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Expansion Talk 2021
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<blockquote data-quote="Augusta_Jacket" data-source="post: 817659" data-attributes="member: 1191"><p>For one, we can already see the plateauing in the way sports deals are done. With the current rate of cord cutting, networks have less money to spend on product. While there is still room to grow, exponential growth won't be around much longer.</p><p></p><p></p><p></p><p>No, but it would take a major miracle to get any of those schools. Since getting ANY school with any real ability to shift the TV needle is remote at best, the argument still stands.</p><p></p><p></p><p></p><p>Fanbase size alone doesn't matter. It's the economic impact of those fans. Take WVU for example. WV ranks 50th of all 50 states in income level and 40th in population. There aren't a lot of people in the state and they are the poorest state in the nation. Their fan base packs 50, 000 into a stadium, but outside of that 50-75k, the drop-off is steep. Factory schools with hundreds of thousands of rabid fans are what drive the TV needle. Those mergers, like adding UT and OU to the SEC make sense. </p><p></p><p></p><p></p><p>We have indeed entered the plateau point of college football as a business. You are likely to see a huge deal for the SEC because of the magnitude of their expansion, but that will come at a net loss of money paid to the Big XII. New money isn't moving into the enterprise, but rather current money is being reapportioned. There is the possibility that the new Playoff deal would raise the $ total, but only if inventory is raised. The current projection is 3x the money for the new deal, but there will be 3x the teams added to the playoff in that projection. You have to increase inventory to raise revenue at this point. The days of just throwing more money at the same product are drawing to a close. People will pay for value, but only if the price is competitive.</p></blockquote><p></p>
[QUOTE="Augusta_Jacket, post: 817659, member: 1191"] For one, we can already see the plateauing in the way sports deals are done. With the current rate of cord cutting, networks have less money to spend on product. While there is still room to grow, exponential growth won't be around much longer. No, but it would take a major miracle to get any of those schools. Since getting ANY school with any real ability to shift the TV needle is remote at best, the argument still stands. Fanbase size alone doesn't matter. It's the economic impact of those fans. Take WVU for example. WV ranks 50th of all 50 states in income level and 40th in population. There aren't a lot of people in the state and they are the poorest state in the nation. Their fan base packs 50, 000 into a stadium, but outside of that 50-75k, the drop-off is steep. Factory schools with hundreds of thousands of rabid fans are what drive the TV needle. Those mergers, like adding UT and OU to the SEC make sense. We have indeed entered the plateau point of college football as a business. You are likely to see a huge deal for the SEC because of the magnitude of their expansion, but that will come at a net loss of money paid to the Big XII. New money isn't moving into the enterprise, but rather current money is being reapportioned. There is the possibility that the new Playoff deal would raise the $ total, but only if inventory is raised. The current projection is 3x the money for the new deal, but there will be 3x the teams added to the playoff in that projection. You have to increase inventory to raise revenue at this point. The days of just throwing more money at the same product are drawing to a close. People will pay for value, but only if the price is competitive. [/QUOTE]
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