How Valuable Was the Original Big 12, Where It Chose Wrong, & Other Questions

I wanted to address a few other questions that have come my way on television ratings and conference deals since the last time I put out an article like this. 

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How valuable would the original Big 12 have been if the original twelve teams had all stayed?

For this I am going to rely on contract amounts, two industry source estimates, and one personal estimate.

• Texas and Oklahoma were reported to be worth 50% of the recent ten-team Big 12 contract value with the remaining eight combining for the other 50%.
• When Nebraska and Colorado left they “should have been a loss of about 16 percent” of the Big 12 contract per a source who informed Chip Brown but because CU “had been an underperformer, the league only lost about 8.6 percent of its value with the loss of Nebraska”.
• Losing the combination of A&M and Missouri but replacing them with WVU and TCU results in some loss however, I never saw a decent estimate. A&M is a bigger brand than either in terms of television eyeballs but the Big 12 has added two that have performed well in ratings. So the hit would presumably be less than the initial two’s departure simply due to adding more value back in to the lump sum. My estimates will have a low of 4% and a high of 6% value lost.

My idea was to take the recent Big 12 contract total (380M) and assume a percentage of around 2/3 to 3/4 of that total is due to the remaining eight schools which make up 2/3 of the future members.   From there I apply the bullet points above.

This gets you somewhere between 48-60M per school. I also attempted to back into it simply by adding 5.1% increases each year (what the PAC-12 contract was built with) to what the 2019-2020 TV amount was in the 990 tax forms for the league. The result is more modest with a figure in the low 40M per school range.

The real answer would vary based on whether they had a network, whether rights went to the open market, whether they expanded, or other considerations. My personal guess is somewhere between 45M-55M depending on these factors.

If they were so valuable, why didn’t the Big 12 have enough money to stop teams from leaving in the late 2000s?

The Big 12 had two contracts that began in 2008. One with ABC for their top 19 games and one with FOX for their cable broadcasts after ABC picked. The top contract was extremely competitive with the SEC’s CBS deal signed a year later (that is in its final year now!) and with the concurrent Pac 10 deal at the time both in revenue per school and revenue per game. It’s the mismanagement of their tier 2 and tier 3 rights that did them in.

The Big Ten Network launched in 2006. The Big 12 was negotiating these deals in 2006 or 2007 after having shot down a Big 12 Network when Kevin Weiberg (who eventually started the BTN) tried to get them to do so. This was in retrospect a giant mistake that failed to monetize the bottom half of their inventory effectively as possible.

By the time 2009 rolled around the BTN was throwing off 6M per school to the Big Ten for the bottom half of their inventory while the Big 12 was getting peanuts for theirs. FOX’s entire contract paid an average of 19.5M per year to the whole Big 12 for basically anything after ABC’s first 19 games. The Big 12 was locked into a bad deal when the market for Tier 2 and Tier 3 television broadcast was reset.

When the Big 12 redid the FOX portion of their contract prior to 2012, the payout was 4.7 times the old FOX deal and did not include tier 3 rights which added a little more beyond that.

What kind of deal would prior contract inflation suggest for the PAC-12 both with their current ten or if the departing schools stayed?

If we assume Marchand and Ourand’s estimate of 40% value lost with the USC/UCLA departure and we take the contract and annual escalation percentage details from the Ed O’Bannon trial we can estimate a six-year deal following the conclusion of their current deal. It comes out to around 32M per school before you add in PAC-12 network revenue which historically has averaged around 2.5M per school. Add in an estimated 3M per school and it’s just under 35M with USC/UCLA. 

Without them, the projection is around 23M on a hypothetical FOX/ESPN extension with 26M if P12 Network is added in and still able to throw off 3M each with the loss of LA which I am not entirely confident on.

What moves could maximize exposure for the PAC-12?

After I commented on one of Dennis Dodd’s quotes from a recent article I was asked this question by a Utah fan.

Any realistic answer depends on:

• It needs to pay enough to make anyone who’d potentially leave see minimal or no benefit from doing so.
• It also needs to be able to do so for a duration in years that all schools would sign on for.

So all of this must be tempered by that. A streaming partner will probably have the deepest pockets right now but that won’t maximize exposure outside of getting the most attractive sublicensee they can for however much inventory they can be persuaded to sell. Therefore my answer is going to be linear-focused.

My advice would be two-fold:

1. Get the best primary partner exposure you can- which is ESPN, FOX, CBS, NBC
2. Find a way to get more exposure for the inventory sitting on the PAC-12 network

The two biggest linear players in College Football are ABC/ESPN and FOX. Getting them to extend the level of exposure and beneficial windows that the PAC-12 had under the prior deal is going to be the best outcome. They each have a network station with a long history of college football viewership that features one of the Big 2 leagues going forward. Additionally, ESPN, ESPN2, and FS1 reach over 90% of cable/multichannel homes. If a financially viable deal to extend the exposure level they had in 2022 was remotely viable now and financially “good enough” to avoid departures that would be step one. Assuming they’d still do a deal that would be good enough to avoid defections financially that’s my starting point.

I question CBS and NBC’s need for the PAC given time zones and current contracts- the Big Ten in particular. As I got into in a prior article, they don’t have a ton of room in the Windows that the PAC can help in. The PAC-12 can’t help at noon eastern with 8 of the ten schools either in the pacific time zone or in Arizona which might as well be due to daylight savings rules there.

CBS has the Big Ten in the afternoons exclusively. Additionally, they get around 2M viewers replaying a scripted show in Prime Time on Saturday. Given that the P12 averaged only 2.7M viewers on FOX Saturday Prime Time games the last two years that could be a tough sell to pay a ton of money vs a low cost and consistent return they already get. They did better on ABC (around 4M) but is CBS going to place an expensive bet on that when a reliable minimal-cost option is performing well?

On their cable network, they have plenty of content and are likely to continue to get a decent chunk of the MWC deal when it’s up in 2 years having partnered with both ESPN and FOX in the last two deals. That should support them in the “After Dark” window and we see that CUSA, UConn, and the service academies have them cheaply stocked during the daytime.

NBC is pretty booked with the Big Ten in prime time and Notre Dame tag teaming with NASCAR, Golf, and Horse Racing in the afternoon. They could put games on USA but I have questions on how much they desire to given they shuttered their own sports network. Also any thought of late games on big NBC is a non-starter with SNL sitting there.

The CW presumably has reach but I don’t think the pockets are deep enough to get them viable as a primary partner but they could be a decent supporting partner.

TBS/TNT would be great reach similar to ESPN/FS1/ESPN2 but since it’s been over a decade since they sublicensed the Big 12 or PAC-12 I question their interest and their willingness to spend since the NBA is up soon.

I do think the next rung down on cable would have potential sublicense options. NFL Network has done a fair bit at the G5 level, would have plenty of room to supplement a primary partner, and would offer reach on par with CBS College Sports, the SEC Network, or BTN.

Depending on how well they can manage obligations and costs with the PAC-12 network they need to find some way to get more eyeballs on P12 Network Inventory. I don’t think the payout will rise much losing LA as I don’t think the DFW and San Diego markets that balked at adding the MTN with TCU and SDSU will all of a sudden pay up for SMU and SDSU at a rate that would make up for the loss of USC/UCLA’s contributions in the LA market at what I assume would be a higher per subscriber price.

Depending on how well they could move on from the network, would they make more or come close enough selling directly to a TV partner for that inventory? If CBS Sports Network or NFL Network are willing to buy G5 games, I assume they’d at least talk about the bottom half of the PAC at least in part. Splitting a deal where they sell the next 25% after the primary contracts to a lesser linear player and the bottom 25% to ESPN+ might maximize things but it obviously depends on the financial constraints both in obligations with the PAC-12 Network and with what a potential buyer is willing to pay.

The ACC games that were broadcast on Bally Sports are now going to be sold elsewhere. If ESPN gets those back would that change your estimates for league exposure as it relates to the Big 12 and ACC on ESPN/2/U?

I don’t see it being a huge change if it is one at all. It’s 17 football games and a smattering of hoops games for the most part- which is roughly what the SEC and Big 12 have on ESPN+. ESPN’s self-interest would be better served by making 14 new fanbases subscribe to ESPN+.

The ACC Network and ESPN+ would drive more revenue than swapping out a low-tier Big 12 game for a low-tier ACC game and getting less advertising or subscription upside. The Big 12 already has around 2 games per school on ESPN+ and a handful more won’t change the numbers much. Putting Duke, UNC, Louisville, Syracuse, and UVA hoops on ESPN+ alongside Clemson and FSU football’s weaker games would add dollars for ESPN+.

After OUT, which Big 12 schools have the strongest tv ratings, all other things being equal?

In my analysis of Big 12 teams and PAC-12 teams last year I did an analysis on how well the top number of games per school averaged for each team in their conference games not including Texas or OU alongside the PAC-12 without USC and UCLA. Here’s the chart I published.

Oklahoma State was the strongest Big 12 performer with BU and TCU right behind them and WVU as the next man up. However, each of these schools will vary a bit depending on result as it tends to influence significant casual viewership as well as how consistently they get favorable tv windows.

Who rakes in the highest ratings compared to their alumni base size?

In my opinion that has to be either Notre Dame or Miami. In my national tv rating article from last year ND was 7th in their top 4 games per year average and Miami was 23rd. Baylor and TCU did well at 28th and 31st.

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