Why would ESPN exercise their extension option on the ACC TV deal as-is?
Been thinking about this, and I don't think ESPN has any reason to do so. The caveat here is I'm assuming that there is no punitive breakup fee payable by ESPN if they don't exercise. If they can get away free and clear after 2026-27, why exercise the option at the current rate?
FSU is almost assuredly gone, whether that's in two years or five years or ten years is anyone's guess, but I think it's *very* likely they're gone by 2030 or so; i.e., not even halfway through the extension term. And they're likely bringing at least one other ACC school with them. If that happens, suddenly the ACC TV deal isn't such a bargain for ESPN anymore. I'd argue the conference would then be on par with the Big 12, but earning significantly more through the duration of the new Big 12 contract that ends in 2031.
ESPN would then know they could kneecap the ACC by not exercising the option, so why not go back to the negotiating table and bargain for lower payouts in exchange for triggering the option? The ACC's other option is to do what, exactly? Go on the open market? We all saw how well that worked for the Pac-12. What other suitors would the ACC have? Not many, if any at all that would be viable.
6 Replies
2y
the SEC, then it's my contention that they will make the ACC a deal they can not refuse. This thing is precarious, and could break in a number of ways.
No one thinks the ACC will remain as it is now, and it appears that ESPN has all of the leverage here. College football needs at least 4 power conferences, but it seems that no one cares about college football - they care about making money. The biggest problem the ACC has, is that they have properties and markets that both P2 conference covet.
If they do not extend the contract as is, and rips it up - then the GOR is out the window, for all of the properties in the ACC. The question then becomes how many of the coveted properties leave to go to the P2. If it's 2-4, then the ACC will be offered a contract close to the B12's (more or less), and the ACC will remain intact with a couple of back fills. This would be the best case scenario for the ACC. Remember, that the B12 only gets $20M a year from ESPN. Fox covets the basketball content, and they stepped up for the other 1/3 of the contract, brining the total to a "reported" $31M.
If the ACC remains a "power" conference, and they keep conference champions in the playoffs, Then you will be in a similar place as the new B12 is now. It also opens the door for one of the current mid level ACC teams to step up, and become a perineal playoff team in the future - just like the schools in the B12.
The pathway for VT to the playoffs would become easier, and like the institutions in the B12, someone will find the support and money to compete for those playoff spots - and while many blue bloods are watching from home, make a run deep into the playoffs, and maybe win one from time to time. Clemson did it, why can't a VT do it as well? Some one will step up in the new B12, and be a contender year after year - but we just don't know who yet. It actually makes for very competitive football, and the games are fun to watch.
(In response to this post by SMU Pony)
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HOO86
2y
They won't be trying to end it after 10 years. The ACC is ESPN's only avenue into eastern college basketball that I know of. FOX is there with the B1G and Big East. ESPN needs the ACC to be there. It doesn't have the value of football, but it has value and ESPN needs to be part of it.
We've talked quite a bit here on the board about where basketball is going from funding.
(In response to this post by SMU Pony)
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HokieZig
2y
That deal was great in the past but not currently. When you are dealing with ESPN, its not whether its a good deal, its whether they can get a better deal. If ESPN does not renew, they know, that the ACC new deal will be less then the current one. The ACC brought in 3 schools that remember ESPN or Fox did not want when the Big12 was looking to expand. Of course he ACC leadership and media (who by the way both have not been very honest) says they add the west coast market and timeslots but go look at how the Big12 turned those schools down. It wasn't even a maybe, it was a hell no. Now ESPN has to pay for those 3 schools for the next 10 years? Put the ACC TV deal back on the market in 2025 and it doesn't get the money they are paying now. On top of that, FSU made up 20 to 25 of the revenue. FSU is 99.9% gone in next 2 years. So we expect ESPN to pay 20% more for the 3 schools that bring nothing to the table except crappy games in the 10 pm EST time slot. Then also losing the top school and loose 20% of the revenue when FSU brings in. That turns into a good deal to a horrible deal in the next year. That's not even adding into the fact that the ACC may lose Clemson and or UNC. Without either of those 2, it becomes even worst. The sooner the acc leadership and fanbase comes to reality that ESPN will not renew the contract the better off the ACC will be. For the last 25 years, the ACC has been stuck in a reactive mode instead of a proactive mode. And now we are seeing the death of the ACC.
(In response to this post by HOO86)
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daveinop
2y
presence of 2024 ACC in largest TV markets is actually quite good...7 of top 10; 12 of top 25...way ahead of pre-breakup PAC
** Edited by daveinop at 2/17/2024, 8:09:54 AM
** Edited by daveinop at 2/17/2024, 8:18:16 AM
(In response to this post by SMU Pony)
2y
(1) "big markets" dont matter - i.e. Boston, NY, etc. when it comes to college football. Content is king - always has been and always will be. (2) the ACC let academics get in the way of smart business
(In response to this post by daveinop)
2y
Agreement. As such, why would they not continue it? My opinion is that these schools are worth more on the open market.
(In response to this post by SMU Pony)