May 28th, 2013 01:00 PM║ Posted By: John Pennington ║ Permalink
║ Schools: Alabama, Arkansas, Auburn, Florida, Georgia, Kentucky, LSU, Mississippi State, Missouri, Ole Miss, South Carolina, Tennessee, Texas A&M, Vanderbilt
Tags: Big Ten, ESPN, SEC, Wells Fargo
The SEC Network is seen as a sure-fire money-maker for the schools of the Southeastern Conference. The new channel — which is owned by ESPN, while the SEC owns the content — should get off to a quicker start than other leagues’ television channels.
Unlike the Big Ten and Pac-12, the SEC has just two media rights partners. CBS gets the first pick of SEC football games each week as well as the SEC Championship Game. That’s it in terms of football. ESPN has everything else. And that will allow ESPN and the SEC to put more good games on their network than other conferences that have had to shuffle games while also avoiding stepping on multiple partners’ toes. Better games should equal more demand for the SEC Network… which should eventually result in more households reached and, therefore, more money made.
When a friendly tipster suggested to us that ESPN would probably own the network and pay the league an annual fee (plus profits), we assumed that the deal would look quite a bit like ESPN’s Longhorn Network agreement with the University of Texas. In that set-up, Texas takes home a chunk of change from ESPN each year regardless of the network’s reach and growth (plus a percentage of profits once the channel makes money).
So far ESPN and SEC officials have been very quiet regarding the nature of their contract. But the SportsBusiness Journal reports — via industry sources — that the two entities “will share profits 50-50.”
Might the SEC receive a built-in, guaranteed annual fee from ESPN on top of that 50-50 split? Most assumed that it would and that’s certainly a possibility, but a lot of people around the SEC have been hinting that the league won’t get rich(er) over night.
The latest figure to suggest there will be a gradual ramp up in revenue is Texas A&M athletic director Eric Hyman. The Dallas Morning News quotes Hyman today as saying:
“In the Big Ten and Pac-12, neither of them started by driving around in a Wells Fargo truck.”
That comment — along with others of a similar tone provided by different league sources — doesn’t mean that the SEC Network won’t eventually be a massive cash cow for the league’s schools. Such talk does suggest, however, that ESPN won’t be paying the SEC a monster annual fee right from the get-go. Instead, it appears the league will be keeping a very close eye on the channel’s profits, of which it is expected to get a 50-50 cut.
Which means the battle to force the SEC Network onto various cable- and satellite-providers takes on even greater importance for the league’s 14 member institutions.
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