The Tier III myth

[Jericho]

I was restricting the FSU Tier 3 to the football and basketball games that drop down to a local Big-12 channel. As noted in the NC State link and in WVUs recent announcement the other stuff (radio, coaches shows, web sites, non revenue sports, etc) are treated the same and likely a wash between the two conferences based on the way they get bundled and sold to a single vendor.

Right. I think we are on the same page. To a certain extent, it's a matter of semantics. To some Tier 3 rights is defined to include everything from coach's shows to these bottom of the barrel tv rights. To others, it only means bottom of the barrel tv rights. The ACC schools have limited to no bottom of the barrel tv rights, but they can sell everything else. So the effective difference between the two conferences is something around 1 million dollars, or the approximate value of the tv rights portion.

 

[Duncan Idaho]

I thought cptv was intending to brodcast UConn's Olympic sports before the SNY deal went down?

 

[CTMike]

and my posts are long? Sheesh. At least I try to make mine readable and interesting. I stopped reading that after about paragraph 3.

Yes, but that's his only post of that length.

 

[RS9999X]

I"m not sure if UConn really had any part in SNY acquiring football and men's b-ball rights - I think ESPN owns the big east tiers - all of them. Similar to what they've got with the ACC now.

That was my understanding. Only God knows who the bundler or media consultant was that pushed the Coaches show and ESPN castoffs to SNY instead of CH 9 or whoever.

Will this be good? Or will this BE NBC regional thing be like one of Comcasts recently departed regionals -- "The .MTN--East".

 

[HuskyHawk]

and my posts are long? Sheesh. At least I try to make mine readable and interesting. I stopped reading that after about paragraph 3.

Thinking the same thing Carl...God forbid, I never thought I'd see the day.

 

[jrazz12]

Oh please, complaining about the length of that post. It's essentially a newspaper article on media rights and conference expansion that is about 200 times more useful than anything else written here. If you don't want to know what you're talking about and want to stick to your delusions, feel free.

Thanks for the post BU, very informative.

 

[Carl Spackler]

That was my understanding. Only God knows who the bundler or media consultant was that pushed the Coaches show and ESPN castoffs to SNY instead of CH 9 or whoever.

Will this be good? Or will this BE NBC regional thing be like one of Comcasts recently departed regionals -- "The .MTN--East".

SNY Is co-owned by Time Warner/Disney. It's the only network in the Comcast regional family that Time Warner also has stake in. So ESPN sending UConn tier 2 and 3 rights to SNY was essentially putting money back in their own pockets.

 

[WestCoastHusky]

can we talk about uconns tier 3 stuff here? what do we have and what can we get???
womens bball just signed a deal. isn't the radio contract up soon and were going to make a couple mill off that also? were about to upgrade puck. now hockey east has a contract with nesn right? btw we need to get nesn on tvs in fairfield county but anyway. could uconn sell its not nesn puck games to sny? that would be huge i would think also for the upgrade to be on tv in ct/ny/nj/pa.

UCONN has a 10 years, $80M deal with IMG. They manage all the advertising, coaches show, Website etc. This pays UCONN $8M per year.

http://ctsportslaw.com/2008/09/24/uconn-reaches-80-million-deal-with-img-college-for-media-rights/

UCONN also has a deal with Nike that pays UCONN $4.55M per year to wear Nike Stuff.

UCONN's women basketball tier-3 rights just signed for $1.14M per year.

That's $13.69M per year on top of whatever we are getting paid from the BE.

BE currently owns UCONN men basketball and football tier-3 rights. SNY I believe buys those from the BE or ESPN. Either way, UCONN is not getting any on those tier-3 rights. UCONN needs to keep those like B12 schools in the next BE TV deal. It is very important BE signs a deal like the PAC-12 or B-12 where individual school can control its own tier-3 rights. In the case of PAC-12, they have a conference so all the schools split that. If BE does not do a BE Network, then it is very important we keep our own tier-3 rights for men's bball and fball. I think between men's basketball and football tier-3 rights, UCONN can get another $7M to $8M. When UCONN enters Hockey East, there could be more rights we can sell to SNY. I think UCONN is capable of earning $10M or more in tier-3 rights on top of whatever new BE TV deal payout.

This is why tier-3 rights are very important to UCONN. This might be one reason we stay in the BE if we can keep that. If BE's new TV deal is in the mid teens ($15M+) for tier-1 and 2 rights, you can see why we will be in for a huge payday. With that, we will be well ahead of most ACC schools financially who are locked in for the next 15 years with ESPN.

One positive sign is ND wants to do its own network for tier-3 rights. In order to do that, BE has to let BE schools keep their own tier-3 rights. This is good news for UCONN because our tier-3 rights are worth a lot more than most BE schools.

 

[jrazz12]

Now that sounds more like it ^^^^^^

 

[Carl Spackler]

UCONN has a 10 years, $80M deal with IMG. They manage all the advertising, coaches show, Website etc. This pays UCONN $8M per year.

http://ctsportslaw.com/2008/09/24/uconn-reaches-80-million-deal-with-img-college-for-media-rights/

UCONN also has a deal with Nike that pays UCONN $4.55M per year to wear Nike Stuff.

UCONN's women basketball tier-3 rights just signed for $1.14M per year.

That's $13.69M per year on top of whatever we got paid from the BE.

BE currently owns UCONN men basketball and football tier-3 rights. SNY I believe buys those from the BE or ESPN. Either way, UCONN is not getting any on those tier-3 rights. UCONN needs to keep those like B12 schools in the next BE TV deal. It is very important BE signs a deal like the PAC-12 or B-12 where individual school can control its own tier-3 rights. In the case of PAC-12, they have a conference so all the schools split that. If BE does not do a BE Network, then it is very important we keep our own tier-3 rights for men's bball and fball. I think between men's basketball and football tier-3 rights, UCONN can get another $7M to $8M. When UCONN enters Hockey East, there could be more rights we can sell to SNY. I think UCONN is capable of earning $10M or more in tier-3 rights on top of whatever new BE TV deal payout.

This is why tier-3 rights are very important to UCONN. This might be one reason we stay in the BE if we can keep that. If BE's new TV deal is in the mid teens ($15M+) for tier-1 and 2 rights, you can see why we will be in for a huge payday. With that, we will be well ahead of most ACC schools financially who are locked in for the next 15 years with ESPN.

I don't understand any of that stuff much, but I like the way you present it, and I can follow it, and I've known all along that it was a bad idea to be locked into the kind of deal that the ACC has with ESPN, but never really understood why that might be. I think I get it now.

 

[WestCoastHusky]

I don't understand any of that stuff much, but I like the way you present it, and I can follow it, and I've known all along that it was a bad idea to be locked into the kind of deal that the ACC has with ESPN, but never really understood why that might be. I think I get it now.

The new ACC deal is horrible comparing to what B12 and PAC-12 just signed. People that don't understand the fine prints will just see $17M per school vs. B12's $20M per school. The reality is B12 schools with valuable tier-3 rights could easily earn way more than ACC schools.

This is why one smart thing BE did is hiring the same consultant that did the PAC-12 deal. ND is also pushing for its own network so that's a great sign UCONN will get to keep its tier-3 rights. If we can get $15M from tier-1 and 2 rights from NBC or whoever, we can add another $10M+ for our own Husky network. This will put us $25M+ per year vs. ACC schools who are maxed out at $16M (ACC takes $1M for admin fees) per school. We still got $12.55M ($8M IMG + $4.55M Nike) on top of that.

This is why the next TV deal is so important to UCONN. Also, don't underestimate the power of having someone like SNY as our partner. We could be promoted all week every week throughout 13.7M homes. It would be huge for recruiting for athletes and students.

 

[Dann]

great poat WCH. that makes me feel alot better about our $$ situation going forward.

 

[Carl Spackler]

The new ACC deal is horrible comparing to what B12 and PAC-12 just signed. People that don't understand the fine prints will just see $17M per school vs. B12's $20M per school. The reality is B12 schools with valuable tier-3 rights could easily earn way more than ACC schools.

This is why one smart thing BE did is hiring the same consultant that did the PAC-12 deal. ND is also pushing for its own network so that's a great sign UCONN will get to keep its tier-3 rights. If we can get $15M from tier-1 and 2 rights from NBC or whoever, we can add another $10M+ for our own Husky network. This will put us $25M+ per year vs. ACC schools who are maxed out at $16M (ACC takes $1M for admin fees) per school. We still got $12.55M ($8M IMG + $4.55M Nike) on top of that.

This is why the next TV deal is so important to UCONN. Also, don't underestimate the power of having someone like SNY as our partner. We could be promoted all week every week throughout 13.7M homes. It would be huge for recruiting for athletes and students.

I suppose that among the 17 other schools in the big east conference right now (either in, or coming) not all of them are in the same position as UConn. But if I'm following correctly, and we are able to do what you say, every single one of those schools will be able to approach regionalized network broadcasting companies in their own regions, to sell their own tier 3 rights, for whatever relative worth they can get in their own markets. (i.e....Houston and SMU would be able to sell tier 3 in texas.......UCF/USF in Florida.......Boise and SDSU in the west........)

And....with such a structure, expansion of west coast division of the Big East, would be a highly desireable place for school athletic departments that may still want a nice home to reside.....with the Pac 12 locked up.

or am I high?

 

[RS9999X]

More IMG info on the UConn contract

In addition to the $80 million guarantee, there are incentives built into the contract for UConn to recoup more money. If IMG takes in more than a given amount of revenues with regard to UConn's rights, the school will receive a bonus payment equal to 50 percent of the excess net revenue.

IMG also has as part of the deal is control of 21 suites at Rentschler Field. UConn turned over the luxury boxes -- a major piece of "inventory" as it's called in the athletic marketing business -- so they can be used in variety corporate packages.

Also as part of the agreement, IMG will purchase hundreds of season tickets to UConn home games, including 392 for football, 280 for men's basketball, 272 for women's basketball, 98 for men's soccer, 98 for women's soccer and 68 for men's hockey.

The total price of the tickets IMG has agreed to buy, which includes a number of single-game tickets and postseason tournament tickets, is $1,163,000. That money paid to UConn is in addition to the rights fee payments the school will receive each year.

There are a number of other cash payments UConn will receive that have been earmarked for specific projects.
IMG has pledged $2 million toward the construction of a new basketball practice facility. The payments will be made in four annual installments of $500,000.

Another $2 million from IMG has been earmarked for new signage, the majority of which will be spent on new video boards that will be installed in Gampel Pavilion this season.

http://www.newstimes.com/uconn/article/UConn-in-good-hands-with-IMG-deal-5027.php#page-1

 

[The Funster]

What happens to a school's self negotiated tier 3 deals if their conference signs an agreement that includes tier 3 rights?

I would not want to be a part of a conference that requires us to cede our tier 3 rights.

 

[CTMike]

I'm curious what the split of conference members is like regarding Tier-3 rights. I'd have to imagine that, say, a DePaul, wouldn't gain much with their own Tier-3 rights, and would therefore favor bundling them in to whatever deal the conference makes. I'm obviously much more in favor of UConn brokering their own Tier-3 deals.

 

[RS9999X]

Tier 3 isn't UConn's problem when it's all said and done. It''s the potential national games for football and BCS revenue issues. Basketball is still good. National Football on Saturday? Or Thursday or Friday? I'm skeptical. Regional only.

 

[Carl Spackler]

What happens to a school's self negotiated tier 3 deals if their conference signs an agreement that includes tier 3 rights?

I would not want to be a part of a conference that requires us to cede our tier 3 rights.

If I understand correctly, and the light bulb went off with WestCoast's post - is that tier 3 is basically what Delaney had the foresight to consolidate for the big 10 a long time ago, in forming the big 10 network. So ceding rights isn't necessarily a bad thing, if the conference is going to form it's own television network.

I'm not sure it's a good thing for us, right now to be doing, if a big east network is to be formed, b/c it sure looks like our tier 3 rights are a lot more valueable than others in this confererence, and there's the whole thing about hybrid membership, and Notre dame.

I think that if I'm understainding correctly, maintaining your own freedom to do what you want with your tier-3 broadcasting rights, is probably what the glue behind this thing is right now.

All just internet rumor and speculation of course.

 

[Carl Spackler]

Tier 3 isn't UConn's problem when it's all said and done. It''s the potential national games for football and BCS revenue issues. Basketball is still good. National Football on Saturday? Or Thursday or Friday? I'm skeptical. Regional only.

Joe Bailey made it very clear that the Big East conference role in the upcoming BCS discussions is going to be taken seriously, and that the Big East conference is very much invested in being a founding member of the BCS.

I don't know if anybody else actually listened to his press conference, and his intentions when it comes to doing regular media availability and how he did it, but if anyone else is old enough to remember it around here, I got the distinct impression of General Norman Schwartzkopf's regular media addresses during the Persian Gulf War.

 

[WestCoastHusky]

I suppose that among the 17 other schools in the big east conference right now (either in, or coming) not all of them are in the same position as UConn. But if I'm following correctly, and we are able to do what you say, every single one of those schools will be able to approach regionalized network broadcasting companies in their own regions, to sell their own tier 3 rights, for whatever relative worth they can get in their own markets. (i.e....Houston and SMU would be able to sell tier 3 in texas.......UCF/USF in Florida.......Boise and SDSU in the west........)

And....with such a structure, expansion of west coast division of the Big East, would be a highly desireable place for school athletic departments that may still want a nice home to reside.....with the Pac 12 locked up.

or am I high?

Correct. It will give schools much more options to get more $$$$ in addition to whatever they can get from the BE. PAC-12 decided to do a PAC-12 network which polled all schools' tier-3 rights together and share equally among all schools. Now this can work too if there is big $$$$ for everyone. In the PAC-12's case, Scott was able to convince USC to share equally with Washington State which is big accomplishment on his part.

The other way is what B12 is doing. Each B12 school gets to keep its own tier-3 rights and sell it for whatever. Texas was able to start Longhorn Network which will play them $15M per year for tier-3 rights plus 1 FB game. I am sure schools like Kansas and OU will do fine too, but schools like Iowa State might not get too much for their tier-3 rights. There is some talk that remaining B12 schools might poll their tier-3 rights together to do a B12 network less Texas/OU but I don't know how that's going.

In the BE's case, there are too many schools with unequal media worth. UCONN's tier-3 rights are worth a lot more than say SMU's tier-3 rights. Therefore, a BE network like the PAC-12 might not be the best option for us. In our case, we want to keep our tier-3 rights because we already got someone (SNY) who is very interested in them and is willing to pay big $$$$$$ for it. Since ND wants its own network too, I am guessing the new BE TV deal will be very similar to what PAC-12/B12 just signed. Also, BE is still talking to BYU and I am sure they want to keep their own tier-3 rights as well.

If BE is able to land with someone like NBC Sports, we could be playing in prime time far more than we are doing now. Exposure is important and I don't think ESPN can provide that for football. BE might be looking at splitting rights to multiple networks like PAC-12 to get better $$$$$. There are lots of ways to maximizing your revenue and that's why we got the PAC-12 consultant.

The future is looking good if UCONN ends up with this setup. We will be way ahead of ACC schools if BE can land somewhere close to $15M for tier-1 and 2 rights only with a network or multiple networks. This is also why ACC might not be the best option for UCONN if it is just based on $$$$$ alone.

 

[RS9999X]

. (i.e....Houston and SMU would be able to sell tier 3 in texas.......UCF/USF in Florida.......Boise and SDSU in the west........)

And....with such a structure, expansion of west coast division of the Big East, would be a highly desireable place for school athletic departments that may still want a nice home to reside.....with the Pac 12 locked up.

or am I high?

Houston is one of Comcasts 14 Regionals. The Cougars are part of the lineup now.

From the Houston Chronic: On the college front, the Houston-UTEP game last Friday on ESPN did a 4.7 Nielsen household rating in Houston. The Wyoming-Texas game Saturday on Fox Sports Houston rated 3.9.

 

[Jericho]

BE currently owns UCONN men basketball and football tier-3 rights. SNY I believe buys those from the BE or ESPN. Either way, UCONN is not getting any on those tier-3 rights. UCONN needs to keep those like B12 schools in the next BE TV deal. It is very important BE signs a deal like the PAC-12 or B-12 where individual school can control its own tier-3 rights. In the case of PAC-12, they have a conference so all the schools split that. If BE does not do a BE Network, then it is very important we keep our own tier-3 rights for men's bball and fball. I think between men's basketball and football tier-3 rights, UCONN can get another $7M to $8M.

This is my point about the Tier 3 myth. Where are you get these numbers that the UCONN Tier 3 rights will sell for $7-8 million? To who?

The entire Big 10 sells their entire Tier II rights for $7.5 million per team. A better conference. On a better tier. With more fans. Who's paying for these rights? Maybe if you combine the existing $8 million with Tier 3 rights, you get to $10 million

 

[WestCoastHusky]

This is my point about the Tier 3 myth. Where are you get these numbers that the UCONN Tier 3 rights will sell for $7-8 million? To who?

The entire Big 10 sells their entire Tier II rights for $7.5 million per team. A better conference. On a better tier. With more fans. Who's paying for these rights? Maybe if you combine the existing $8 million with Tier 3 rights, you get to $10 million

We just sold our women's basketball tier-3 rights to SNY for $1.14M. That's power of UCONN brand right there. Think of only blow out UCONN women games against bottom of BE. You don't think our men's basketball tier-3 rights is worth at least $3M? How about UCONN FB tier-3 rights? Let's put that to $3M too. That's $7.14M already. You add rights for all other stuff like volleyball, tennis, hockey and others, it is not far fetched to get the $10M+ per year.

FYI, I am pretty confident UCONN's tier-3 rights are worth a lot more than many B1G schools'. Why? We are in the better media markets. SNY put us in 13.7M homes already. We own Hartford/New Haven TV market and we also own a piece of NYC TV market. For people that don't know, Fairfield County is actually part of NYC media market. Fairfield County has close to 1M people so thats roughly 1/8 of the NYC TV market.

 

[RS9999X]

The entire Big 10 sells their entire Tier II rights for $7.5 million per team. A better conference. On a better tier. With more fans. Who's paying for these rights? Maybe if you combine the existing $8 million with Tier 3 rights, you get to $10 million

This is the slippery slope with an NBC deal. SNY would get all the games that Versus and NBC aren't interested in. One deal. No NBC appearances unless its Notre Dame or maybe Tennesee. Likely a UConn/Tenn ends up on Versus as the BE game of the week and the BE gets one time slot (or two) a week on Versus and none on NBC unless it's marquee to complement the Army/ND schedule.

(yes I know versus has a new brand name)

 

[RS9999X]

We just sold our women's basketball tier-3 rights to SNY for $1.14M. That's power of UCONN brand right there. Think of only blow out UCONN women games against bottom of BE. You don't think our men's basketball tier-3 rights is worth at least $3M? How about UCONN FB tier-3 rights? Let's put that to $3M too. That's $7.14M already. You add rights for all other stuff like volleyball, tennis, hockey and others, it is not far fetched to get the $10M+ per year.

FYI, I am pretty confident UCONN's tier-3 rights are worth a lot more than many B1G schools'. Why? We are in the better media markets. SNY put us in 13.7M homes already. We own Hartford/New Haven TV market and we also own a piece of NYC TV market. For people that don't know, Fairfield County is actually part of NYC media market. Fairfield County has close to 1M people so thats roughly 1/8 of the NYC TV market.

Aren't you double counting on some of this? ESPN pays for the rights now and then sells it downstream. If its NBC/SNY that kind of ends the discussion. They own the content and distribute it where they see fit and promote the games to Versus and NBC as they see fit.

What Tier 3 football would there be? That's the whole contract! Regional Tier 3 with maybe one home game getting promoted upstream a year.