Big Ten expansion talk makes sense - it'll eventually make plenty of dollars, too
First it was Notre Dame, then Texas, then came the plan to annex the East.
Since the Big Ten announced in December the timing was right to “conduct a thorough evaluation of” expansion, the conference has gone through a dizzying array of prospective incarnations.
Columnists from Kentucky to Nebraska have weighed in on the merits of joining the first BCS superconference, and last week came the sensible plan of growing by five: Missouri, Nebraska, Pitt, Rutgers and Syracuse.
Jim Delany
Big Ten commissioner Jim Delany said the conference is sticking to its original 12- to 18-month timetable for a decision, but the smart money is on movement by the end of the summer.
Conference athletic directors will meet in Chicago later this month, and university presidents have their annual retreat the first weekend of June. Expansion is bound to be a topic of conversation at both gatherings, and unlike years past when the subject came up, the Big Ten looks guaranteed to grow.
While the whos and hows still need sorting through - that five-team plan would be perfect if Notre Dame was a part - the why of expansion is obvious: Money, and lots of it.
Three years after launch, the Big Ten Network is a cash cow that’s made conference schools the envy of their peers. Big Ten schools, Michigan included, hauled in an estimated $22 million in rights fees last year.
SEC teams have won four straight national championships in football, ACC teams have won the last two NCAA titles in basketball, but neither conference keeps its members as flush with cash as the Big Ten.
By adding more schools, the conference guarantees itself and its network (of which it’s a 51-percent stakeholder) deeper revenue streams.
As is, the Big Ten Network rakes in an estimated 88 cents per cable/satellite subscriber in its eight-state footprint (Michigan, Ohio, Illinois, Indiana, Iowa, Minnesota, Pennsylvania, Wisconsin) and six cents a subscriber elsewhere, according to research firm SNL Kagan. Penetrate a new state, New Jersey and its estimated 2.6 million cable households, for instance, and watch the money flow (that’s $2.3 million for the calculatorly impaired).
Beyond subscription fees, the network stands to benefit from more programming (five new teams means three more conference football games a week), increased ad revenue, and a Big Ten championship game. And if the conference could land a school with national appeal like Notre Dame, well, that 88-cent fee might become a bargain.
So what are the chances the Big Ten adds Notre Dame, the big fish it failed to hook a decade ago? Depends who you ask.
Notre Dame athletic director Jack Swarbrick has repeated his school’s desire to remain independent, but the Irish might lose their game of chicken amid collateral damage.
The Big East, of which Notre Dame’s a member in all sports but football, won’t survive if the Big Ten pillages three or four of its members. UConn, Pitt, Syracuse and Rutgers are all on the Big Ten's radar.
If you believe in the superconference model, the fallout doesn’t stop there. The ACC would swallow the Big East’s less desirables, the SEC would expand (hello, Texas?) and the Pac-10 would move into the plains, leaving four 16-team leagues to break away from the NCAA.
The Irish aren’t what they used to be as a football program, but they still hold widespread appeal (as evidenced by their TV deal with NBC). More importantly, they're exactly the type of school the Big Ten needs to make expansion worthwhile. Texas would be even better for its TV markets and fertile recruiting territory, but that's a pipe dream that even a shrewd businessman like Delany will have a hard time pulling off.
Big Ten Network president Mark Silverman said the network’s interests are “one of many factors that go into determining if (the conference) should expand.”
“That’s really all I know,” Silverman said last week. “Unfortunately, there’s a lot more excitement in the speculation than the reality of what’s happened so far.”
That’s true, but the speculation isn’t baseless.
Silverman wouldn’t address specific schools or say what getting into certain markets would mean for his network, and he wouldn’t venture a guess what the conference will look like five years from now.
“Call me back in 12 to 18 months,” he said, "and I’ll let you know.”
Dave Birkett covers University of Michigan football for AnnArbor.com. He can be reached by phone at 734-623-2552 or by e-mail at davidbirkett@annarbor.com. Follow him on Twitter @davebirkett.
Comments
David Briegel
Tue, May 11, 2010 : 11:29 a.m.
Enjoy your 2 games a year against the MAC and Conn or Mass or App St or Slippery Rock for your "premium pricing". Plus losing half your traditional Big 10 rivalry games. Mich used to play Nebraska, Missouri, Colorado, Pac 10, Fla St, Miami. You wouldn't mind premium pricing for great games like those. Terry, they have already extended the invites! Sad.
MR. Language Person
Mon, May 10, 2010 : 7:27 p.m.
@Rudejude: Several things: 1: an equal share of a much bigger pie is much better than a lage share of a small one. Texas stand to gain several million dollars of tv revenue by switching. It would be silly for them to stay just because they control revenue when it can't earn them as much. 2: I do think your idea is crazy. Travel costs and times would be ridiculous, especially for non-revenue/Olympic sports. If this were truly a coalition of independents and not a conference, what would happen to these sports? Beyond that, the Big Ten and ACC are much more than athletic conferences. The amount of research done is well into the billions. That's not something from which member schools will walk away readily for one sport.
james Kurtz
Mon, May 10, 2010 : 4:03 p.m.
Texas and Notre Dame were never in the picture and would not be welcome. We don't need fisheaters and longhorns messing up the fields.
MR. Language Person
Mon, May 10, 2010 : 1:32 p.m.
@Rudejude: Several things: 1: an equal share of a much bigger pie is much better than a lage share of a small one. Texas stand to gain several million dollars of tv revenue by switching. It would be silly for them to stay just because they control revenue when it can't earn them as much. 2: I do think your idea is crazy. Travel costs and times would be ridiculous, especially for non-revenue/Olympic sports. If this were truly a coalition of independents and not a conference, what would happen to these sports? Beyond that, the Big Ten and ACC are much more than athletic conferences. The amount of research done is well into the billions. That's not something from which member schools will walk away readily for one sport.
Terry Star21
Mon, May 10, 2010 : 1:27 p.m.
@ David Briegel. You bring up a good point that has not really been touched on that much is these forever seeming expansion talks. Right know with eleven teams, we miss playing two teams for a two year period - which I ever liked. Adding five teams for sixteen would eliminate a full seven teams from playing the UM in a year period - there is no fairness in that for teams, and especially their beloved fans. We could add two weeks to the season and two more of those teams - but that is all moot, with 16 teams because there would be a playoff against the 2 or 4 divisions of the Big 10, however they structure it. The chances are zero-to-none that a 12th team will not be added, I have excepted that. The university administrators need to really thik about their school, the students, and us great fans before even considering adding five teams. In a perfect world, the administrators could make that decision before September 1, and let us enjoy Big Ten Football - and no more expansion talk.
Dave Birkett
Mon, May 10, 2010 : 1:11 p.m.
Cutter, the $22 million I referenced is total TV rights fees hauled in by each Big Ten school last year. That's an approximate number and while ESPN and ABC surely foot their share of the bill, the Big Ten Network is a large part of the reason we're having this discussion today. The Network is a bigger revenue generator than the conference figured it would be at this time, and it's why the conference is the envy of so many schools and the center of expansion talks. Braggs, I don't know if Pitt's a slam dunk. It's got good academics and good programs and should make the cut, but if this is mainly about TV, the school doesn't offer new markets. Add Syracuse, Rutgers, UConn, Notre Dame and Missouri and you'd get access to the East, St. Louis and the nation with ND. Not saying Pitt won't get in, just it's no guarantee. I wouldn't be surprised if we saw a tiered expansion, say Rutgers, Syracuse, Pitt coming aboard, the Big East dissolving as we know it, and Notre Dame and UConn joining in Phase 2. Let's be honest, the only school that matters is Notre Dame because of the TV opportunities it opens up. And CR, as for schools breaking away from the NCAA, this has been speculated about for as long as I can remember and isn't really new to this round of expansion. Essentially, the NCAA is by and of the schools. The theory goes that since its a few schools making a lot of money, why cut so many others in on the profit? There's what, 120 football-playing schools and 340ish basketball-playing ones. Why not get rid of those who bring the least to the table? To be clear, I don't think this will ever happen. It's presidents that would make that call at the end of the day and I just don't see that happening.
Michigan_Jayhawk
Mon, May 10, 2010 : 10:17 a.m.
To mgobluegold: What are you drinking? What eve it is, pass it around!
RudeJude
Mon, May 10, 2010 : 9:09 a.m.
It is doubtful Texas will join the SEC. As much as it makes sense geographically, Texas rules the roost that is the Big XII and has nothing to gain and much to lose by joining the SEC or any other conference. Texas maintains dominating administrative sway over the Big XII, garnering the school a predominate slice of the television profits (unlike the Big Ten where a profit-sharing policy guarantees each member school an equal slice). In fact, Texas' command over the conference is one of primary reasons Nebraska is considering leaving for the Big Ten. If Texas joined the SEC, they would relinquish this power and, instead, vie for control as a conference newcomer against the likes of Alabama, Florida, LSU and Georgia. Factoring in a SEC schedule that would be more punishing relative to their current Big XII schedule, one where the school would be more likely to lose, and a situation arises where Texas loses conference control and loses games on the field. It does not make sense. If Nebraska and Missouri leave for the Big Ten and Colorado leaves for the Pac-10, as some reports have suggested, I believe Texas will work to keep the Big XII afloat, solely to maintain its control over a BCS-conference. Should the Big XII collapses, Texas would first either consider joining the Pac-10 or attempt to restructure a new conference. My "crazy" out-of-the-box idea: Assuming the Big Ten expands to 16, and the SEC, ACC and Pac-10 follow suit. Notre Dame and Texas confederate to create the "Independent Conference," a loose alliance of elite, nationally-prominate schools that maintain national schedules and do not necessarily play one another. Assuming they work together, Texas and Notre Dame's television revenue would be massive, and could sway other nationally-prominate teams to abandon their conferences to join this elite, fiscally-lucrative group. I could see Texas bringing Oklahoma solely to bring another big name school into the mix. I think a school like Miami has a certain national-flare and would be willing to leave the ACC. Maybe Tennessee is tired of losing in the SEC? I could see a rising team like Oregon (Nike College if you will) jumping at this prospect, and wouldn't say it would be impossible for a team like USC to jump ship and join this list of elite names. Imagine, Texas, Oklahoma, Notre Dame, Miami, Tennessee, Oregon and USC, or some combination of these teams, all claiming their independence and simultaneously creating a television network with one another, one with few members but consisting of must-see teams. Their profit sharing would be through the roof. They would be able to maintain national schedules, which would be great for recruiting, and schedule whoever they please whenever they please. The super conferences could still exist, albeit with a few filler teams as replacements, and would be willing to schedule games against the new independence, as the money would be too good. Call me crazy, but this, or some variation, is not as far-fetched as it sounds. What do you think?
David Briegel
Mon, May 10, 2010 : 1:29 a.m.
How sad. Leaders and Best? Just like the rest! You will miss the rivalry games with Iowa, Minn, Wis, NW, Ill, Ind, Purdue and even MSU! I would prefer a 12 team round robin. How can you claim a championship without playing half the teams? Money Grubbing for tv $ is hardly a "value" for which to strive!
mgobluegold
Sun, May 9, 2010 : 9:18 p.m.
I agree with Jaxon5... all this discussion won't make Michigan win a game. September 4, 2010 however, will make Coach Rodriguez and the Michigam Wolverines run off 13 straight victories (26 if you count 2011 also) and dance with a lady named BC Crystal.
Terry Star21
Sun, May 9, 2010 : 9:11 p.m.
'Call me back in 12-16 months'..'I'll let you know' - Silverman, 'Wake me up in 12-16 months, when all this talk is over' - Terry Star man.
FlintMaize
Sun, May 9, 2010 : 7:14 p.m.
Rutgers brings the whole state of New Jesey via cable to the Big Ten Network and potentially some cable systems in New York. Athletically, not very good in basketball but decent in football, however, Rutgers inclusion is all about cable viewers. Nothing more, nothing less. From this standpoint, Rutgers brings plenty!!!
Jaxon5
Sun, May 9, 2010 : 7:01 p.m.
Will any of this discussion help UM football win a game this fall?
cutter
Sun, May 9, 2010 : 4:33 p.m.
According to research done by a television executive posting on Frank the Tank's blog pertaining to Big Ten expansion, Rutgers is estimated to add $67.8 million in additional revenue to the Big Ten Network. If NYC is included, total new households for the BTN would be 7.49 million with over 3 million located in New Jersey. Rutgers is an AAU member with a research budget of $323 million. That budget puts them above only one school in the Big Ten (Iowa). In terms of research budgets, Texas is first, followed by Pittsburgh, Maryland and Nebraska. RU is fifth on that list of potential expansion candidates. For more information, I suggest you check out this link: http://frankthetank.wordpress.com/
BlueMom
Sun, May 9, 2010 : 3:04 p.m.
Expansion only makes sense if the ACADEMIC integrity of the Big 10 is preserved. Both Nebraska and Missouri are ranked significantly lower than the lowest Big 10 school. The AD at Nebraska stated that he is concerned about joining the Big 10 because the recruiting rules are different and he is concerned about getting the type of players Nebraska needs.
bmaloy
Sun, May 9, 2010 : 1:46 p.m.
I'm with you 100% Portage. I'm thinking that if the Big Ten goes through with a 5 team expansion, they will be a "placeholder" in-case ND wants to join.
PortageLkBlu
Sun, May 9, 2010 : 1:35 p.m.
bmaloy, it's a joke, Rutgers brings no value to the table but it would be a value to Rutgers, exposure and financially to be allowed into the Big 10 conference, comprende?
bmaloy
Sun, May 9, 2010 : 12:02 p.m.
"Anyone knows the value Rutgers brings to the table is the value to Rutgers." PortageLKBLU, come again????
mcflies
Sun, May 9, 2010 : 11:21 a.m.
So what if ND decides at the last second they want in? Who's out? Seems like 5 team expansion is in the cards here with Nebraska, Mizzou, Cuse, Pitt, and Rutgers. Nebraska, Pitt, and ND would make this conference ridiculous. Cuse isn't too bad at basketball either. Rutgers doesn't offer anything as far as competition. What does ND think it is doing anyway - the Big East is going to fall, its going to happen, why are they playing this wait and see approach when everyone already knows its inevitable?
PortageLkBlu
Sun, May 9, 2010 : 10:23 a.m.
bmaloy, my goodness what do you mean,"what value does Rutgers bring to the table?" Anyone knows the value Rutgers brings to the table is the value to Rutgers.
cutter
Sun, May 9, 2010 : 9:41 a.m.
For Dave: In your story, you infer that each of the Big Ten programs received $22 million in rights fees through the Big Ten Network (BTN). You might want to clarify those numbers. The BTN provided $60 million in rights fees to the eleven members in the conference plus an additional $66 million through its profits. That total of $126 million comes out to $11.45 million per school. The remaining television-related revenue comes from the conference's contracts with ABC/ESPN and CBS. An article from Sports Business Daily dated 3 March 2008 states that each team in the conference receives $9.27 million through these contracts. Adding these two numbers comes up with $20.72 million. The 2008 Sports Buiness Daily article also mentions that there are escalator clauses in each of thse contracts. That could explain the difference between the generally understood figure of $22 million and the $20.72 million figure mentioned above. For a link to that article, go to: http://www.sportsbusinessjournal.com/article/58254 Your basic premise is correct-an expansion of the conference could enhance those revenue streams and increase the funds allocated to each of the athletic programs, even if there are more members in the Big Ten-plus. Its fairly obvious why many programs would find that attractive. The ACC pays each of its members approximately $5 million thru its television contracts. The Big East and Big XII members get between $8 and $10 million per year. Given the fact that the vast majority of athletic departments are not-self sustaining, its not hard to imagine why joining the conference would be attractive to a number of schools.
bmaloy
Sun, May 9, 2010 : 9:37 a.m.
What value does Rutgers bring to the table?
azwolverine
Sun, May 9, 2010 : 8:43 a.m.
Not excited about expanding to 14 or 16 teams, or just 4 "super conferences" making up all of college football. As for then seperating from the NCAA, not sure I get that either. I don't want to see college football change so radically that it becomes unreconizable to what it currently is because, despite it's flaws, I love college football more than any other sport. College football is rivalries, not only in its' teams, which these superconferences would water down, but also in its' regions and conferences. Let's add one team and call it a day.
FlintMaize
Sun, May 9, 2010 : 8:30 a.m.
My uneducated guess and view, has the top three schools that may be coming in as Missouri, Nebraska, and Rutgers. I think Pitt only gets in if we add "5" teams.
CR
Sun, May 9, 2010 : 8 a.m.
AAN Dave: Please explain the "leagues to break away from the NCAA". I have read this statement a few times but do not understand how colleges can break away from the governing association.
PortageLkBlu
Sun, May 9, 2010 : 7:25 a.m.
Just picture it, a beautiful Autumn day, the leaves are that magnificent color, as you approach the stadium you can hear the crowd noises and oh my goodness smell that wonderful variety of meats and veges being cooked over charcoal. As you approach the refurbished stadium the actual colossal size of the stadium never fails to amaze you and what visiting league team is on Michigan's menu why Big Red, (Nebraska) man oh man a day to remember.
braggslaw
Sun, May 9, 2010 : 6:16 a.m.
From the outside it apears that Missouri and Pitt are "in" If the number is 14, only one slot remains. Will it be ND, Rutgers, Nebraska etc.?