Surprisingly, Pac-12 now wants to negotiate its media rights deal. Does it come from a position of strength?
If USC and UCLA’s entry into the Big Ten was act one of Pac-12’s realignment, act two began in earnest on Tuesday.
The conference brought this to the attention of the rest of the college football world this morning, saying they would immediately go to the negotiating table on their media rights deal, which expires in 2024.
It’s not exactly the move you’d expect from a league that just lost its biggest media market and two biggest brands — USC football and UCLA basketball. It’s an even stranger move considering reports all weekend suggesting the Pac-12 could see more departures in the coming weeks.
But the surprising timing of the Pac-12’s announcement has led many to believe a plan is being formulated behind the scenes that could potentially keep the league intact. A senior Utah source told The Salt Lake Tribune on Tuesday the league remains “tied together” for now and Utah remains committed to the conference.
Now, when the Pac-12 comes to the negotiating table, it believes it is coming from a position of strength. Which either means the conference thinks it can keep or expand its remaining 10 members.
Last week, the prevailing notion was that Oregon and Washington would be next to leave the conference — to either the Big Ten or the Big 12. CBS Sports also reported that Utah, Arizona, Arizona State and Colorado were in intense talks moving on to the big 12
However, a source within Utah’s athletic department said it was “manifestly wrong” that any of those schools were holding a Big 12 meeting. Colorado and the state of Arizona also issued statements in support of the Pac-12 and its decision to start negotiations now.
However, the problem for the conference remains that simply retaining its members is not enough.
After the departure of USC and UCLA, future earnings projections from a media rights deal for the entire conference have dropped by nearly $200 million. With USC and UCLA in the Pac-12, studies projected that a new Pac-12 media rights deal would be in the $500 million range. Now, a former FOX Sports executive estimated a new deal would be worth about $300 million.
This means significantly less revenue for each individual member, not to mention playing in a league with diminished power and no obvious route to the college football playoffs.
The Pac-12 could add Mountain West teams like San Diego State and Boise State. But with these two schools in smaller media markets, the added value of a media rights deal wouldn’t make up for the loss of the two big schools.
The better option, at least up to this point, would probably be to merge the Pac-12 with either the Big 12 or the ACC. Pac-12 insider John Canzano reported that Pac-12 is actively investigating what a “loose merger” of Pac-12 and ACC would look like.
The combination of Pac-12 and ACC’s existing media markets could be lucrative for ESPN in a negotiation. The ACC has schools in Boston, Washington DC and Atlanta. The Pac-12 brings Denver, Seattle and Salt Lake City.
But for this scenario, and most scenarios, the first step would be to keep the existing members in the Pac-12. Oregon and Washington remain cherished destinations for expanding conferences like the Big 12 and even the Big Ten down the line.
While Colorado issued a statement in support of the Big 12, it also has a Board of Regents tonight that meets to get “legal advice” on how to handle the Pac-12 situation.