Building a Foundation

Part 2

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Prior to about five years ago, expansion was addressed very rarely.   The Big Ten stayed at eleven members for years prior to moving to twelve and the SEC’s jump from ten to twelve was at a snails pace in contrast.   What is normally lost is that expansion isn’t something that needs to occur for a conference to survive.   Matter a fact, I could make the argument that not all expansion has been a success in recent years during the virtual land grab.

multilogospfoundationsmGenerally speaking, expansion occurs for one of two reasons:

1 – A school needs or desires a home for their athletics.

2 – A conference needs inventory for its media contract’s scheduling

That is really about it.  

Now, within those two aspects is a buffet of individual motivations that lead to the same conclusion.  

In preparation for this project I called on everyone I could find who may know a thing or two about not only the reasoning behind a conference or university moving, but also the numbers and legality of such moves.  I’ve used that to structure my approach to this topic.

A couple people I talked to pointed to Texas A&M’s move as an example of how complicated the process can be, especially from a legal perspective.   The Aggy’s were ready to move to the SEC decades ago as they attempted to remove themselves from the University of Texas’ powerful shadow.   However, at the time, the political forces within Texas wanted no part of having the Texas schools split up.   Looking back that was probably a terrible decision on their part as all it did was build more animosity within the system.

Within the last five years, however, that same political system was vastly different and much of the new power brokers were A&M alumni who could now support such a move to break from the remains of the old SWC.  Everyone I talked to stated unequivocally that the formation of the Longhorn Network did not have anything to do with A&M wanting to leave the Big 12.  They already wanted to leave.  However, what it did provide them was political cover to finally make that move.  The story that ESPN was going to show Texas high school football games on LHN never had a chance of happening, but it made great propaganda and was utilized so well that many people still quote it as the reason incorrectly to this day.

On the other side of the equation, sources within the SEC told me that after A&M reached out to them the office was very excited at the prospect.  They had talked often in the past, but the SWC history seemed like an impossible barrier.   Finding out it finally wasn’t was big news.

However, the main players in the SEC office became extremely worried about potential lawsuits from within the Big 12.   It quickly took some of the air out of the room as they went into lawyer mode.  The last thing the SEC wanted to be seen as is a bully or ruining relations with other peers.  Due to that, figuring out how to handle the situation with A&M was delicate to say the least.  

Even when presented a university they desired for a while, it still took a ton of effort to make it all work out.   The message here is that it is not just plug and play.  Expansion is not moving chess pieces around a board in an attempt to win the game.   Texas A&M and the SEC had been courting each other for decades and it was still a difficult process.   It was also a different process than adding Missouri, which did not have anywhere near the level of excitement as the A&M move within the SEC office, but I’ll touch on that in a future article. 

The Big Ten started looking into expansion when it needed to fill more of its cable channel.  The Pac 12 expanded to form a channel, the ACC added teams for protection, the Big 12 to keep their media deal whole, and the SEC expanded because they were courted.  All different processes; same conclusion.  

Expansion has been discussed within the Big 12 before and it is being discussed now. This time the harbinger is the dreaded “13th” game.   No one I talked to thought this had any legs from a stand point of the future health or viability of the Big 12.   Could the Big 12 change its position with a conference championship game? Yes, it is possible.  But it is just as possible that it would have zero effect or a negative effect on the health of the Big 12, depending on how expansion was structured within the league.  It is clear that changing your structure for the sake of a championship game alone is not reason enough to expand.  Doing so at its formation doomed the longevity of the Big 12.  The question becomes, when looking at teams, what do they bring to the Big 12 to justify a conference championship game?  It is not the other way around.

It is often forgotten on fan boards, that tend to be populated with people who throw trash at the moon, but once you invite a school, you cannot uninvite them.  You need to choose carefully or you might end up tied to the hip with a school that may not fit your culture or provide a long term benefit.

Pillars of Future Membership

 

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Any good foundation rests on solid pilings, so before we start discussing teams we need to look at the major aspects each university not only needs to face, but also excel in order to be considered.   Everyone I talked to mentioned these over and over again as either major issues to overcome or factors to make one school more viable than another (Alphabetical order):

pillar1pillar2Brand and Culture:  I combined these two because I think they go hand in hand, even though I have heard them discussed individually.  An university or athletic department or even a specific sport’s brand is usually easy to see, but difficult to describe.   In short branding encompasses the image of the school to the outside market.  Some schools, like Notre Dame, Texas, Alabama, or Ohio State, have gigantic brands built on decades of competition.  Some, like Boise State or Oregon, grew it recently by carefully manipulating their environment.  A school with a large brand will have more value to one without.   Harvard, as the nation’s first university, retains a gigantic brand despite basically not leveraging student athletics at all.

Within a school’s local market is where culture is built.   In much of the southeast from Texas to Florida the culture is college football.   Along the east coast, as evident by the creation of ESPN, that culture can be built by college basketball.  With many large state schools, the universities reflect the region they occupy.   We wouldn’t think that a school in Massachusetts would have much in common politically with a school in Montana, but the variations don’t need to be that wide to have meaning.

Buyouts:  Outside the SEC, all of the Power Five conferences have buyouts in some shape or form embedded within their bylaws.   These are one time payments at exit, generally correlate to a year or two of conference revenues, and are considered damages.  The reasoning for their existence is to repay the other member schools for any hardships they have to endure to replace the withdrawing member. Non-Power Five schools will generally have lower buyouts since they have less revenue than the Power Five.

Desire: Realignment over the past five years tended to have two courses of action; those who needed a new home and those who just wanted to be somewhere else.  In order for any university to move, there has to be a desire there for them to move.  Many of the best candidates, who fit all of these criteria, may still not be suitable because they just don’t see a need or there isn’t enough gained from the transaction.

Financial Support: Conferences, first and foremost, exist to support athletic teams.   Athletics serve to support the overall mission of a university.   In the Big 12, like the SEC, the bulk of that is football.   Even Iowa State invests heavily in their football program compared to the bulk of the FBS and would most likely perform better in other conferences.  If a school does not or cannot sustain support for multiple sports, including football, then they won’t bring anything to the equation.   

 Grant of RightsGrant of Rights (or GoRs) are often misunderstood, but they serve as a way to bind teams together who want to be together.   They are not buyouts.   They are not easily broken.   They are legal agreements where schools have signed away their rights to their home games to the conference for a period of time.  Since a school does not own its rights for that time period, they cannot promise them to another conference nor do they need to be paid on those rights if they are not a member of the conference who holds the rights. 

The ACC, Big Ten, Big 12, and Pac 12 all have GoR’s in place.

Location The potential targets that some people throw out there trying to drum up eyeballs are mind boggling and don’t take a lot of things into consideration, namely geography.   All of the teams that have moved conferences, outside TCU, have seen their travel budgets expand.  It is easy to think, “well it is only 3 hours by plane” but expansion doesn’t just effect a football team that plays once a week.   It effects fifteen to twenty plus other sports, all of which need to be transported to partner schools for an entire conference schedule.   That, is a big deal.

Media Deals:  Each and every conference in the FBS has some sort of media contract that provides exposure and revenue for the home games the conference provides a network or group of networks.  The Power Five deals all make about the same amount of revenue, but that wasn’t always the case.   In the past some conferences, like the Big Ten, had sold more of their inventory than the others, which led to differences in total revenue.  It is extremely difficult to compare two media deals for various reasons, but how they are set up will play a large part in future expansion. 

Structure:  You cannot discuss expansion without discussing how the new teams will affect the make-up of the conference.  By this I do not mean how they will fit it, but instead how will divisions work.   This can make a tremendous difference in the competiveness of a conference or in its perception. 

There are the main factors we need to address before discussing any expansion opportunities for the Big 12.  In the next few weeks I will go through each one in more depth.   Afterward I’ll begin comparing possibilities against these factors.

If there are any universities you’d like considered, send me a message or leave a comment with your reasoning.

 

If you have any questions or would like some numbers discussed, contact The Number Monkey on Twitter @TheNumberMonkey or via email [email protected]

©2015 Number Monkey Media

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