We have at least another 5-7 years to get our football program back to the
right track and make us attractive again for big 2 conferences. GOR is unbreakable, and if programs like VT, NCSU, UVA,ULou don’t get guaranteed invites to Big 2, they would not get enough votes to dissolve ACC. I don’t think any athletic department can realistically leave ACC before 2030 or even later with GOR and exit fees. So I think we are in OK shape anyway.
** Edited by icelus at 8/15/2023, 3:14:16 AM
56 Replies
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WarHog38
2y
I think a lot can be gathered by looking at the past in relation to the future with expansion. Who would have thought Stanford, Washington State, Oregon State, would all be headed down the river to the G5 in 2024? Nobody would have predicted that a few years ago.
I think one can tell the future to some extent in the ACC with that. I also keep hearing that FSU & Clemson don't currently even have P2 invites. Is that just because P2 plates are already full with all the changes coming in 2024? Are do the P2 have other concerns about further expansion?
I think big changes are coming in college football that could be adding precautions with P2 further expansion. Media revenue being shared with football athletes as paid employees is that big change. It is going to massively cut into the revenue pie received with the P2 and literally all the major college athletic programs. That is going to further separate the Haves & Have Nots to a large degree. Will any conferences but the P2 even be able to compete with the athletes necessary to do so? Recruiting the better athletes for none P2 schools will become much tougher.
I think all this may limit further expansion by the P2. More Stanford's in the ACC. As few schools as four could be taken. With the Big 12 being the bigger recipient of ACC schools just like with the PAC.
Virginia Tech getting better in football in the next few years in the most favorable option. Not an impossible task. The Hokies were a very respected football program with Frank Beamer. The Hokies just need that type head coach. A smart coach with the X's & O's, along with being a good recruiter & motivator. That is all it takes all across the college football landscape. Just hard to find that type coach these days. Everybody wants nice guys that can entertain & handle themselves with the media & fans. Those qualities should not even matter.
(In response to this post by icelus)
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WBGV
2y
and going to the SEC. Both schools pay the exit fee of $120 million (or a negotiated reduced amount ). Losing two schools enables the “composition clause” in the media rights contract to be exercised by ESPN. The “composition clause” allows either the conference or ESPN to reopen the contract if membership increases or decreases by at least two schools. It was used when Syracuse & Pitt were added to the ACC.
According to the Sports Business Journal, “the agreement does not permit the ACC to take its rights to the open market. If the two sides cannot come to an agreement, the deal would go to an arbitrator.” If ESPN & the arbitrator agree that the ACC contract without FSU & Clemson is now worth say only 3/4 the value, then every school’s media right payout would be cut by 25% all the way to 2036. The ACC still owns the media rights for FSU & Clemson’s home games, but they aren’t playing ACC opponents anymore either at home or away.
Now let’s say two other schools decide to leave like North Carolina and NCST to the SEC, then the composition clause kicks in again and there is a further reduction to the media rights payout. And then ND and Virginia decide to go to the B1G, the compensation clause kicks in again and there is a further reduction to the media rights payout. The option of all 6 schools leaving at the same time is there too. At this point the membership will be down to 9 schools with a media rights payout probably only a little better than the AAC.
Once enough of the current ACC membership accept the inevitable (the magnificent 7 or elite 8 may have already accepted it ), they will come together and dissolve the conference making the plan above unnecessary. 10 schools will find homes in what will now be the power three conferences of 20 schools each. And the remaining 5 schools will be in a similar situation as OSU, WSU, Stanford, and Cal are today. Look for FSU and Clemson to start their plan by announcing their intent to withdraw from the ACC sometime before August 15, 2024.
** Edited by WBGV at 8/15/2023, 2:07:19 PM
(In response to this post by icelus)
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hokieZ71
2y
(In response to this post by WBGV)
2y
1. No reason for the ACC to negotiate a reduction in the exit fee. Each school signed the deal, so pay up. That $240M in exit fees will go to the remaining schools, and it's doubtful a majority of them are going to be nice and turn down a check for $20M.
2. Yes, the ACC will still own the rights of those schools unless they buy them back, and there is no way in hell Disney is going to pay an extra $80M a year to have those 2 schools play in the SEC when they can make sure they stay in the ACC at their current contract price.
3. Yes, they could buy out those rights, but CU and FSU are not exactly wealthy schools. They don't have the fundraising capability of a ND, UVA, UNC or Duke. Right now, both schools endowments are at or below $900M each, to buy out of the ACC right now will cost each school about $500M, not going to happen.
4. If FSU and CU were able to leave, and ESPN cut the payout, then FSU and CU would also be liable for the reduction in the ACC tv contract, making their buyout even larger.
5. CU and FSU CAN leave the conference after giving notice, and that is true. If FSU gave notice today they were leaving next year, the ACC members would tell them good luck in your future endeavors. But, FSU would not be getting any money from any TV deal because those rights would still belong to the ACC, and neither Fox nor ESPN would pay extra for any games played at their contracted conferences.
(In response to this post by WBGV)
2y
Item 4. If the exit fee represents liquidated damages, FSU would be in the clear for any further losses after they depart. That's the whole idea of the exit fee, I think.
I think almost everyone on this board misunderstands the urgency that is driving FSU. They are not just trying to call attention to themselves; they are actually in a panic about the future of their athletic department.
(In response to this post by mrcaniac)
2y
Even if the top 2-4 teams leave, the acc leftovers would be comparable to the big 12 with a zillion times better academics. The money would be better or close enough in the leftovers acc at that point.
(In response to this post by WBGV)
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WBGV
2y
It won’t be any different than the PAC-12. ESPN along with the ACC and a possible arbiter will decide what the media rights value of the ACC will be without FSU, Clemson, ND, North Carolina, NCST, Virginia or VT or Miami or any combination thereof. If you think without these schools the media rights deal will still have significant value in this market then that is a fair argument. I just question whether it will or not.
I think Stanford and Cal found out the hard way that academic reputations are of little value to TV Networks and other conferences.
(In response to this post by SpeakToDamien)
2y
difference for those which want to get out of conference.
(In response to this post by WBGV)
2y
#1, that contract should still be comparable to the Big12
#2, especially so if you get 4 exit fees of close to half a billion.
#3, you keep forgetting about the GOR. not going anywhere.
#4, academics matter to the acc schools
(In response to this post by WBGV)
2y
Roughly a check for $45M to each remaining school for the exit fee, and then a check for $145M to each school for the GOR buyout. So, $190M to each.
Think of the exit fee and GOR fee as alimony, the other schools will be made whole by the spouse leaving.
(In response to this post by SpeakToDamien)
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2hhoop3
2y
the article you reference is from 2011 and likely bears little to no relevance to an agreement that has been renewed and renegotiated at least twice since then with the accompanying GORs?
(In response to this post by WBGV)
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WBGV
2y
this contract was renegotiated in 2012 ($3.6 billion over 15 years) and again in 2016 (to add the ACCN and extend the GOR until 2036). The composition clause is still there and is likely in all of the media rights contracts.
(In response to this post by 2hhoop3)
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2hhoop3
2y
it is still there nor do you have any idea how it may have been modified in regards to the newly executed GORs that WERE NOT part of the original. As usual you're just trolling.
(In response to this post by WBGV)
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WBGV
2y
And as usual, you are just name calling with one of your so called “postings of value”.
(In response to this post by 2hhoop3)
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2hhoop3
2y
in the post if you had bothered to read. As usual, you are just trolling, adding no value and then feigning indignation when called on your post.
(In response to this post by WBGV)
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WBGV
2y
that the original media rights contract had a composition clause in it and there would be no reason to remove it when the contracts were renegotiated. There is no logical reason not to have a composition clause because conference are constantly changing membership.
Now if you want to try and explain why any media rights contract would fail to have a “composition clause” in it then you would be at least saying something. It wouldn’t be a very intelligent thing to say, but it would be better than the name calling.
(In response to this post by 2hhoop3)
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2hhoop3
2y
or more importantly think. The point was that with the GORs, the addition of the network, the term of the renegotiated agreements AND the already included periodic lookins the necessity for a composition clause may have been eliminated or substantially modified from the original reference in the article you linked. As far as intelligent things to say goes our posting histories can speak for themselves.
(In response to this post by WBGV)
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WBGV
2y
is a necessary feature of any media rights contract. You are claiming that it may have been removed or replaced with the periodic lookin clause that really has nothing to do with the conference’s composition. You are just wildly speculating about things that make little sense and throwing insults along the way. I will agree with you that your recent postings do speak for themselves.
I would love to see a link about how the lookin clause in the ACC contract replaced the composition clause, but I doubt one will be provided. We know that the original ACC contract had a composition clause and that it was used when Pitt & Syracuse joined the ACC to renegotiate the amount and extend the contract. We know that this contract was again renegotiated to include the ACCN and extend the contract again to 2036. So why would the “composition clause” be removed - did ESPN & the ACC think that the 14-1/2 members were set in stone for eternity and would never change? Really? Should the conference be paid the same amount regardless of how many schools are members? Really? Without FSU & Clemson in the ACC is the media rights value the same to ESPN? Really?
(In response to this post by 2hhoop3)
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2hhoop3
2y
the reason the composition clause may have been modified or removed altogether is that the clause would have been unnecessary or redundant in light of the new provisions associated with the network, the GOR, lookins, etc..
All a composition clause does in reality is provide a renegotiation opportunity which is the exact same thing as a contract lookin provision. With 5 years between lookins, teams tied by GORs and the actual timetable for entry or exit the recomposition could have reasonably been expected to be covered in a lookin. Your last questions show how little you really understand about the GOR as in its design the GOR ensures that contract value at least stays the same should a school leave. The conference was covered with members staying or going through the GOR which is why as of this posting FSU and Clemson are still here.
(In response to this post by WBGV)
2y
we can be sure that any "facts" represented about them here are not facts at all. It is not necessarily true that a composition clause is simply a trigger to renegotiate, just as the look-in might be. A composition clause could sensibly include specific consequences regarding the departure of certain schools. Losing FSU might be felt in a different way then losing Wake Forest.
(In response to this post by 2hhoop3)
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2hhoop3
2y
people here who know people in the AD and/or conference office and have a good understanding from actually reading the document or asking specific questions about the document? The departure of schools including rights, provisions, notices and fees are enumerated in the GOR and other conference documents.
The composition clause was about nothing more than allowing the conference and or ESPN the opportunity to renegotiate should a change in conference makeup warrant it. No doubt losing FSU might be felt differently than Wake, however, financially the GOR impact is no less than the same depending on how the GOR values are calculated.
** Edited by 2hhoop3 at 8/15/2023, 7:16:51 PM
(In response to this post by 33laszlo99)
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2hhoop3
2y
but, I know others with far more and far more direct. Everything I have shared with you and the mountaineer troll comes from my knowledge and/or direct inquiries.
(In response to this post by 33laszlo99)
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WBGV
2y
what state I live in, what schools I support, what conferences I follow, and what sports I watch since he is always by my side. “Being at ease with not knowing is crucial for answers to come to you.”
(In response to this post by Big12 guy)
2y
If I had the real dope, I think I would respond with pure bemusement when these "wrong ideas" appear.
(In response to this post by 2hhoop3)
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2hhoop3
2y
I usually respond initially with pure venom. It is usually questions to understand where a poster may get there "ideas and opinions" from with maybe a little bemusement mixed in but, when they repeatedly respond with erroneous info or troll the board with misinformation I respond and continue to respond in kind to wherever they go. I have no problem with people disagreeing with me as long as they disagree with an informed opinion and/or logical and intelligent defense. I think this current thread follows that pattern.
(In response to this post by 33laszlo99)
We can be #1 in the ACC by the time GOR ends
(In response to this post by icelus)
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WBGV
2y
*
** Edited by WBGV at 8/15/2023, 2:48:30 PM
(In response to this post by MrBayAreaHokie)
Every year that passes means every ACC team’s chances of going P2 will
decline. Everyone’s brand declines as the P2 suck up all the oxygen ( and talent). And the landscape could look very different 7 years from now. What if there is a P1 by then, removed from the NCAA? This is what FSU fears more than the current money disparity.
(In response to this post by icelus)
2y
team, will that be good enough? In the new world of pay for play and the recruiting advantages of the Big 2, we will never sniff double digit wins again.
(In response to this post by icelus)
2y
Beamer’s level yet, but is doable.
** Edited by icelus at 8/15/2023, 12:50:14 PM
(In response to this post by VT ChemE 1986)
2y
We and other ACC teams are already losing recruits due to top recruits wanting the ACC or Big. That is going to get progressively worse until the ACC is gone which will happen sooner than 5 years. Clem, FSU, UNC aren't hanging in a non competitive conference 5-7 years. Fox and ESPN arent waiting too long to become dominant or not be dominated by the other. The gor will get broken through a consortium agreeing to dissolve the Acc or a legal challenge. There's too much incentive by too many big players for the NC mafia to hold this hoops conference together which will ultimately mean we may get into P2 on reputation at reduced revenue share as long as we arent completely horrible like we were last year.
(In response to this post by icelus)
2y
and when they excel, the P2 schools come in with NIL money and they are gone.
(In response to this post by HokieKick`nBack)
2y
Invited to the SEC or Big 10. Otherwise, you're not getting enough votes to dissolve the conference.
(In response to this post by HokieKick`nBack)
2y
Will the SEC cede a swath of the Southeast to the Big? If the SEC doesn't react to ACC poaching by the Big then 8 won't be called. If the SEC fights back then clem, unc, ncst, fsu, vt, uva, miami or most of those get invited then deals will be struck to get Ville Pitt or whoever on board.
If only 4 schools go, there will be 4 more who want into the B12 before it fills as that will be better than ACC plus some west coast teams or plus s fla, memphis, smu, navy, uconn or the like.
(In response to this post by wwhokie1)
2y
expires and will therefore void their contracts. The GOR will then have no teeth. What happens then is anyone's guess but VT needs to be firmly "back" within the next 2-3 years IMO.
(In response to this post by icelus)
2
2hhoop3
2y
never say never, the likelihood of ESPN going broke would seem closer to remote than probable. Even with its issues it is still a significant cash generator. It is more likely Disney would look for a strategic partner or buyer long before going belly up was a serious worry. The two most prominently mentioned at present are Black Rock and Apple, both with the balance sheet strength to fortify Disney and/or ESPN against all comers.
(In response to this post by Maroon Unit)
Maroon, I think it has been established that the GOR is between the ACC and
each school. How would ESPN’s demise impact the GOR? The conference owns each school’s media rights.
And I don’t think ESPN will fold. I think they will sell a partial stake in the business or sell outright.
(In response to this post by Maroon Unit)
2y
projections for each school which showed a floor amount. I recall someone posting F$U was looking at a possible litigation tactic calling out the presentation as fraudulent.
** Edited by Maroon Unit at 8/15/2023, 2:46:34 PM
(In response to this post by Femoyer Hokie)
T
Truthahn
2y
(In response to this post by Femoyer Hokie)
2y
Probably in the next 5 years or so. And that could be a bumpy ride. But once ESPN is direct to consumer, we'll see just how much people are willing to spend on sports content.
(In response to this post by Maroon Unit)
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hokieZ71
2y
The absolute premier sports media company in a media age where quite literally the only live media that is consumed by a massive amount of viewers with any regularity is sports?
By the way, ESPN’s fine. What isn’t fine is Comcast and DirecTV and Dish Network, who are losing subscribers at an ever increasing rate (lowest subscriber base since 1992 I think?) but having to raise their rates because they can’t drop ESPN or negotiate a lower carriage fee for ESPN because ESPN is literally the lifeblood for the subscriber base that they retain.
All ESPN is doing is locking down the properties they have while trimming their own fat and preparing for a streaming market. Disney just owns them at a time when it’s also trying to do the same with Disney+ AND Hulu, and inflation and this initial wave of cord cutting is making the costs and lack of profit associated with a transitionary phase for all three simultaneously somewhat unsustainable.
** Edited by hokieZ71 at 8/15/2023, 7:40:40 AM
(In response to this post by Maroon Unit)
2y
because it offered the ESPN portfolio plus SECN, ACCN, B10N. We also subscribe to Disney+/HULU/ESPN+ but get that subscription included through our mobile phone provider.
(In response to this post by hokieZ71)
Disney lost 300,000 domestic subscribers last quarter...
and laid off 7,000 employees. Disney+ streaming increased 25% this month to try to make up for all those lost subscribers and lost advertisers. I just can't see ESPN continuing to spend the money the're spending on their regular channels, SEC Network and ACCN. Eventually, all this big money for P-4 conferences will likely hit a ceiling and we may see actual decreases in payouts in the future. The money will still be good but I doubt it will be what they are projecting now. I say this because more and more folks are streaming each year. Some may decide to find streaming providers who don't carry sports or at least don't carry SECN, BTN and ACCN. I expect that ESPN and Fox will continue to raise their prices to the consumers so they can keep the P-2 (P-4) conferences happy. The question is, how much will consumers pay for the SECN, BTN and ACCN before they say enough is enough. There are a lot of complaints about Disney+'s recent rate increase. It's increased 75% in the past 3 years. ESPN is a big chunk of streaming costs.
(In response to this post by hokieZ71)
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hokieZ71
2y
Forget the Disney angle. Disney is focused on making Disney+ and Hulu profitable and doesn’t have time for ESPN. And I mean, 300k subscribers is a fifth of a percent of Disney’s subscriber base. So they raise fees $3 a month and basically keep their subscriber rate steady? At 150M subscribers that’s a half billion extra per month in revenue. Win!
By the way, you know one reason Disney+ has been losing subscribers very recently? They lost the rights to the Indian Premier Cricket League. Honestly, they lost 2.4M subscribers for that. Hugely popular in India. (Massive market size over there btw…). Live sports is massively important….
Anyway, the same way the SEC and B1G are fighting for powerful brands to add to their conference lineup, ESPN and Fox are fighting for the best sports content to keep them as market leaders as cord cutting makes this shift to streaming a necessity. ESPN has to have something that people will pay to watch. This is why ESPN isn’t paying the Pac12 $300M a year for a single late night slot of west coast content. They are removing that from their books and shifting it to the SEC.
This is also why ESPN is probably super hot for the ACC to add Stanford and Cal to get a handful of late night content back on their schedule at a minimum of money. FSU, Clemson and UNC have basically said “No, you need to show us the money if you want that”. The Stanford/Cal thing isn’t over for this reason. FSU still wants money more than anything. If ESPN greases FSU and UNC’s palms enough, this will happen.
In the process of buying up the SEC, ESPN got outbid for the B1G by Fox, (who also overpaid for the B1G) but this also means that ESPN’s money is now primarily focused on the SEC and ACC instead of those two + B1G and Pac12 as well. So they are getting leaner and more focused but buying a large amount of content and locking it in. It takes a big investment to do that.
(In response to this post by Old Line Hokie)
I hope there comes a day when customers can pick and choose what they want
I've been supporting Disney for 30 years and I have never watched one second of their channels. Many feel the same way about ESPN. A lot of folks have been paying for ESPN for decades and they never watch it. As for ESPN, I only watch it when Tech is on. The ACCN is a poor quality production IMHO. Most of the hosts are boring and the content isn't that great. Example, Virginia Tech Day last week had re-runs of the Wofford and BC games. I think they had priority because they were the home games Tech won last season but they were definitely ratings bombs. I'd rather had the ACCN show a few classic Tech games than those bore fests. Mark Packer was better when he was teamed with Wes Durham. The ACCN Road Trip to Tech last week was almost unwatchable. I will say that I did enjoy a few of the documentaries (Beamer, Bowden, ACC Tournament,...). I agree with EDGEMAN that the ACCN production quality is poor. I wonder what kind of ratings the ACCN is getting.
(In response to this post by hokieZ71)
E
EDGEMAN
2y
They seem to be barely putting in enough to keep it operational, but they are reaping a nice profit from it.
(In response to this post by Old Line Hokie)
2y
the situation very well. The only thing I will add is no conference will just sit back and allow ESPN to cut contracted payouts without litigation. It is coming. Mark it down.
** Edited by Maroon Unit at 8/15/2023, 8:31:08 AM
(In response to this post by Old Line Hokie)
2y
they are responsible for a good portion of this $3 Billion profit.
Link:
click
(In response to this post by Maroon Unit)
2y
Peak revenue of four billion dollars in 2022. That’s twice the revenue of CNN. The NFL network has revenue of 975 million. The other sports media properties are minuscule by comparison. CBS Sports has revenue of 74 million. Ray I’m sports has revenue of nine million. The competition is NBC and Fox Sports, but both are playing catch-up.
The question. Is what if anything Disney would do with ESPN. It’s highly unlikely they sell it, instead cutting the fat and making the migration from fully cable to increasing streaming options.
(In response to this post by hokieZ71)
I think they make it streaming with commercials
(all the streaming services are going that way) because the economics are better. It gets a premium price vs. Netflix etc. and they cut a lot of costs of high priced talking heads geared to the 24hr cable world that no longer applies. They will be fine. Also I would watch out for NBC. They have a toe in with ND and part of the B1G but Peacock is very good for sports. I just subscribed and really like it. NBC is part of Comcast and they are doing just fine. Cord cutting is not the horror many think it is. They cut pay TV, they dont cut internet and that is where the margins are.
(In response to this post by Hokie1992)