The biggest news of the past couple of days is without a doubt the news that the Big East has entered into negotiations with ESPN to extend and expand the current TV contract. That is not all that surprising, it wasn't all that long ago that, roughly a month ago, that Bloomburg published market projections for a new Big East contract. The projections, based on the assumption that multiple media entities will enter the bidding.
This news has shed to light the long simmering differences between the Big East's Football and Basketball contingents.
ESPN’s offer has created a division among the conference’s schools. Some want to rebuff ESPN’s offer and take the conference’s media rights to the open market. The reason: The amount of potential bidders in the market has helped other leagues increase their media rights more than they initially expected.
Basically the Basketball only schools want to take whatever ESPN offers, for somewhat understandable reasons. The Football schools want to take the contract to the open market. The obvious goal would be to match the ACC's 155 million dollar annual contract. I think that the Big East can do it. It is a bull market for College sports with multiple media platforms expressing strong interest in entering the collegiate athletic fray. The ACC contract got to that 155 million number because Fox, and Turner made hard pushes to get those rights.
ESPN wants to completely lock up major college sports by acquiring the contracts to all the Big 6 or BCS conferences. I am fine with that, in fact I am devotedly pro on that issue. ESPN has problems, I don't agree with a lot of things they do in terms of completely dominating the dialogue on almost every single issue. But for broadening the impact and reach of institution like the University of Cincinnati being on multiple ESPN platforms is a good thing.
The big issue between the Basketball and the Football schools is pretty simple. Football is expensive, very expensive. Basketball is less so. The Football schools have an incentive, a pretty big incentive, to get as much money as possible from any new TV contract. While the Big East is miles beyond the TV deals of the other conferences, the gap between the conference and the rest of the moneyed BCS conferences is much larger. For Big East Football to compete in this brave new world of College Football they 9 schools need to a much larger piece of the pie.The current contract sucks, that is no surprise. But here is the details of just how much it sucks.
ESPN currently pays the Big East an average of $36 million annually as part of a six-year contract for all of its sports. While initial numbers being floated may not be as rich as the ESPN/ACC deal that was struck last spring, it would still mark a major boost for the 16-team conference.
36 million annually. That money is divided 24 ways (8 for Football schools plus 16 for the Basketball part of the equation) is 1.5 million per share, those shares are then allocated to the schools on the following basis. The Football schools get two shares, the Basketball schools get one. So for UC that is 3 million dollars a year.
Now the offer from ESPN is between 110 and 130 million dollars annually. If you take the low estimate of 110 million per year the math is 110 million divided by 26 (9 Football schools, 17 Basketball schools) UC's new share would be a touch under 8.5 million. If the deal struck is 130 million, it would mean 10 million dollars annually. That is good, but it would continue to make the Big East the poor sister in the world of College Football.
For the Basketball schools a new contract valued at the initial offer would double their cut with ease, and the majority of the Basketball only schools turn pretty sizable profits because they don't have to worry about the costs of running a BCS Football Program. UC has the lowest Football budget of anyone in the conference at a touch over 11 million, and barely turns a profit, and the athletic department as a whole is in the red. A new TV contract would go a long way to making the UC athletic department profitable, if not self sustaining. For the most part those are problems that the Basketball only schools don't have to deal with.
So the Football schools are pushing to put the contract on the market to get a better price. I think that the Big East can get a better price on the open market. While I would prefer to keep the ESPN relationship in tact, but if Al Jazeera pays UC 15 million dollars as a part of the TV contract I couldn't care less. But that is the big difference between the Football schools and the Basketball schools, and that explains the division that has plagued the conference since it started sponsoring Football. The conference office needs to start looking out for Football or it might be the end of the conference altogether.