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Pac-12 Conference, Not Big 12 Conference, Remains Most Vulnerable

NCAA Football: Pac-12 Championship-Southern California vs Stanford

For the past several years, since the last batch of conference realignment, it was widely assumed that the Big 12 Conference was, by far, the most likely conference to disintegrate in the next round of shake ups. But over the past 12-18 months, the narrative has started to change. And it’s now more clear than ever that it is the Pac-12 Conference, not the Big 12 Conference, that is most likely to find itself in peril in a few short years.

The latest example of this is the Pac-12 Conference announcing its revenues and distribution numbers. For the first time the Pac-12’s annual revenue topped $500 million.

 
In a statement, the conference said:

“For the four-year period since 2012-2013 when the Pac-12 began its media rights agreements with ESPN & Fox and launched the first and only member-owned conference network, annual member distributions have increased by 63% ($228M to $371M) and annual total revenues have increased by 53% ($334M to $509M total revenues). The compounded annual growth rate for member distributions and total revenues over the four-year period was 13% and 11%, respectively. The ESPN and Fox deals signed in 2012 resulted in more than four times the annual revenue of the prior Pac-12 media deals.”

Sounds impressive, right?

Well, that’s not telling the whole story.

So far, we have the distribution for three other conferences.

SEC: $41 million
Big Ten: $38 million
Big 12: $34 million

And when it comes to the Big 12, that doesn’t include the Tier 3 media rights (local rights) that add at least $1 million per school, but add $15 million to the bottom line for the Texas Longhorns (The Longhorn Network). Even Kansas State reportedly earns $4+ million from Tier Three rights, with West Virginia up to nearly $6 million.

But as for the Pac-12, the conference owns the Tier Three rights, so that income is included in the reported distribution figure.

Also, when you figure the Pac-12 made $509 in revenues, but distributed $371 million, that’s a wild $138 million in expenses, which includes the fortune of operating the Pac-12 Network. As the Seattle Times points out, the Pac-12 Networks, which show 850 live events annually across seven feeds, is costing the conference a fortune. And it’s distribution has been suspect, at best.

 
So when you look at where the Power 5 conferences rank in terms of stability on and off the field, the idea of the Big 12 trailing the pack is a distant memory. The Conference was the only one of the Power 5 to have a Final Four participant in football (Oklahoma) and basketball (Kansas).

Off the field, the conference is right in the middle of the pack, if not near the top, in terms of the amount of money distributed to each of the universities in the conference. Sure, the Big 12 doesn’t have its own network, which will make it an outlier of the Power 5 once the ACC Network gets off the ground, but I’m not convinced that is a bad thing, or even matters.

As customers continue to alter their viewing habits and “cut the cord”, the way we consume live sports will keep changing drastically in the coming years. The Pac-12 can brag about how many water polo and volleyball games it airs, but does anyone care? Clearly their customer base doesn’t, and DirecTV continues to tell the Network it has no interest in the product, at least not at the price point that is being asked.

As if you needed another example of why the Big 12 Conference is the healthiest it’s been over the past ten years, here you go. Enjoy the ride Big 12 fans, it’s only going to get better from here.

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