Because of perceived value...the Irish are one of the most watched teams in the country. And there aren't many huge brands left to grab.
I answerd your question straight up..but realize it may not have been a question but a "grump".
There is also the five football games a year deal and the "ND football can only join the ACC " deal.So let me just restate my original post with the corrected assumptions:
Let’s say the value of the ESPN contract is 40 million per school. We know from the special section Notre Dame in the ACC bylaws that the value of football is 80% of that contract. Notre Dame football is independent and not a part of the ACC contract. so the value of Notre Dame‘s grant of rights to the ACC for everything but football would be equal to $8 million a year. The ACC grant of rights runs through 2036. So Notre Dame is theoretically on the hook for $112 million over 14 years. If you consider the time value of money and discount that back to a single payment, depending upon the assumption to use, it’s probably 70 million give or take.
Now keep in mind that’s just the grant of rights. They also have to pay whatever exit fee is applicable. The bylaws provide that the exit fee is equal to three times the operating budget of the ACC. The ACC takes a full membership share for their operating budget. So under our hypothetical $40 million annual distribution the exit fee would be $120 million. That means collectively they can get out of their partial conference membership for approximately $190 to $212 million.
Now, if you had the opportunity to make $100 million per year, every year on a go forward basis, would you be willing to pay $190 million for that privilege? If Notre Dame decides it wants to leave the ACC, the cost of exiting isn’t going to stop it.
Thanks to @TerryD, @JeepCSC and @FfldCntyFan for their help filling in the pieces
My best estimate is 130 million to 200 to make a clean, expensive break. Do think that is in the ballpark? Or will/would it drift higher?There is also the five football games a year deal and the "ND football can only join the ACC " deal.
Both run through 2036. If ND breaches those deals, that would mean additional damages paid to the ACC.
For sure, it would be worth it. It would be the largest exit fee in history though. I assume we may get assistance if that occurred.Even if it costs $200 million for Notre Dame to make a clean break from the ACC, that is less than two years worth of B1G media rights revenue. Not counting playoff revenue, bowl revenue, basketball tournament revenue, etc.
Plus, the media rights revenue will only increase with ND as a member of the B1G, which in turn makes it easier to pay that off.
The five football games are expressly out of conference games according to the Notre Dame section of the contract. Would the ACC even have standing to pursue that? I guess the individual schools could.There is also the five football games a year deal and the "ND football can only join the ACC " deal.
Both run through 2036. If ND breaches those deals, that would mean additional damages paid to the ACC.
They probably give you the “Rutgers“ deal where they would front some of your anticipated earnings. For a school as deep pocketed as Notre Dame, I’m not sure that makes sense though.For sure, it would be worth it. It would be the largest exit fee in history though. I assume we may get assistance if that occurred.
They probably give you the “Rutgers“ deal where they would front some of your anticipated earnings. For a school as deep pocketed as Notre Dame, I’m not sure that makes sense though.
SWW we s are
Agree to an extent (not sure of loan forgiveness).USC and UCLA don’t have to buy-in. Notre Dame wouldn’t either. And I’m sure if they asked, the Big 10 would “loan“ them interest-free the money to buy out the ACC contract, and then forgive the loan a decade or so later.
Agree to an extent (not sure of loan forgiveness).
If the Big Ten insisted that ND take a smaller payout for years AND entirely fund the $200 million plus ACC exit, I don't think that would be a winning pitch to secure ND into the Big Ten.
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Seeing a lot of UConn mentions. Where there’s smoke there’s fire…