Word that Fox had agreed to pay $1.5 billion over six years to acquire HALF of the Big Ten's television rights sent shock waves throughout college football. To put it in perspective, Fox is paying as much for half of the Big Ten's rights as the combination of Fox and ESPN are paying for the entire Pac-12's rights package. It's a huge number, and depending on what the other half of the package brings in, could easily top the SEC's deal with CBS and ESPN - even with the value of the SEC Network factored in.
But a little bit of caution is in order. Don't assume that the other half of the contract will also be worth $250 million a season. In fact, I suspect the second half of the deal will bring in significantly less than the first half. Unless Fox can find a way to sell off part of their existing agreements with the Big XII and Pac-12, I don't believe that Fox has the ability to carry any more games. So they won't be in the bidding anymore.
Everybody knew that Fox wanted part of the Big Ten's package, and they haven't been shy about making big bids to acquire sports programming. What was surprising is that ESPN apparently low-balled the Big Ten, according to Sports Business Journal. Why did ESPN close their checkbook? For starters, this might be the first solid evidence that cord-cutting is popping the bubble on sports rights fees. Over the last year, ESPN has begun shedding many of their high priced talent: Colin Cowherd, Keith Olbermann and now Skip Bayless. Earlier this week, long-time ESPN play-by-play voice Mike Tirico, the voice of Monday Night Football, NBA and Big Ten basketball, the Masters and grand slam tennis, reportedly left ESPN to join NBC. And according to Clay Travis, Brad Nessler is leaving ESPN to become the heir apparent to "Uncle" Verne Lundquist.
With that in mind, it seems unreasonable to think that ESPN will agree to match Fox's $250 million deal for the other half of the contract. For starters, they don't have to; Fox isn't going to be pushing ESPN to bid up. But one thing appears to be clear: ESPN and the Big Ten still need each other, to some degree. Yes, the ESPN still has the SEC and the Big Ten now has Fox, but that's not good enough for both. ESPN wants the television sets in Chicago, Detroit, Cincinnati, Cleveland, Philadelphia - and yes - New York City and Washington, DC. The Big Ten does not want their games treated like the NHL's games on the Worldwide Leader in Sports - ignored at their own peril. Sports Business Journal reported that some school officials were "scared to death" that the Big Ten would not be able to reach a deal with ESPN, because of the effect on recruiting.
Those same officials were told that "anything is possible" with respect to what will happen to the rest of the rights package. Just who might be bidding on the rest of the package? I get a feeling that the remaining package could be split up even further between CBS, ESPN, NBC and Turner. Perhaps a two or three-way split, with ESPN and NBC or CBS taking one football game each, and a selection of basketball games for each network.
CBS and Turner Sports have already developed a relationship to air the NCAA Basketball tournament, and that relationship could be extended to include the Big Ten. Turner Sports would like to add some regular season basketball games, while CBS has timeslots both before (the dreaded 11 am kickoff) and after (primetime) their SEC afternoon game. CBS has been somewhat aggressive in extending their NCAA Basketball tournament agreement along with bringing the NFL's Thursday Night package to broadcast television.
Speaking of Thursday nights, Sports Business Journal mentions the possibility of Turner looking for a Thursday night package of Big Ten football games, which would seem to be a risky move at best for the Big Ten. For starters, Thursdays are now becoming just as busy as Saturdays, in terms of football games with NFL games as well as college games on ESPN and Fox. Moving Big Ten games away from Saturday would not only fly in the face of long-standing tradition, and presents significant logistical challenges. It's one thing for crowds of 90,000 to invade Lincoln on a Saturday, as no classes are in session. It's another thing to do that on a Thursday evening, with classes going on simultaneously. The problems will be even worse at Michigan, Ohio State and Penn State, with crowds over 100,000.
NBC has plenty of open timeslots to offer, outside their seven or eight Notre Dame games each fall, and just hired a new play-by-play voice in Tirico with a history of calling Big Ten games. He even lives in Ann Arbor, Michigan. NBC might be planning on making a bid to better utilize their investment in Tirico, who's known as a workhorse announcer, outside of football season. Sports Business Journal wonders if this conflicts with an NBC strategy against sharing deals with other networks, though that hasn't stopped NBC from sharing rights to the NFL and NASCAR.
One of the more underappreciated facets of the Big Ten's agreement with Fox is that it's a six year deal that expires in 2022-23. The Big Ten was last of the major sports properties to negotiate a new deal, and now, they'll also be one of the first to the table for the next deal. Why is that? It may be all that Fox was willing to commit to at these prices.
It also may be because the "grant of rights" arrangements in the Big XII and ACC will be nearing their end. As we all know, America's most dysfunctional sports conference is held together by a fear of being abandoned. The Longhorn Network makes Texas unappealing to every other conference, while nearly every other school (not named Oklahoma or Kansas) needs Texas to maintain their own relevance. So why do Oklahoma and Kansas stick around the Big XII? For now, it's the ambiguity of what might happen if they bolted. But if they bolt after 2023, Kansas and Oklahoma might owe two years worth of rights (at 2012 rates) to the Big XII in exchange for a share of the Big Ten's revenue, which looks like it'll be double what they get from the Big XII. In some respects, this might be setting the stage for another Maryland-like acquisition for the Big Ten, where the benefits of expansion clearly outweigh the costs that are incurred.
And if the Big Ten's lawyers can slice through the Big XII's "grant of rights" agreement as some think is possible? Well, that's even more money to be made. No, conference realignment isn't happening tomorrow or next year. But the Big Ten's television deal could simply be an interim deal to bridge the conference until it's time to reopen the entire matter.