Sunday, March 6, 2016

Big 12 Expansion: "The Big 12 Network Presented by Longhorn Sports"

So I saw some tweets from MHver3 that caught my eye.

MHver3 is a West Virginia Mountaineer fan who is a long-time realignment poster.   He claims to have insider connections.  He is reviled by some who firmly call him a liar who paints himself as more plugged in than he actually is....But everyone who follows realignment reads him. 

Even if they think he is full of it, or at least irresponsible in what he posts. (The worst part of being a critic of someone's integrity is having to eat crow when they get it right, so they have to keep reading...)

I read MHver3 as basically very unfiltered content. If people know you will publish what they tell you and they want certain things out for public consumption in order to drive behavior, they will tell you things.  Some of it 100% true. Some of it to drive behavior.  I have experienced it firsthand.

It seems for the most part, if he hears it, he posts it and that keeps the spigot(s?) open. (Some might go as far as to say, "Perhaps regardless of how likely it is to happen?")

He claims that UT has laid down some concessions they want before they will agree to convert the Longhorn Network into the Big 12 Network.  I think that these conditions are worth discussing.

UT DEMANDS

1) They want to have a mixture of current LHN content and new Big 12 content.

2) They want it still called the "Longhorn Network" in Texas.  In Waco, Lubbock and DFW it could be called "The Big 12 Network Presented by Longhorn Sports".

3) They want to retain majority ownership of the network indefinitely.

4) They want the Big 12 teams to buy their way into the network.

5) and they want an annual share that is 25% bigger than the other members'.

...You always ask for a lot more than you think you can get, but a real deal maker knows the value of their hand and doesn't insult the people they are trying to cut a deal with.

If this is really representative of what UT put out there, I cannot imagine OU president David Boren was anything but livid reading the conditions.

Now maybe he calmed down after thinking through the list a bit.  There are things on this list that are totally viable and reasonable requests.

A Big 12 Network needs UT fans to buy in.  That is the entire point of trying to convert the LHN.  Without UT fans, the Big 12 cannot get a network off the ground.

Keeping a lot of LHN shows (or more likely keeping those shows with heavy UT content) just makes sense. And mixing in more Big 12 content will make it a network the majority of UT and Big 12 fans will want. It is win-win with the right balance. #1 is within the realm of reasonable.

Having the Big 12 members "buy in" is a very reasonable demand.  UT is owed money by ESPN.  They should keep that.  Other Big 12 schools should have to buy back their tier 3 rights for the network.  UT owns half of the LHN, UT SHOULD be compensated to convert it.  #4 is ok too.

Having UT make a larger share than other members bugged the hell out of me when I read it the first time (My gut reaction was "Didn't UT's leadership see what happened the last 6 years?!!"), but then I thought about it with no pre-conceptions as a fresh deal.

Right now UT makes what? A guaranteed minimum of $15 Million annually from their tier 3 rights via the LHN?  How much does Tech make on their tier 3 rights?  $1M? $3 M?  How much does TCU?  In this scenario if UT made $12.5 M from their tier 3 rights share from the Big 12 Network, Tech and TCU would make $10 M each.

It isn't equality, but it is a pretty reasonable response when you look at it from that perspective.

There are "Kings" of college athletics and then there are "Kings of Kings" of college athletics

UT is one of  seven "Kings of Kings" along with Notre Dame, USC, Michigan, Penn State, Florida, and Ohio State ---Huge, rich schools with dominant followings, great academics, and elite football tradition.

Remove UT from the Big 12 and only Kansas and Oklahoma would likely be guaranteed a home in the power 5 conferences.  (TCU, West Virginia, and Baylor would still have a shot, but would be no sure thing.)

This is why these schools have made their bed with UT in the first place, right?  This is why these schools have tolerated UT making more on their tier 3 rights.

It begs asking, why should UT NOT get a little more?  Is equality in payouts unsupported "wrong thinking" when applied to a King of Kings?

There are not any more Kings of Kings in play. If UT gets a little more and expansion plays out properly, no other school will have the juice to demand more than their 100%, so in that regard, making that concession would not have further implications.

You have to remember, UT is already equally sharing tier 1 & 2 payouts.  So lets say that in a few years a tier 1&2 payout is $35M and Big 12 Network payout for UT is $12.5M.  UT will make $47.5M from TV.

And Tech, TCU, and every other Big 12 school will make $45M each.

Is that difference worth fighting over?  No, I don't think so.

Would a target school like Florida State balk over that?  I think they would have the same initial anger, but on reflection, I am sure they would look at it like OU has --- "Faced with potentially a losing hand as our other option, we can live with very, very lucrative 'near equity'."

You have to understand that UT Boosters think there is no reason for UT to be a peer to Kansas State. 

To keep the UT Boosters happy, UT has to be in the catbird seat... even if that doesn't truly amount to much. Unless you are planning on kicking out "the conference riff raff" (not currently possible), that very well may be the cost of doing business with UT.

With that in mind, #5 is reasonable.

Then we get to the ones that are really insultingly a step too far.

UT wants to be the majority owner of the network indefinitely.  This reads to be an incredibly shitty, poisonous position.

This may or may not be a reasonable position.

If you think about the motivations behind it, UT probably wants to be able to bolt on the conference and take the network and the best schools with them at some point if the new Big 12 it currently carrying too much dead weight in media terms and the end result conference doesn't financially work out.  And if you think about it, that is a reasonable position. It's their network.

Imagine what a better position the ACC would be in today in terms of survival if FSU, UNC, and Duke could easily pull a MWC and cherry pick the ACC to form a new conference because they jointly owned their own network...

While turning this into a Big 12 Network will allow the conference to survive and be upgraded with better candidates than are available today, there is no question the other schools will profit from this more than UT. 

In some ways UT is having to concede to the benefit of others.

I believe the LHN is jointly owned by UT and ESPN.   I think you could leave ownership of that half of the network in UT's hands as long as it was laid out right.

Lets be clear here.  This is only being considered because OU (and to a lesser degree West Virginia) are pondering leaving if it doesn't happen.

Everyone hopes this conversion will lead to one of the optimal expansion scenarios and that payouts will reach near SEC/Big 10 levels and stability long term will be the result.

Lets say this idealized expansion happens then 15 years from now Baylor, KSU, ISU, and OSU are all terrible with horrible attendance and viewership.

It could make a world of sense for the haves of the conference to have an exit strategy where they can have UT carry them AND THE CONFERENCE NETWORK out Mountain West Conference-style.

Putting all that power in the hands of a school beholden to no one which is perfectly happy to eliminate schools from the mix offers UT Boosters the power fix they need and gives schools like OU and KU plausible deniability down the road if tough decisions are made.

Pair that with a more focused next GOR deal that only requires the haves (UT, KU, OU, WVU,and maybe TCU and/or Tech) to commit their rights and the foundation is laid for such a scenario ---if needed.

Realistically, down the road, you might be talking about splitting 95% of the same pie between 4 fewer mouths.

If the conference at that point is again looking at being picked apart, that kind of flexibility to allow a 19% raise in TV payouts to surviving member schools could save it long term.  (Such a move could turn $45M TV checks into $53M checks. Very much blunting potential encroachment from the Big Ten or SEC.)

It's a reasonable position for "the haves" to embrace and frankly "the have nots" don't have the juice to challenge it.

(And really as long as the have nots stay around .500 most years via smart scheduling, they aren't going anywhere anyway.)

I think you can concede all of UT's ownership if structured properly.  What you cannot concede to UT is ownership in terms of management or profit sharing. 

UT cannot be allowed to call the shots on all kinds of network minutia directly.  The conference needs to call the shots.  UT can still have a very loud voice in the conference, but that needs to be the line.  It needs to be difficult for UT to force changes through the conference in order for the network to be as effective, independent, and profitable as it can be.

All revenue that is not taken by the Network partners needs to be in the pool the Big 12 splits between their members in nearly equitable terms.

As offensive as #3 reads on paper, in the right scenario, it could be a real positive in landing other haves like FSU, Clemson, Miami, and BYU, by suggesting that if schools do not carry their weight they can be exorcised down the road, offering an added level of protection for the whole.  Slightly restructured, it could be reasonable.

Now the most offensive one is that the Big 12 Network would continue to be called the "Longhorn Network" in Texas.

This is to some degree understandable if you view this as an effort to protect their branding in case this doesn't work out --- as just another part of an escape plan if things don't work out.

But I doubt Boosters in Waco, Lubbock, or Fort Worth see that.

I think UT should let this one go.  And usually when you are laying out demands, you include a couple you might concede to get the ones you don't want to concede.

This one doesn't really even make sense for UT.  You have to present the look of teamwork and peer status for the raids of schools like FSU and Clemson (or Arizona State and Colorado) to be viable in a scenario where UNC and Duke want to stay in the ACC.

The LHN has come to be synonymous with the idea that UT is a spoiled brat of a conference mate.

The LHN argument is an embarrassment to a lot of UT alums, even if they like having more UT content.  It's time to let it go.

It's funny, taken in the harshest context terms like these seem poisonous, but if you can get to the heart of them with an equitable mindset, a lot of these could be reasonable.

Here's hoping the schools can work a deal.

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