Blog Entry

Pac-12 may be looking at another $1 billion

Posted on: May 25, 2011 6:37 pm
Edited on: May 25, 2011 6:38 pm
 

WALNUT CREEK, Calif. -- The Pac-12's financial momentum isn't about to slow.

 Commissioner Larry Scott said Tuesday that the league's media arm could earn the conference an additional $1 billion over a seven-to-10 period. The previously announced Pac-12 Media Enterprises is a kind of holding company, according to Scott, that would bundle the league's new network, the digital rights and the conference's sponsorship and licensing (Pac-12 Properties).

 The expanded conference is just beginning to realize its total worth as it seeks to start its own network. The $1 billion would be separate from the 12-year, $3 billion rights fees deal the Pac -12 finalized with ESPN and Fox earlier this month. 

 "I can tell you this, based on offers people have made to us we've got at least a billion-dollar business we're sitting on," Scott told CBSSports.com. "That's just Pac-12 Media Enterprises."

 He later added:  "That is a broad figure that has been thrown out to us by media investors. That's a potential minimum value over a seven-to-10 year period."

 Dividing $1 billion among 12 schools could mean an additional $83 million is gross revenue total per school. Depending the on length of the deal, that means Pac-12 Media Enterprises alone could produce an additional $8.3 million-$11.9 million per year for each school. The schools already are guaranteed an average of $21 million per school in the ESPN-Fox deal.

 Stanford AD Bob Bowlsby seemed to confirm another pending windfall for the conference telling CBSSports.com that the network and digital rights "may be worth well into eight figures per year." He added, "Time will tell on that. We may know something in the next 90 days."

 Scott called Pac-12 Media Enterprises a "for-profit subsidiary of the conference."

 "I'm not running from it," he added, "but I don't want to leave the impression that our primary focus is financial."

 Scott, as well as industry insiders, is anxious to see the possibilities of the conference's network. The commissioner consulted with -- and gives a lot of credit to -- his peers at the Big Ten and SEC (Jim Delany and Mike Slive) who previously started similar ventures. All parties know the road to network profitability can be a long, hard slog. It took the Big Ten more than two years to realize a profit with its network. That was relatively fast for a start-up but no one knew in the beginning when that profit would come.

 The Pac-12 is seemingly better positioned because Scott negotiated rights to first-tier games in football and basketball for his network. In other words, the Pac-12 Network (or whatever it is called) will have first choice of the best games for its air.

 That situation will help with potential partners, distributors and advertisers. Scott said the league is still deciding how to deploy the network. First reports were that the Pac-12 would own it alone. That approach would maximize profits instead of having to share them with a partner. But Scott said several business models are still on the table.

 Scott even foresees a situation where the Pac-12 Network could be shown on an existing channel. He used the example of the Oprah Winfrey Network (OWN) replacing what used to be Discovery Health.

The digital possibilities, he continues to say, are limitless. There are 2,700 Pac-12 "events" available for broadcast each year according to Pac-12 TV consultant Chris Bevilacqua. To date, only 131 of those have been sold. Scott wants Pac-12 content on every device imaginable. There already have been discussions with Google as a possible partner.

 "It's hard to imagine now but I wouldn't be surprised that five-to-seven years from now we've got more fans on different devices other than TVs," Scott said.

 

 

Comments

Since: Nov 25, 2006
Posted on: May 25, 2011 8:11 pm
 

Pac-12 may be looking at another $1 billion

The SEC can claim the most wash-up NFL coaches in it's league and the highest payroll (I mean tuition assistance to it's player). Heck the even have one former NFL coach that couldn't stand the heat even for one year.




Since: Aug 22, 2006
Posted on: May 25, 2011 7:57 pm
 

Pac-12 may be looking at another $1 billion

 they cannot be the super conference until they win something
oh boy, here comes the 'confernce fans' again.  Stick to rooting for your team instead of claiming 12 schools as your own. 



Since: Apr 20, 2011
Posted on: May 25, 2011 7:46 pm
 

Pac-12 may be looking at another $1 billion

...and yet college tuition continues to increase. 



Since: Sep 18, 2007
Posted on: May 25, 2011 7:29 pm
 

Pac-12 may be looking at another $1 billion

Really, no one watched the Pac 10 before and no one will watch the Pac 12 now.  The SEC already had Billion Dollar contracts with ESPN & CBS and that doesn't even figure into account the separate deals that they can make outside of the games not shown (Ex: Tiger Vision f/LSU, Jefferson Pilot, etc).  

Not to mention since the formation of the BCS where CFB's #1 plays #2, the Pac 10/12 hasn't won a single NCG (U$C's 2004 was just denied).  They should have played AU anyway in 2004.  The SEC had beaten OU in the 2003 NCG.  That makes 7 of 13 in case you haven't been counting.  The SEC dominates the Final Top 25 rankings and the Bowls each year and that's with our Conference playing in the NCG every year which means the other Bowl match-up must normally play higher ranked teams.  You guys, on the other hand are 9-6 in BCS Bowls... U$C is 5-1, but 3 of their wins have come against the Big 10 Runner-Up because the Rose Bowl will only normally allow a Big 10 vs Pac 10 match-up.  

Take a look a who wins the Recruiting Rankings every year, who has the most players on opening day NFL Rosters (not how many losers U$C has drafted) and which Coaches has the most BCS NC's.  It's the SEC... 5 in a row and counting.



Since: Aug 18, 2010
Posted on: May 25, 2011 7:29 pm
 

Pac-12 may be looking at another $1 billion

I really enjoy Pac 10/12 football, but they cannot be the super conference until they win something.  USC's probation will not help, but at least other schools have started to step up and make the conference more balanced.  This means little to me as I always watch a couple of Pac 10 games each weekend, but it will mean a great deal to the fan that cannot find Pac 10/12 football on their system. 



Since: Feb 14, 2007
Posted on: May 25, 2011 7:16 pm
 

Pac-12 may be looking at another $1 billion

this is officially now the  SUPER CONFERENCE  of college football


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