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Afteroon A&M, SEC Expansion Update

As I prepare to join CSS’ “SportsNite” crew from MrSEC Headquarters, I thought it would be wise to bring you a few more expansion-related notes.

Here goes…

1.  There’s still no word on a Texas A&M withdrawal from the Big 12, but that league says it’s ready if such a pull-out comes.

2.  Dan Wetzel of Yahoo! Sports believes TCU should be a target of the SEC.

3.  Darren Rovell of CNBC says the addition of A&M wouldn’t mean much to the SEC in terms of TV money after all.  In fact, Rovell quotes former CBS Sports president Neal Pilson as saying that the addition of the Aggies would have “minimal impact” on the league’s television contracts.  Pilson also says:


“Adding one or two teams does not cause the entire agreement to be renegotiated. … Based on their record over a period of time, it doesn’t appear like Texas A&M is going to be in the top tier of teams in the SEC.  So if there’s any adjustment to the TV deals, I would anticipate that it would be a very modest adjustment, if anything.”


According to Rovell, if A&M is added to the league, the SEC’s television contracts would have to be bumped up by 8.3 percent in order for the current 12 schools to break even in the deal.

So where is the incentive for this move?

If the widely held belief that A&M would help the league make more money via TV isn’t true, then why bring them into the league?

Does the SEC have a contract clause that would allow it to use the extra inventory created by the addition of one or two teams on a start-up network of its own, a la the Big Ten and Pac-12 networks?  We believe that option came off the table when the SEC signed its deal with ESPN three years ago.

So either a) Mike Slive and the SEC have some money-making scheme up their sleeve or b) the league’s presidents are going to take less money and add more competition for their sports teams just for kicks.  Sorry, but Option B doesn’t sound like a realistic choice.

We continue to say that the A&M-to-the-SEC deal isn’t done yet.  We’ve been told that by our sources.  We believe that.  And the more we hear from television execs, the more we believe that.

Likely, yes?  Done deal?  Not yet.

 


22 comments
@Kelticgator
@Kelticgator

People need to realize that this is a strategic move for both TA&M and the SEC. For the Aggies the long term benefits greatly outweigh and short term setbacks.

For the SEC they are also positioning themselves for the future. The Big 10 has fired the first shot and that is the competition. Delany is attempting to regain prominence through expansion because he knows he cannot do it otherwise. Should the SEC be left out of the expansion feast by the Big 10 and Pac 12 it could bring a shift to the college football landscape. Slive is afraid of being "regionalized", especially as the Big 10 correctly identified expanding into new regions rather than existing areas as key to their agenda. The ACC basically shares the same footprint as the SEC so there is limited value there. The Big 12 is the real prize here and it's proven to be vulnerable to raids.

In the short term the SEC doesn't need to prove that the league has "increased value". All they really need to do is renegotiate at existing "fair market" value. They inflated contracts signed by the Big 12 and Pac 12 now make the SEC vastly undercompensated. The SEC set the bar but then competition gave the ACC, Big 12, etc, roughly equivalent contracts despite inferior programs and much lesser ratings. If the SEC can now get their value from CBS and ESPN, it will be a win. Or CBS could go hardline and risk losing their cash cow. When you look at other programming, networks have proven again and again that they will overpay for a product rather than risk losing it altogether. The networks know who is king of college football and they will strive to keep the king satisfied and happy.

theNetSmith
theNetSmith

Those of you who discount the impact of the D/FW and Houston TV markets on SEC football with the addition of A&M have your head in the sand.

ShannyDeridan
ShannyDeridan

LOL

A&M wont be on the televised SEC marquee games... so are people in Texas now going to be interested in LSU vs Miss St?

A&M will be lucky to get on CBS once a year- nobody cares about A&M

Hoginknoxville
Hoginknoxville

Hey John,__What does UT think about Texass A&M joining the SEC? I would imagine that Vol AD Cronnan has an opinion on the defending national champion Lady Aggies coming into the Lady Vols conference. Quite a few people in Arkansas believe that Pat Summitt had a hand in Gary Blair's firing at Arkansas since a Pat Summit alum took his place and UT secured Strickland in the process. I'm sure Blair is licking his chops to play the Lady Razorbacks.

@baopham
@baopham

The TV exec is right, between ESPN and CBS - the SEC is already in the Texas TV Market, in addition there's a large number of LSU and Arkansas alumni living and working in Texas. Don't forget that if A&M joins the SEC it's not 8.3% additional revenue that needs to be generated, its more bc when you take A&M, you will eventually have to take team #14 as well. So the league really needs to generate 16.6% additional revenue to maintain the status quo. That's a more difficult proposition - if the SEC uses the extra games inventory to launch their own cable network it would seem possible. I have a feeling that team 14 is still pretty hard to find at the moment, the candidates all have major flaws. FSU doesn't want to join, VaTech can't leave UVA for political reasons, GaTech/Clemson don't bring much and are in SEC states, if you take Mizzou, you are taking a team the B1G passed on and you are destroying the Big12. WVU might be a decent choice, but they're a Big East team, might not be able to deliver the Pittsburgh/Virginia/Washington DC markets and seem tied to Pitt.

ShannyDeridan
ShannyDeridan

The CNBC guy is right-

even if we do take on aTm, they are unlikely to ever be in the marquee games of the week on TV.

I hope they like 11:20 AM "SEC Network" Kickoffs

ShannyDeridan
ShannyDeridan

I really dont want A&M

the "TV Markets" argument always seemed to be a stretch to me... and the Longhorns will always be on peoples televisions no matter what conference the aggies are in

That money has to be lost by flying the girls volleyball team etc. from the East coast to "middle of nowhere" Texas and back twice a year

IMO the aggies have little to offer the rest of the SEC, and if its true the "TV Markets" argument they've been spewing is a bunch of bs... why dont we just tell them to check out the WAC

houstonvol
houstonvol

I still find it hard to believe that Slive would have allowed the talks to progress to this point if it was not going to be for the benefit of the conference. We don't know the wording of these contracts. Slive might be rolling the dice on the move in regards to renegotiation of the contracts. It might be that expansion allows renegotiation - however if the SEC is not satisfied with the new amounts then it will allow the SEC to announce the end of the contract and re-open the bidding to all parties. Kinda of how the Big East is right now. They were not satisfied with the offer that ESPN put on the table so they will be opening up their contracts to all bidders. The SEC might be positioning themselves for the same process. It would mean a short term loss, but allow them not to be committed to TV contracts for the next 15 years that will end up putting the conference behind in revenue.

Jim Meyers
Jim Meyers

The Big East is at the end of their current contract and working toward their next one. When they passed on the ESPN deal this was just the exclusive negotiating window that was in the former contract now they are free to talk to Comcast/NBC and Fox as well as ESPN.

The likely language in the SEC contract will allow the SEC to go back to CBS and ESPN with a good faith on both sides. If they offer say anywhere from 2 percent or more for TAM there is not a court in this country that will say this offer was not in good faith. The SEC will not be able to put the rights back on the open market for bids.

Bulldog
Bulldog

What would you expect a tv exec to say?

johnmrsec
johnmrsec

Bulldog...

That's an EX-television executive. I'd expect him to state what he believe to be true lest he appear to be an idiot if/when things play out differently.

John

dwp007
dwp007

Much ado, about nada. A&M needs the SEC much more than the SEC needs A&M.

ShannyDeridan
ShannyDeridan

If there is no money to be made with the so called Texas TV market...

why in gods name would the SEC want Texas A&M?

@KEGreene1
@KEGreene1

I said when the SEC signed that long term agreement that it was a mistake. All they had to do was go backward 15 years and see how fast things changed and things are changing even faster! I never thought of the TCU angle that Wetzel threw out there. IF the former exec is right, than wouldn't that significantly change things? 25 million Texas households should be a big enough sway to boost TV revenue more than 8.3%. I still say there are forces out there muddying the waters to stop this from happening. There are too many organizations (NCAA, CBS, ESPN/ABC, Fox, NBC) that will be hurt financially should this come to pass.

Jim Meyers
Jim Meyers

TCU is a non factor. Think of them like Vandy or Northwestern where no one really cares in Nashville or Chicago about the team. They have value to the Big East because the Big East lacks brand name schools and TCU and Bosie St are the only brand name schools out there that would actually join the conference.

@mdmost
@mdmost

How does the Florida thing work on Sun Sports?

@mdmost
@mdmost

Why doesn't the SEC start a network like the Big 10 or Pac 12? Seems there's money to be made there.

johnmrsec
johnmrsec

@mdmost...

As I stated in the above piece, the SEC supposedly agreed not to start its own network when it cut its deal with ESPN three years ago. Many of the non-revenue sports that other leagues use to fill time on their own networks are now airing on the ESPN family of networks. ESPN and CBS were going to be the SEC's network, in theory.

At the time, the Big Ten was having trouble getting its network cleared on cable outlets. Since then, they've turned the Big Ten Network into a what amounts to an ATM. The SEC looked smart in 2008 when it signed these contracts... now, that area looks to have been a mistake.

John

ShannyDeridan
ShannyDeridan

technically there is an SEC Network... its just run by ESPN

Alabama plays Kent St on the "SEC Network" this weekend

@ke4ole1
@ke4ole1

I still say the only way I will believe Texas A&M is joining the SEC is when I hear it from SEC Commissioner Mike Slive's mouth.

@KEGreene1
@KEGreene1

The question that needs to be asked here is... Are the TV exec's blowing smoke to keep this from happening? Isn't in their best interest to not have to re-open the contract. They do it for one, than other leagues start poaching and all the contracts are re-opened.

johnmrsec
johnmrsec

@KEGreene1...

Pilson is a FORMER exec. So there's really no reason for him to throw that out there... especially if he thinks/knows that he'll look incorrect in the days ahead.

John



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