FanPost

Is the new ACC contract really good news for the SEC?



Is the new, lousy ACC contract as good news for the SEC as everyone seems to be saying? On most fronts it appears yes, as it both keeps it's Southern peers down the ladder financially, but also presumably opens the door to a Virginia Tech or NC State (or FSU or Clemson) move.

But does it possibly foreshadow negative consequences for the SEC's renegotiations?

Obviously, I don't have the ACC or SEC TV contracts to review, so we're doing this mostly blind. But I think there may be reason for the SEC to be concerned.

What we do know, is the new ACC contract is a total fail. Not only does the $17M contract fail to bring the ACC in line with the major conferences, it's also very backloaded. ACC schools will only see a $1M per year increase until 2021, when it will escalate the final few years to get to the much-quoted average of $17M. Considering that the 2010 ACC contract only ran until 2023 anyway, ACC schools won't see a substantial increase until about the time they would have been opening negotiations on a new contract again. Swofford basically negotiated the first few years of our NEXT contract to make it look like we actually got an increase for the Syracuse and Pitt additions.

What does that have to do with the SEC? Well, the ACC went into their expansion renegotiations undervalued (based on ratings and markets) and came out undervalued. Despite how many times people were told that the renegotiation was for the new teams only, people continued to cling to the idea that ESPN would reset the ACC for current market value. It clearly did not happen.

Well, if the ACC is undervalued at $13M, the SEC is incredibly undervalued at $17M per team per year. People (including me) have been throwing around numbers as high as $30M for the SEC if they are brought to market value, but what if ESPN plays the same sort of hardball with the SEC? It would appear that the most generous valuation for Texas A&M and Missouri wouldn't exceed $6M additional payout for SEC school. That would be $80+ Million per year for two teams that nobody is excited about and don't make top-tier matchups. If the SEC gets that, it would put them at $23M per year. Nice if you can get it, but it certainly doesn't separate them from the pack financially the way they've separated themselves on the field.

But then there's the SEC network, which everyone considers a fait accompli at this point. But is it? The current SEC contract is not believed to allow that to happen. So how does the SEC get that concession? My assumption has been that the reasoning would be somewhat like "Listen, instead of paying us the $30M per team we're worth, pay us $25M and give us the rights to some lower programming and let's start a network."

If ESPN only has to pay for TAMU and MU, and is going to play hardball on the market value, does the SEC really have any leverage to get a network started?

Obviously, this is all speculation. The SEC contract may be more different than the ACC contract than anyone knows, and may allow more opening for fair market value. Or, it could simply make a difference because it's the SEC. Just because the head cheerleader won't get in the back seat with the math club president, doesn't mean she won't with the star quarterback.

But if it's true, what does it mean?

First, it could mean that a post-expansion Big 12 might actually have a better deal than the SEC, simply because it is starting with a better, more current deal ($20M by reports). In addition, unconfirmed rumors (and let's face it, the rumor-mongers are winning on this story so far) are that the Big 12 has pre-negotiated their expansion escalators, and expansion with the right teams (plus a championship game) are rumored to put the Big 12 at $24-26M per team.

Second, how does this affect potential SEC expansion? The last SEC expansion was clearly about who would be valuable to an SEC Network (potential subscriber size) rather than who would be most valuable to ESPN ratings. If ESPN plays hardball, will the SEC need to look at who's most valuable to ESPN's programming, if it wants ESPN to pay up? Does NC State fit that bill?

Or more likely, does it take away most of the incentive for the SEC to expand again at all?

It will be interesting to see if ESPN takes the hard line with the SEC they took with the ACC. If they do, the SEC may not be sitting as pretty as they thought...

X
Log In Sign Up

forgot?
Log In Sign Up

Forgot password?

We'll email you a reset link.

If you signed up using a 3rd party account like Facebook or Twitter, please login with it instead.

Forgot password?

Try another email?

Almost done,

Join Tomahawk Nation

You must be a member of Tomahawk Nation to participate.

We have our own Community Guidelines at Tomahawk Nation. You should read them.

Join Tomahawk Nation

You must be a member of Tomahawk Nation to participate.

We have our own Community Guidelines at Tomahawk Nation. You should read them.

Spinner

Authenticating

Great!

Choose an available username to complete sign up.

In order to provide our users with a better overall experience, we ask for more information from Facebook when using it to login so that we can learn more about our audience and provide you with the best possible experience. We do not store specific user data and the sharing of it is not required to login with Facebook.

tracking_pixel_9341_tracker