.99/mon or $70/year.
You also get ESPN+ if you subscribe to Disney+. You don't get access to ESPN, ESPN2, SECN, ACCN, or ESPNU content with ESPN+. You do get access to some of those sports programs as replay, but you can't watch an ESPN live game with an ESPN+ subscription. Using those numbers, they can bring in about $1 billion for ESPN+. The estimates are that they bring in about $8 billion for the ESPN channel alone. Once you add in ESPN2, SECN, ACCN, ESPNU, etc. I have seen estimates that they bring in $14-$16 per subscriber. Much of that is spread across subscribers who do not watch and do not want ESPN. Just spitballing numbers, if the ESPN suite brings in $12 per subscriber with 80 million subscribers and only 30% actually want sports, they will have to charge $40 per streaming subscriber to have the same revenue. They would need to have that across 12 months, not just allow people to sign up when the sport they are interested in is starting and cancel when it is over.


They are working on things, but I have not seen anything that looks like it could replace their previous revenue. They were able to pull in much more revenue than their product was worth by leveraging the audience that they do have to hijack subscription fees from people who never wanted their content. It will be a struggle for them.
 

RonJohn

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3,301
Very good post and I agree with everything except that I think you can still get ESPN while streaming either Hulu or YouTube TV or possibly even Sling.
I don't consider people who have Hulu Live TV, YoutubeTV, or Sling as cord cutters. Sure they don't have cable or sat, but they still pay for live channel packages, and the rates are slowly creeping up to sat/cable rates.
 

RonJohn

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3,301
Again, it's no longer about markets. We need to stop thinking about the old media revenue model. It's about content that will drive in subscribers.

Think of it like boxing. When you have marquee names fighting each other, pay per view buys get driven up. Do you think boxing promotions care that Floyd Mayweather is from Las Vegas and Manny Pacquiao is from the Phillipines? No, because those names were marquee names that drew fans who were beyond the normal boxing fans to buy the event. Well, if the SEC has the biggest names in college sports (not just football), subscription fees get driven up. Names and matchups are more important than markets now.

Thinking of it in the old media market terms is missing the point. Why do you think Netflix/Hulu/Amazon Prime are signing up the best directors/stars/franchises/etc? Because they know it adds value to their subscriptions. They are creating premium content to pique the interest of subscribers. Same difference with sports: SEC wants the marquee names to drive interest in their subscription base.
I do agree that the future is not in media markets. However, the revenue that sports has been getting has been extremely heavily subsidized by people who do not watch sports and would not willingly pay $1 per month for sports. Those people have been providing somewhere between 60-70% of the subscription revenue.

Will you pay $40 to watch ND vs USC? Will you pay $10 to watch ND vs USC? The SEC is getting big names, but will people in California pay $40 to watch Texas vs Alabama? If they don't do ppv, but a college football subscription, are you willing to pay $40 or $60 per month for that? What if you have to sign a 12 month agreement in order to get it? That is probably the level of pricing ESPN would need to have the same level of revenue as traditional TV subscriptions. If they do charge that, how many individual houses are going to sign up? How many people are going to pool an account to split the subscription 4 or 5 ways? That would reduce the revenue that ESPN gets, and Disney might take steps to prevent it.

I am not trying to argue that the current market based business model will work forever. In fact, I have stated that it is falling apart. There are a few problems with replacing it. The first is the fact that sports have been subsidized by non-sports subscribers. The second is that college football is regional. I hardly ever watch Big10 games. I rarely watch Pac12 games. I might watch a G5 game once in a while if it is the only thing on. The SEC expansion looks huge, but do people in Washington state care? Do people in the Northeast? Do people in the Midwest? They might be interested, but are they willing to pay money?

The business model will change, but I don't think there is a clear picture on what it will change to. Many people have speculations, but nobody during the Betamax vs VHS format war would have even suggested that in 30 years the future of movies would be streaming thru a cable to your house on demand.
 

Techster

Helluva Engineer
Messages
14,131
Like RonJohn basically said, the old revenue model isn't going away any time soon. ESPN and the SEC make the vast majority of itheir money off of subscribers who don't even want their channel. They aren't cutting over to a pure demand based streaming service until they absolutely have to and it seems really unlikely that they can produce the same level of revenue even with bloated subscription costs.

No offense to @RonJohn , one of the better posters on here whose opinion I hold in high regard, but none of us knows the ultimate plan here...but if you look at where everything is headed (one off "premium" subscribtions like HBO max, ESPN+, NBC Peacock Premium, etc), and the rumored schools that are being attached to the SEC (big name 'brands"), you can read the tea leaves.

At some point, the old revenue model makes zero sense because of the velocity at which "cord cutters" are leaving the old model. This move isn't about today or 5 years from now, it's about decades from now. This isn't just for the SEC, but ESPN as well...it's why the current business model is starting to lose money. This is why the SEC is has been ahead of everyone one else, outside of the B1G, at every turn. If the B1G doesn't think strategically, they could be in trouble as well.

There will come a day where the only way to watch Alabama versus LSU, or Texas versus OU, Clemson vs UGA...basically all of the Tier One matchups is through the premium SEC Network subscription. SEC network currently has 70 million subscribers. It cost $65 to get SEC Network through Hulu, $99 for NFL Game Pass. Do math on when the those 70 million subscribers (that's BEFORE Texas and OU...maybe Clemson/FSU/etc join) have to all pay $65-$100 to watch SEC games (football/basketball/baseball/etc.). You could see sports leave the networks altogether to go subscription platforms only. It would have been unheard of years ago, but now that's where almost everything that use to be on TV is going.
 

CLHarperJackt

Georgia Tech Fan
Messages
38
The idea I like most is an Atlantic-Pacific Coast Conference by attempting to raid the PAC-12.

Take the 14 teams we have now, add USC, UCLA, Oregon, & Washington. That gets you to 18. With the addition of Notre Dame's primary rival, you make it more enticing to them. The goal is to get to 20 by adding one more (assuming you can convince ND... big if).

With the last spot, you can go for rivalries vs. TV markets. Take WVU and you get some great old school Big East matchups. Take Navy to get a very strong service academy and you make it more enticing to Notre Dame to join. Plus, you add the Navy vs. Army game every other year and ND vs. Navy at least every other year from a TV standpoing.

At 20 teams, you have 4 pods with something like the below (this is pretty unbalanced, but you get the idea):

GT, FSU, Clemson, Wake, NC State
USC, UCLA, Wash, Oregon, ND
UNC, Duke, Wake, UVA, Louisville
Miami, BC, WVU/Navy, Pitt, VT

Travel isn't ideal for the west coast teams, but they get at least 4 games on the west coast against teams in their pod. Then the remaining 4/5 games are split home/away, so they're only leaving to go east for 2/3 games.
If you go this route, then I would replace UCLA with Stanford.
 
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