Expansion Talk 2021

Messages
2,034
You are missing the current business model. ESPN (including SEC Network and ACC Network) gets their money mainly from TV subscribers. Viewership rating mean extremely little. Every single person with a broadcast TV cable/sat/streaming package pays for ESPN, and the great majority pay for SEC and ACC (except Comcast for ACC). It doesn't matter if you ever watch a game on SEC Network, you pay for the SEC Network. It doesn't even matter if you never watch any sport whatsoever and only watch Lifetime Movies, you still pay for SEC Network.

That is the reason that the most recent conference re-alignments stressed TV market as the reason to add a team. If a conference added a tv market like Atlanta, that is an extra $2 million per month for the conference, just from TV subscribers. That business model is changing as more people cut the cord, which they are doing in a large part due to the cost of ESPN.
Just to clarify, you don't pay for the SEC network or regional sports packages unless you subscribe to that level of service. If you get basic cable you only get ESPN and pay a lot less.

But to add, there is a lot of revenue for the networks and providers on the commercial side. Business packages are built out on size of premise and if you own a bar or restaurant you pretty much have to pony up and it is a lot.
 

Augusta_Jacket

Moderator
Staff member
Messages
7,875
Location
Augusta, Georgia
I dunno. With playoff expansion, I think they're settling back a bit now. The pressure's off. They're in a sweet spot and they're going to stay there.

Proposed playoff changes favor conference champions now. ND can be 12-0 and will automatically be seeded below the fourth highest conference champion at best, even if said conference champion was 10-2 or 9-3 (regular season). The powers that be wrote this into the proposal to push ND into a conference. If they stay independent, it's gonna end up costing them over time.


"The proposed College Football Playoff bracket would feature 12 teams: the six highest-ranked conference champions, plus six at-large teams. The four highest-ranked conference champions would earn first-round byes, and the next four highest-ranked teams would host the teams ranked nos. 9-12 in first-round playoff games."
 

mts315

Ramblin' Wreck
Messages
919
I dunno. With playoff expansion, I think they're settling back a bit now. The pressure's off. They're in a sweet spot and they're going to stay there.
There will be no benefit in scheduling ND once there are 4 16 team conferences. What powerhouse team would schedule ND when they are playing a 9 or 10 game conference schedule. ND would be playing a schedule of non-power 4 teams basically. They would end up in conversation like happen with UCF and Boise State currently. The fact is without the ACC guaranteeing them 5 games a year they wouldn't be able to put together a decent schedule now.
 

bobongo

Helluva Engineer
Messages
7,042
You are missing the current business model. ESPN (including SEC Network and ACC Network) gets their money mainly from TV subscribers. Viewership rating mean extremely little. Every single person with a broadcast TV cable/sat/streaming package pays for ESPN, and the great majority pay for SEC and ACC (except Comcast for ACC). It doesn't matter if you ever watch a game on SEC Network, you pay for the SEC Network. It doesn't even matter if you never watch any sport whatsoever and only watch Lifetime Movies, you still pay for SEC Network.

That is the reason that the most recent conference re-alignments stressed TV market as the reason to add a team. If a conference added a tv market like Atlanta, that is an extra $2 million per month for the conference, just from TV subscribers. That business model is changing as more people cut the cord, which they are doing in a large part due to the cost of ESPN.
If viewership ratings decline, the next contract won't be so big. The way you make it sound, nothing matters. You could pit Southeast Tippytoe Louisiana against Central Arkansas State A&M (or just do a Gilligan's Island re-run) and get the same thing, since "viewership ratings mean extremely little".
 
Messages
2,034
Proposed playoff changes favor conference champions now. ND can be 12-0 and will automatically be seeded below the fourth highest conference champion at best, even if said conference champion was 10-2 or 9-3 (regular season). The powers that be wrote this into the proposal to push ND into a conference. If they stay independent, it's gonna end up costing them over time.


"The proposed College Football Playoff bracket would feature 12 teams: the six highest-ranked conference champions, plus six at-large teams. The four highest-ranked conference champions would earn first-round byes, and the next four highest-ranked teams would host the teams ranked nos. 9-12 in first-round playoff games."
The 12 team scenario is a ways away. Listening to the PAC12 Commish yesterday, he said, their was only one conference in the room during the discussions...that being the SEC. Non of the other conferences have had input. I guess the SEC is now driving everything.
Wouldn't it be nice to have Clemson beat UGA, Miami to upset Alabama and Ohio State to win the title this year.
 

bobongo

Helluva Engineer
Messages
7,042
Just to clarify, you don't pay for the SEC network or regional sports packages unless you subscribe to that level of service. If you get basic cable you only get ESPN and pay a lot less.

But to add, there is a lot of revenue for the networks and providers on the commercial side. Business packages are built out on size of premise and if you own a bar or restaurant you pretty much have to pony up and it is a lot.
Yeah, and people pay for those packages including the SEC network because of the intriguing matchups they get - in the SEC.
 

bobongo

Helluva Engineer
Messages
7,042
There will be no benefit in scheduling ND once there are 4 16 team conferences. What powerhouse team would schedule ND when they are playing a 9 or 10 game conference schedule. ND would be playing a schedule of non-power 4 teams basically. They would end up in conversation like happen with UCF and Boise State currently. The fact is without the ACC guaranteeing them 5 games a year they wouldn't be able to put together a decent schedule now.
Well right now they have the ACC wrapped around their little fingers with our 5-game guarantee and don't have to make that choice. They could string us along for the next 15 years and be just fine, since we've put all our marbles on getting them full time. Are we going to dump them?
 

RonJohn

Helluva Engineer
Messages
4,489
If viewership ratings decline, the next contract won't be so big. The way you make it sound, nothing matters. You could pit Southeast Tippytoe Louisiana against Central Arkansas State A&M (or just do a Gilligan's Island re-run) and get the same thing, since "viewership ratings mean extremely little".
The big things that ESPN has depended on as they rose to behemoth power are: No two providers contracts with ESPN ended at the same time, and at least some people were interested in sports. That power is coming to an end because so many people are cutting the cord, and the TV providers are starting to thumb their nose at ESPN. ESPN put on a campaign to get people to abandon Comcast since the ACCN wasn't available on Comcast. I don't think that campaign had much effect.

The typical end of a contract would happen like this: The contract ends the week before college football starts. Both sides negotiate shrewdly. ESPN started advertising that college football might not be available on Dish/DirecTV/Comcast/Charter/etc (whichever one had the contract ending) and that fans might want to switch to another provider. The provider finally agreed to whatever outrageous price ESPN wanted in order to not lose 30-40% of their subscribers. Grandmothers who only watch the Hallmark Channel ended up paying $8-$10 for the main ESPN channel alone.

I have seen estimates from 5-6 years ago that the entire ESPN suite of channels cost the providers about $16 per subscriber. ESPN has been making most of their money from subscriber fees. The majority of those subscriber fees are from people who never, ever watch ESPN. Those people don't know that they are paying $16 for ESPN, they only know that their cable bill is too high.

That business model is changing, but for the last 20-30 years, yes it is true that nothing mattered to ESPN except ensuring that every TV subscriber is required to have ESPN and continually raising the rates they charge.
 

bobongo

Helluva Engineer
Messages
7,042
Proposed playoff changes favor conference champions now. ND can be 12-0 and will automatically be seeded below the fourth highest conference champion at best, even if said conference champion was 10-2 or 9-3 (regular season). The powers that be wrote this into the proposal to push ND into a conference. If they stay independent, it's gonna end up costing them over time.


"The proposed College Football Playoff bracket would feature 12 teams: the six highest-ranked conference champions, plus six at-large teams. The four highest-ranked conference champions would earn first-round byes, and the next four highest-ranked teams would host the teams ranked nos. 9-12 in first-round playoff games."
So if they make the playoffs, that just gives them a guaranteed extra game.
 

bobongo

Helluva Engineer
Messages
7,042
The big things that ESPN has depended on as they rose to behemoth power are: No two providers contracts with ESPN ended at the same time, and at least some people were interested in sports. That power is coming to an end because so many people are cutting the cord, and the TV providers are starting to thumb their nose at ESPN. ESPN put on a campaign to get people to abandon Comcast since the ACCN wasn't available on Comcast. I don't think that campaign had much effect.

The typical end of a contract would happen like this: The contract ends the week before college football starts. Both sides negotiate shrewdly. ESPN started advertising that college football might not be available on Dish/DirecTV/Comcast/Charter/etc (whichever one had the contract ending) and that fans might want to switch to another provider. The provider finally agreed to whatever outrageous price ESPN wanted in order to not lose 30-40% of their subscribers. Grandmothers who only watch the Hallmark Channel ended up paying $8-$10 for the main ESPN channel alone.

I have seen estimates from 5-6 years ago that the entire ESPN suite of channels cost the providers about $16 per subscriber. ESPN has been making most of their money from subscriber fees. The majority of those subscriber fees are from people who never, ever watch ESPN. Those people don't know that they are paying $16 for ESPN, they only know that their cable bill is too high.

That business model is changing, but for the last 20-30 years, yes it is true that nothing mattered to ESPN except ensuring that every TV subscriber is required to have ESPN and continually raising the rates they charge.
Uh huh. I'm pretty sure if viewership declines, the contract shrinks as well.
 

RonJohn

Helluva Engineer
Messages
4,489
Yeah, and people pay for those packages including the SEC network because of the intriguing matchups they get - in the SEC.
@Coloradojacket is correct that the bottom package does not include SEC network, but it is only the very bottom package on sat TV, and only the locals only on cable TV. (On Dish Top 120 doesn't have it, but Top 120 plus does) You don't subscribe to the SEC network, you just don't get the very bottom package.
 

orientalnc

Helluva Engineer
Retired Staff
Messages
9,334
Location
Oriental, NC
Re: the potential for merging with the SEC, remember this. In the Athlon preseason 130 (I am not a huge fan of Athlon, but they know more than I do),There are three ACC teams in the top 40 and nine SEC teams. While Clemson matches up nicely with Bama, it's the middle of the ACC that lags behind the SEC.

That said, the ACC/SEC would be a powerhouse conference and ND would be foolish to decline.
 

bobongo

Helluva Engineer
Messages
7,042
@Coloradojacket is correct that the bottom package does not include SEC network, but it is only the very bottom package on sat TV, and only the locals only on cable TV. (On Dish Top 120 doesn't have it, but Top 120 plus does) You don't subscribe to the SEC network, you just don't get the very bottom package.
The only reason I don't have the bottom package on Uverse is because it doesn't include the ACC Network. So I pay for it to see intriguing matchups in the ACC.
 

RonJohn

Helluva Engineer
Messages
4,489
In the short term.
I do agree with that, but it took 30 years for the short term to start going away, and 10 years after that they are still grossing about $8 billion from subscriber fees alone for the main ESPN channel. When the "short term" lasts 40-50 years, the only time someone is going to look at changing it is on the down slope. (which is happening now)

As to 2021, Kagan estimates that ESPN will generate just under $7.90 billion in affiliate revenue on an average per-monthly fee of $8.97 across 73.4 million subscribers.

The network will garner an estimated $2.08 billion in net advertising revenue in 2020 and $2.35 billion in 2021, according to Kagan.

That same article estimates that SECN had 55 million subscribers last year and pulled in $560 million, and will have 50 million subscribers this year and pull in $530 million.
 

bobongo

Helluva Engineer
Messages
7,042
Re: the potential for merging with the SEC, remember this. In the Athlon preseason 130 (I am not a huge fan of Athlon, but they know more than I do),There are three ACC teams in the top 40 and nine SEC teams. While Clemson matches up nicely with Bama, it's the middle of the ACC that lags behind the SEC.

That said, the ACC/SEC would be a powerhouse conference and ND would be foolish to decline.
If the SEC merged with the ACC, wouldn't that dilute their payout per team? If so, why would they want to do it?
 
Top