WVU's Gee: going to 12 is most likely

[CL82]

As I've made clear, I don't believe any of this crap at this point. But it would be rational for Texas to agree to roll the LHN into a Big XII Network if they are guarantied their current take for the length of the existing LHN arrangement.

But would it be logical for ESPN to make that guarantee? I'm sure the other schools would expect at least some money to come there way as well. Does ESPN value the Big 12 enough to add to it's investment or does Big 12 instability increase the value and stability of ESPN's house band the ACC? I think that's another potential stumbling block.

 

[Carl Spackler]

But would it be logical for ESPN to make that guarantee? I'm sure the other schools would expect at least some money to come there way as well. Does ESPN value the Big 12 enough to add to it's investment or does Big 12 instability increase the value and stability of ESPN's house band the ACC? I think that's another potential stumbling block.

A quick google search tells me that ESPN/ABC are splitting football content with Fox, but ESPN owns all of big 12 basketball, including the conference tournament.

Adding UCONN basketball women's and men's to the picture has got to be meaningful, as well as introducing big 12 football regularly at least 6 times a year into the hartford/new haven and NYC demographic.

 

[businesslawyer]

But would it be logical for ESPN to make that guarantee? I'm sure the other schools would expect at least some money to come there way as well. Does ESPN value the Big 12 enough to add to it's investment or does Big 12 instability increase the value and stability of ESPN's house band the ACC? I think that's another potential stumbling block.

You misunderstood. The other Big XII members would have to let Texas have its guarantied take first, before they split money. and the answer to "would they" is it's not costing them anything up front, it's temporary and without it there is no Big XII long term.

 

[DarthGrumpy]

LOL, was going to post the same thing. Please let it be us, please let it be us, please just this one time, let it be us.

Anybody remember gym class from elementary school when teams were picked...

 

[Carl Spackler]

You misunderstood. The other Big XII members would have to let Texas have its guarantied take first, before they split money. and the answer to "would they" is it's not costing them anything up front, it's temporary and without it there is no Big XII long term.

I see three pieces here, in Texas - ESPN - and the Big 12 conference offices. There is a fourth - in Fox television, but not so much involved.

I see no reason that Texas, currently, is anything but in a position of great strength right now in any negotiation. Not a good position for anybody that wants change. They've got the contract with ESPN. ESPN would gladly negotiate the terms of the LHN contract, I think, but that doesn't mean much - if Texas doesn't want to talk. As for the Big 12 conference offices - they're obviously the piece of the puzzle that can change how Texas feels about talking. That doesn't mean they'll change the position of Texas being in the position of strength in a negotiation, unless they manage to do something, to both motivate Texas to sit down at a table, and put them in position of less strength than they're in now.

The only thing that I think can be done, toboth put Texas into a chair at a negotiation, and into a weak position, is for the other 9 members of the conference to essentially put them on a notice that they're going to get booted from the conference, if the $ numbers are right, such that the conference can continue making what it makes now, with other membership other than Texas - or make more - for it's membership through a conference network and broadcasting deal.

ESPN - I'm sure would have input into how that would work - as well as Fox, and CBS, etc.

 

[CallMeBruce]

There is a 0% chance that the Big 12 expels Texas. That doesn't even pass the smell test.

 

[businesslawyer]

I see three pieces here, in Texas - ESPN - and the Big 12 conference offices. There is a fourth - in Fox television, but not so much involved.

I see no reason that Texas, currently, is anything but in a position of great strength right now in any negotiation. Not a good position for anybody that wants change. They've got the contract with ESPN. ESPN would gladly negotiate the terms of the LHN contract, I think, but that doesn't mean much - if Texas doesn't want to talk. As for the Big 12 conference offices - they're obviously the piece of the puzzle that can change how Texas feels about talking. That doesn't mean they'll change the position of Texas being in the position of strength in a negotiation, unless they manage to do something, to both motivate Texas to sit down at a table, and put them in position of less strength than they're in now.

The only thing that I think can be done, toboth put Texas into a chair at a negotiation, and into a weak position, is for the other 9 members of the conference to essentially put them on a notice that they're going to get booted from the conference, if the $ numbers are right, such that the conference can continue making what it makes now, with other membership other than Texas - or make more - for it's membership through a conference network and broadcasting deal.

ESPN - I'm sure would have input into how that would work - as well as Fox, and CBS, etc.

Texas isn't being booted from their conference. Come on.

I have seen customers kill off their suppliers because they demand too many concessions, the suppliers fail and the customer is then screwed. Texas's incentive to do something is that if they do nothing and push OU out, they are guaranteeing that the Big XII will not be at the grown ups table for long. And if Texas wants to stay in the Big XII, they will have to take less than they could negotiate for to make that happen.

 

[mavblues]

You misunderstood. The other Big XII members would have to let Texas have its guarantied take first, before they split money. and the answer to "would they" is it's not costing them anything up front, it's temporary and without it there is no Big XII long term.

Why BEFORE they split the money? You split the money, guaranteeing Texas a certain minimum (to match what they would have made under LHN).

Below examples assume $100MM for B12N:

Ex 1: (your way)
$100MM - $15MM = $85MM / 12 = $7.08MM each, with Texas getting $22.08MM

Ex 2: (how they will likely do it)

$100MM / 12 = $8.33MM each; however, Texas is guaranteed $15MM, so $15MM - 8.33MM = $6.67MM / 11 members = $606K subsidy (each) to Texas.

Thus, Texas gets their $15MM, each other school gets $8.33MM - $606K = $7.72MM

The Texas guarantee will likely have a sunset provision, and there would be no subsidy once/if B12N hits $180MM (since each school would then be getting $15MM).

In exchange for taking a relatively small haircut (likely only for a certain period of time), you eliminate the LHN, create a B12N, and expand the conference's footprint. Everybody comes out ahead of where they are now, and Texas preserves it's current revenue stream - at least for a certain period of time.

 

[FDNY99]

I don't have LHN on my subscription and I get just about every single sports network imaginable. That's not to say it isn't on somewhere here in the northeast. But I doubt I'm the only one who doesn't get it on our package. And honestly, even if I did get it, I would NEVER watch it...unless UConn was playing Texas. If they become conference mates, maybe I would watch it.

It's available on Fios in Westchester (and I'm assuming Fairfield County too if Fios is available) with the On-Demand feature.

 

[businesslawyer]

Why BEFORE they split the money? You split the money, guaranteeing Texas a certain minimum (to match what they would have made under LHN).

Below examples assume $100MM for B12N:

Ex 1: (your way)
$100MM - $15MM = $85MM / 12 = $7.08MM each, with Texas getting $22.08MM

Ex 2: (how they will likely do it)

$100MM / 12 = $8.33MM each; however, Texas is guaranteed $15MM, so $15MM - 8.33MM = $6.67MM / 11 members = $606K subsidy (each) to Texas.

Thus, Texas gets their $15MM, each other school gets $8.33MM - $606K = $7.72MM

The Texas guarantee will likely have a sunset provision, and there would be no subsidy once/if B12N hits $180MM (since each school would then be getting $15MM).

In exchange for taking a relatively small haircut (likely only for a certain period of time), you eliminate the LHN, create a B12N, and expand the conference's footprint. Everybody comes out ahead of where they are now, and Texas preserves it's current revenue stream - at least for a certain period of time.

LOL. You parsed my words far more closely than they were written for.

frankly, if they try to strike a deal it's likely to be something in between your two scenarios.

 

[Carl Spackler]

Texas isn't being booted from their conference. Come on.

I have seen customers kill off their suppliers because they demand too many concessions, the suppliers fail and the customer is then screwed. Texas's incentive to do something is that if they do nothing and push OU out, they are guaranteeing that the Big XII will not be at the grown ups table for long. And if Texas wants to stay in the Big XII, they will have to take less than they could negotiate for to make that happen.

So unwilling to accept what on face value may be so ridiculous as usual. All of this is hypothetical BS, and my opinion on potential things happening - is accurate - doesn't mean it couldn't or wouldn't happen.

Where is OU going to go? Texas has no incentive to do anything - based on your idea, until OU has a viable option to do something else. THe only thing OU can control, is what they can control from within their own conference. If OU has figured out how to move into another conference, without being asked to move into that conference - we at UCONN, need to copy that immediately. If OU moves into another ocnfernece? What happens to Texas, will only be a small part of a major issue nationally again. That - my lawyer friend - is not happening.

THe reality is that Texas not only doesn't have to sit down an talk about anything with anyone, even if they did - they will be in a very strong position of negotiation. Not good for anyone else. You yourself have noted this. Only way Texas would agree to any change or modification tot eh Big 12 confrerence itself, (which would mean a big 12 conference television network deal) , is if their current take doesn't change. THey already have managed to reach a situation where nothing needs to change regarding a conference championship game.

How does that change? Simple Texas gets faced with the real possibility of life as an independent as a full athletic department. THe scheduling issues that Texas would immediately face, don't you think that such a situation would immediately at bare minimum level the playing field for ESPN to start talking about either voiding the LHN contract entirely, or seriously renegotiating?



I was pretty clear - that it would be in the big 12 conference 9 other current members to have a plan already in place, to move forward at least at the same revenue scale without Texas, that they have now - with Texas.

That's what seems unrealistic, but how do you know if that's possible - if they don't explore it and figure that out?

 

[Carl Spackler]

LOL. You parsed my words far more closely than they were written for.

frankly, if they try to strike a deal it's likely to be something in between your two scenarios.

There is absolutely no reason to think anything is going to change with the Big 12 conference, at any time - until Texas feels like they need to sit down at a negotiation table.

They already got through a vote about the 10 membership - conference championship issue. The other members can pitch whatever they want, and it can make the most rational sense in the world, and Texas - still would have no reason to sit down and talk.

Any expansion issues - any vote - will involve the dynamics of the other 9 members, with Texas being a swing vote, and in that case, we as UCONN - need to be friends with Texas.

 

[IMind]

Why BEFORE they split the money? You split the money, guaranteeing Texas a certain minimum (to match what they would have made under LHN).

Below examples assume $100MM for B12N:

Ex 1: (your way)
$100MM - $15MM = $85MM / 12 = $7.08MM each, with Texas getting $22.08MM

Ex 2: (how they will likely do it)

$100MM / 12 = $8.33MM each; however, Texas is guaranteed $15MM, so $15MM - 8.33MM = $6.67MM / 11 members = $606K subsidy (each) to Texas.

Thus, Texas gets their $15MM, each other school gets $8.33MM - $606K = $7.72MM

The Texas guarantee will likely have a sunset provision, and there would be no subsidy once/if B12N hits $180MM (since each school would then be getting $15MM).

In exchange for taking a relatively small haircut (likely only for a certain period of time), you eliminate the LHN, create a B12N, and expand the conference's footprint. Everybody comes out ahead of where they are now, and Texas preserves it's current revenue stream - at least for a certain period of time.

I think they actually need to convince Texas that they'd make MORE money with a Big 12 network than the LHN. Lure them with the absurd amounts of money the SEC and B1G channels are making. Convince them: Expand the footprint, drop the LHN, get larger channel carriage fees in the markets you're already in, and make ESPN more money because they've got a better product to advertise... the Big 12's problem has always been that they never operate together. They've always had one of the worst TV contracts, etc.

 

[Carl Spackler]

I think they actually need to convince Texas that they'd make MORE money with a Big 12 network than the LHN. Lure them with the absurd amounts of money the SEC and B1G channels are making. Convince them: Expand the footprint, drop the LHN, get larger channel carriage fees in the markets you're already in, and make ESPN more money because they've got a better product to advertise... the Big 12's problem has always been that they never operate together. They've always had one of the worst TV contracts, etc.

This is the opposite thought process to my hypothetical bullsh--t. Ideal for sure. The same principle applies. The other 9 members of the conference got to put a plan in place, such that they're expanding and making at least the same money that they're making now. In that case, they can sit the good ole lone star state U down at a table and begin to talk business from a negotiating position that's at least even.

Because it stands to reason, that everybody would be better off with Texas, but if Texas is going to continue to be a thorn - then buh bye. Start working the phones to get sports scheduled as an independent, and let ESPN deal with the contract, and play your chances of landing elsewhere. It seems like wisdom would prevail, you'd hope, and that kind of hardball wouldn't happen.

THe real questions I see - are how much does ESPN really want to make the current longhorn network contract either go away, or be modified - and how much can the other nine big 12 members make, if they were to expand to 12 with Texas or without, or even 14 schools with or without Texas? Would the numbers make it possible? It's pretty clear that keeping Texas would be the ideal - but could the numbers work out similar - equal - or at least similar enough to make the powerplay worth it? I don't know. Only one way to find out - and I'm not in position to do that, but I'm sure there are people that could.

A theoretical hypothetical play like this - would invovle somebody being left holding the bag again. Somebody would get left standing without a chair again - and it would either Texas, or a school that would have been the last school in after booting Texas to independence with their TV deal - like BYU, and Notre Dame.

I just don't want UCONN to be left standing alone again, because we haven't worked the phones, and built all the necessary relationships and done everything possible, so that the next time there is a vote, we don't have enough votes.

 

[mavblues]

LOL. You parsed my words far more closely than they were written for.

frankly, if they try to strike a deal it's likely to be something in between your two scenarios.

But I Math'd...

 

[CAHUSKY]

I don't have LHN on my subscription and I get just about every single sports network imaginable. That's not to say it isn't on somewhere here in the northeast. But I doubt I'm the only one who doesn't get it on our package. And honestly, even if I did get it, I would NEVER watch it...unless UConn was playing Texas. If they become conference mates, maybe I would watch it.

That's what I thought until my DVR automatically recorded a replay of the UCONN v. UT basketball game the other day. Never had a clue LHN was available on DirecTV.

 

[CallMeBruce]

Somebody would get left standing without a chair again - and it would either Texas, or a school that would have been the last school in after booting Texas to independence with their TV deal - like BYU, and Notre Dame.

What does this mean?

 

[mavblues]

That's what I thought until my DVR automatically recorded a replay of the UCONN v. UT basketball game the other day. Never had a clue LHN was available on DirecTV.

You now owe UT $1.25

 

[CL82]

You misunderstood. The other Big XII members would have to let Texas have its guarantied take first, before they split money. and the answer to "would they" is it's not costing them anything up front, it's temporary and without it there is no Big XII long term.

No, I understood, I just don't see it happening. If a team objects to the LHN, wouldn't you object to giving up your Tier 3 rights for no compensation in order to have a "Big 12 Network?" If the LHN is already a money loser for ESPN, why would they dump more money toward a Big 12 Network? The money for the other Big Twelve teams has to come from somewhere and I doubt that Texas is going take a dollar less for a Big 12 Network than they are currently making from the LHN.

 

[CL82]

Why BEFORE they split the money? You split the money, guaranteeing Texas a certain minimum (to match what they would have made under LHN).

Below examples assume $100MM for B12N:

Ex 1: (your way)
$100MM - $15MM = $85MM / 12 = $7.08MM each, with Texas getting $22.08MM

Ex 2: (how they will likely do it)

$100MM / 12 = $8.33MM each; however, Texas is guaranteed $15MM, so $15MM - 8.33MM = $6.67MM / 11 members = $606K subsidy (each) to Texas.

Thus, Texas gets their $15MM, each other school gets $8.33MM - $606K = $7.72MM

The Texas guarantee will likely have a sunset provision, and there would be no subsidy once/if B12N hits $180MM (since each school would then be getting $15MM).

In exchange for taking a relatively small haircut (likely only for a certain period of time), you eliminate the LHN, create a B12N, and expand the conference's footprint. Everybody comes out ahead of where they are now, and Texas preserves it's current revenue stream - at least for a certain period of time.

I like the logic of this but where is the $100M coming from?

 

[Carl Spackler]

What does this mean?

I probably did a crap job of laying out the hypothetical sceneario because I'm typing fast. My hypothetical, involves the 9 members of the big 12, other than Texas - doing the homework and legwork, and backroom work to find out that by expanding the conference, if they can make at least the same money now in a variety of circumstances - most importantly - how much could be made - by NOT including Texas in the conference picture.

I honestly don't know if it would be possible or not, and all my bullsh-t ends right there - if it's not - but I don't know that to be the case, so it's play time on the internet to let the thoughts go forward.

So playing along, going through as many scenarios as possible - the conference decides expansion is in the best interest, and they're able to present Texas with an offer they can't - or shouldn't refuse. Drop the longhorn network, and void the contract with ESPN, or get out of the conference, and play the dice with their ESPN contract and independence in scheduling football - like BYU and Notre Dame.

That certainly wouldn't be ideal for everybody - but if the money is right, and it would be possible - then you do it for the other 9 schools to preserve their best interests.

But in all this hypothetical, there would be one school - no matter what - that is left out. It would be either Texas pushed out - in favor of the schools chosen for expansion. Or the schools chosen for expansion minus one - because TExas stays.

I wouldn't want UCONN to be the one with the least votes, that ends up being that minus one.

It's all hypothetical baloney. Tooliing around on the internet.

The reality - is that sooner or later, another vote is going to come up regarding conference membership and changing conference membership - and I don't want UCONN to be left on the beach in Caribbean -

(see what I did there?)

I'm out on this. Enough playtime on the internet today.

And again - it's all bullsh----t.

I know nothing, and even if I did - I do NOT leak.

It's pretty clear - that

 

[mavblues]

I like the logic of this but where is the $100M coming from?

From my post:

"Below examples assume $100MM for B12N:"

 

[CL82]

From my post:

"Below examples assume $100MM for B12N:"

I got it. Here's another one. Assume UConn gets a $1 billion ten year deal in order to start "The UConn Network for Entertainment and Sports (TUNES), does it make sense to go independent and take this deal? Of course, it does. Will it happen? Unlikely.

 

[CL82]

Hmmn, maybe the money for Big Twelve Network is there...

Linky

 

[pj]

It's still a net positive for U of Texas. The goal of Texas is to do what is best for them and not what keeps the biggest distance between them and a few other schools near them. There may be a few boosters that like it the way it is, but the university president and the vast majority of alumni will want what is overall best for the University IMO.

If Texas is committed to staying in the B12, then folding LHN into a B12 network with Texas getting the first $15 mn of network earnings would be a positive solution. B12 network would outsell LHN so more upside for them.

However, if they are considering exiting the B12, doing that would tie them more closely to the B12 and make exit harder. Right now, if they leave they can take LHN with them. If they fold LHN into B12 network and then leave, they lose it.

Texas can get an invite anywhere (B1G, Pac, SEC, ND-type deal to ACC) so there is a lot of optionality they give up by committing to B12.

 

[mavblues]

I got it. Here's another one. Assume UConn gets a $1 billion ten year deal in order to start "The UConn Network for Entertainment and Sports (TUNES), does it make sense to go independent and take this deal? Of course, it does. Will it happen? Unlikely.

If anything, I think the $100MM I used was extremely conservative. Numbers for the SEC network were just released, and B12N won't be starting from scratch - LHN already has distribution agreements that would most likely be retained/expanded.

Why do you feel that the $100MM is so incredibly unrealistic? Live sports content is still key, even in this era of cord cutting.

EDIT: I see you followed up your original post by posting the link to the SEC network's numbers.

 

[Slasher]

The one key point a lot of people are missing here is that the LHN is a failure because no one outside of Texas fans/alums cares about it. If it morphs into Big 12 network, than the state of Oklahoma, Kansas, SW Ohio, (assuming Cincy), Connecticut and parts of NY and MA (assuming UConn) cares. That triples the footprint of the cable carriage fees, thus making it more profitable for ESPN. I forgot WV and IA but you get the point.

 

[CL82]

If anything, I think the $100MM I used was extremely conservative. Numbers for the SEC network were just released, and B12N won't be starting from scratch - LHN already has distribution agreements that would most likely be retained/expanded.

Why do you feel that the $100MM is so incredibly unrealistic? Live sports content is still key, even in this era of cord cutting.

EDIT: I see you followed up your original post by posting the link to the SEC network's numbers.

After your post I saw the SEC numbers, and they are stunning. I'm still skeptical if Big 12 content can make enough to breakeven on the LHN and pay $$ to the remaining conference members. Still, if I would be glad to be wrong.

 

[HartbeatHusky]

http://espn.go.com/blog/big12/post/...ay-mailbag-expansion-title-contenders-in-2016

@BChatmon @ESPN_Big12 what is the likelihood the Big 12 expands and adds UConn

— Husky Army (@thehuskyarmy) January 19, 2016

Chatmon: I'm starting to believe we're inching closer to expansion, but it still won't be anytime soon. Frankly, there aren't a lot of really good, available options, but UConn would be worth considering. I would still say it's unlikely, mainly because expansion is a ways away and a lot can happen before then.

 

[WestCoastHusky]

B12 Network is a must if B12 is to survive. There isn't another option. Texas has to play team ball or B12 will die sooner or later. If they want markets, no one can deliver it better than UCONN. B12 better invite us so now if they want to go to 12 and start a network. I am hoping B1G will realize losing us will have consequences. UCONN brings a lot more than just state of CT.