Conference TV Contracts and Revenue

[cu blujs]

Hear, hear!

[GoldenWarrior11]

Couple of counter-points, Bill.

A lot of nay-sayers like to point to the ratings as to why the Big East is either struggling or needing to increase the value of the conference. Our agreement with Fox is really unlike any other major sports TV deal in history. We are a non-football college conference, on a brand new network, that is increasing viewership across all programming each and every year. Fox bet on us, and we bet on Fox. If our games were on ESPN, our ratings would be exponentially higher. On the flip-side of that coin, we also bet on ourselves by leaving ESPN. The results and the success have certainly come with that gamble as well. Our ratings will continue to climb each year on Fox, due to the increased awareness and viewership of the network. Frankly, if the ratings were decreasing, and we weren't getting high attendance figures at each of our respective arenas, then there would be reason to worry. However, that is not the case.

You referenced Seton Hall and UConn as examples of weak programs that were added by Gavitt in the original Big East. However, creating a conference of unlike-minded institutions and athletic goals was what led the original incarnation of this conference to destruction. VCU may never add football, but they are not the same type of school that all ten of our current members are. Again, and apologies for the repetition, that absolutely doesn't mean VCU isn't a strong basketball program, it just means they are not a fit for the current Big East.

Going off of that point, Saint Louis and Dayton are both institutional, geographical, academic and athletic fits. I have repeatedly said that, if the Big East currently has an expansion list, they are most likely #11 and #12, respectively (I would also guess that Richmond and Davidson are probably #13 and #14). They do have large arenas in markets that clearly support college basketball. However, we are not even half way through our first contract with Fox. Expanding now would not help increase our value when its time to renegotiate in a few years.

[stever20]

The thing is, when we get close to negotiation time, if the ratings haven't improved enough, Fox won't pay the money to a- keep it the same- and b- not take the best programs. They're going to want the best programs period. And if VCU has kept up what they've done, in 6 years they would have had a 13 year run. Esp if they got back to the sweet 16 or elite 8.

Ratings may have gone up, but they still for conference games do not even average 160k viewers per game on FS1, even with a plum schedule.

[NovaYanks10]

I'm a Villanova fan and am sick of hearing about Dayton.

They are not our peer in any way (basketball success, academics). I don't want to be associated with them or hear about them on this board.

[stever20]

I'm a Villanova fan and am sick of hearing about Dayton.

They are not our peer in any way (basketball success, academics). I don't want to be associated with them or hear about them on this board.

Did you consider Butler, Xavier, or Creighton to be your peers in any ways?

[Fieldhouse Flyer]

Excellent posts by Bill Marsh and GoldenWarrior11.

If the brand identity is a major asset, why aren't the ratings higher?

Good question. Let’s look at some numbers.

Average Big East Viewership on FOX/FS1 by Season

2016-17: 192k
2015-16: 166k
2014-15: 143k
2013-14: 104k

Percentage increase from 2013-14 season to 2014-15 season = (143–104)/104 = 37.5 %

Percentage increase from 2014-15 season to 2015-16 season = (166–143)/143 = 16.1 %

Percentage increase from 2015-16 season to 2016-17 season = (192-166)/166 = 15.7 %

These numbers will not be giving comfort to Fox Sports executives.

In the 2016-17 season, the Big East had seven NCAA Tournament-bound teams, led by defending National Champion Villanova, who was ranked No. 1 in the AP Poll for most of the season, and finished at No. 1 in the Final AP Poll. The Big East finished third in Conference RPI Rankings:

This season, the Top 6 conferences had Final RPI Ratings of .550 or better, the next 6 conferences had Final RPI Ratings of .500 or better, and the remaining 20 conferences had Final RPI Ratings worse than .500.

RPI Rank, Conference, RPI Rating

1 Atlantic Coast Conference .5802
2 Big 12 .5779
3 Big East .5676
4 Big Ten .5653
5 Southeastern .5580
6 Pac 12 .5501

7 American Athletic Conference .5242
8 Atlantic 10 .5227
9 West Coast .5218
10 Mountain West .5208
11 Colonial .5040
12 Missouri Valley Conference .5007

The 2016-17 season was the best opportunity to date for a TV ratings jump since the 10-school Big East was formed, but instead, the 2016-17 season had the slowest rate of growth in TV viewership in the past three seasons.

In 2017-18, the Big East will average more than 200,000 viewers per game, but how many more above 200,000 is anyone’s guess.

The key questions whose answers are not available are:

1. What were Fox Sports’ expectations for viewership in the inaugural 2013-14 season?

2. What were Fox Sports’ expectations for the average annual increase in TV viewership?

The answers to these two questions will be fundamental when the Fox Sports TV Rights Contract expires eight years from now.
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In the longer term, the Big East will find it harder and harder to compete with the resources of the P5 conferences:

SEC Net Basketball Revenue = 20% of $32.7 million per year per school = $6.54 million per year per school.

Big Ten Net Basketball Revenue = 20% of $32.4 million per year per school = $6.48 million per year per school.

Pac-12 Net Basketball Revenue = 20% of $25.1 million per year per school = $5.02 million per year per school.

ACC Net Basketball Revenue = 20% of $26.2 million per year per school = $5.24 million per year per school.

Big 12 Net Basketball Revenue = 20% of $22.7 million per year per school = $4.54 million per year per school.

2015 Big East Payouts

Villanova $3,273,830
Xavier 3,220,709
Georgetown 3,217,909
Providence 2,977,189
Butler 2,950,070
St. John's 2,923,504
Marquette 2,703,538
DePaul 2,380,570
Seton Hall 2,377,653
Creighton 2,215,475

Total: $28,240,447
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The revenue gap between the P5 conferences and everyone else looks to grow in the future:

ESPN to launch ACC Network - Business Insider - July 21, 2016

ACC Commissioner John Swofford said Thursday the ACC Network will launch in August 2019 as part of an extended media deal with ESPN that now runs through the 2035-36 season.

The league will move to a 20-game league schedule in men's basketball by 2019, part of an effort to boost the available content toward the goal of airing more than 1,300 events annually through those outlets.

Swofford wouldn't comment afterward on the payouts to league schools with the creation of the ACC Network other than to say the rights fees "obviously go up" with the deal.

The ACC will become the fourth major conference with its own network, joining the Big Ten, Pac-12 and Southeastern Conference. The SEC also has ESPN as its partner and launched in August 2014.

The Big Ten’s new TV deal puts it into the lead, may provide a competitive edge - Andrew Bucholtz, AwfulAnnouncing – January 15, 2017

The cash spigot that is the Big Ten Network continues to pay huge dividends, especially since Rutgers and Maryland joined the league. In the fiscal year that ended in June 2015, according to USA Today, the Big Ten distributed $32.4 million to member schools that had full shares (Nebraska, Rutgers and Maryland did not). The money is about to go up, up, up.

The league’s new TV deal kicks in later this year, a reported $2.6 billion package over six years. The Cedar Rapids-Gazette reported that per-school payouts are conservatively estimated to top $43 million in 2017-18 and could top out at $54 million per school at the end of the contract.

That’s a lot of money.

ESPN is already overstretched financially, and has TV rights to more content than it can show. This likely means that ESPN will not be competing with Fox Sports for the Big East TV Rights Contract when it comes up for renewal in eight years’ time.

As many posters have previously written, maintaining the status quo may not be the best option for the Big East in the longer term.

[stever20]

the tv rating numbers using all the networks- such a joke....

you see there's this little thing out there....
2013-14 season- 1 game on Big Fox
2014-15 season- 9 games on Big Fox
2015-16 season- 12 games on Big Fox (including BET F)
2016-17 season- 12 games on Big Fox (including BET F)

so well duh, the ratings are going to be up considerably from 2013-14 season.

[gtmoBlue]

in regards to the 2015 BE payout numbers...

Those numbers listed are the numbers which FieldhouseFlyer deducted annual conference costs from to get down to that level. In another post we saw that annual NCAA Credits payouts were used and annual conference costs were also deducted from those numbers. I suppose it is in how one reports the numbers, what expenses are tallied to an individual set of numbers, and so forth. In both cases presented the effect was to lower the overall revenue numbers, thus skewing the tally.
A more appropriate method is to account for overall revenues from each income stream, then deduct conference costs (the $10 Mill-$15 Mill annually which was purported) from that overall figure. Less guesswork and more realistic numbers in that method.

It also seems as if the TV numbers are being touted as "sole source" BE income when they are one stream amongst 3-5 streams of income: TV revs., NCAA Credits revs., MSG Marketing Rights revs, Big East Overall Marketing income revs., BEDN revs., Major Sponsorships revs., and perhaps other streams we are not aware of.

Individual schools also have additional revenues - Marketing plans, F&B/Parking, Ticket sales, Uniform/shoe contracts, Donors, etc. which are not included in any of the numbers touted thus far. It is not doomsday, nor the 11th hour on the clock.

Agree that the football five are making grand theft monies, and that the gap will widen. The goal is not to "Keep Up", which is impossible sans football, but to keep the BE afloat financially and to be able to compete in hoops. $3-6 Mill in sports revenues from the 5-6 sources at the conference level (above) should help to maintain the schools competitiveness. With growing conference marketing, improving and expanding the BEDN, sustaining sports performance, and merchandising, the conference can maintain its' competitiveness financially.

[billyjack]

Groundhog Day repeated comments... 84% ratings increase in 3 years. Many games include non-conference vs dreg teams. FS1 is basically our own private network.

The conference has a game plan. Patience, steady growth. Trendlines in every area are positive.

A sucky, skittish organization with no confidence makes knee-jerk, wild, poor decisions, has loose cannons in charge, has constant in-fighting and deals on pettiness, and freaks out constantly depending on which way the wind blows hour to hour. Think about typical crackhead football conference.

A sensible, rational organization sticks to their plan, has bright people running the show, trusts in itself, makes common sense decisions, has members that support each other and try to build each other up for the common good, and doesn't freak out and flip around like fish thrown into a rowboat.

[stever20]

Groundhog Day repeated comments... 84% ratings increase in 3 years. Many games include non-conference vs dreg teams. FS1 is basically our own private network.

The conference has a game plan. Patience, steady growth. Trendlines in every area are positive.

Compare these 2 things:

A sucky, skittish organization with no confidence makes knee-jerk, wild, poor decisions, has loose cannons in charge, has constant in-fighting and deals on pettiness, and freaks out constantly depending on which way the wind blows hour to hour. Think about typical crackhead football conference.

A sensible, rational organization sticks to their plan, has bright people running the show, trusts in itself, makes common sense decisions, has members that support each other and try to build each other up for the common good, and doesn't freak out and flip around like fish thrown into a rowboat.

Most of the 84% increase is the fact that instead of 1 game on Big Fox, there was 12, including the BET final. And there were a whole hell of a lot more dreg games 4 years ago shown on FS1 and FS2 than there are now.