Signs that there will not be a SEC Network?

Madison Hawk

Madison Hawk

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Florida signed a huge deal with Fox sports for media rights such as local TV, replays, broadband and radio. The article below from the Orlando Business Journal and Sports Business Journal is co-authored by John Ourand, one of the best in the business and Ourand speculates that this deal means that there will not be a SEC Network. From the article:

___________________________________

"The University of Florida and Fox's Sun Sports have signed a media rights deal that is not only one of the most lucrative in the country, but also could end the likelihood of an SEC channel being created any time soon.

* * *
The SEC is set to announce its new television contracts in August, industry sources say. By all accounts, CBS will retain the broadcast portion and ESPN will retain the cable portion, with ESPNU and ESPN360 also getting rights that were previously reserved for syndication partners.

The new TV agreements are expected to double the SEC's revenue from its previous contracts, another reason why the conference is not expected to pursue its own network.

The deal between Florida and Sun Sports "could be an indicator that an SEC network is no longer in play," said one TV analyst, who asked not to be identified. "The timing certainly is interesting, isn't it?"

The SEC has the ultimate authority over the local rights of the schools, so it could conceivably commandeer those rights if it decided to launch a network. But the schools that already enjoy significant revenue from their local TV arrangements -- Florida, Tennessee, Kentucky and LSU -- might be hard-pressed to see the value in a conference network.

Those local TV packages typically include tape-delayed or pay-per-view football games, as well as less-attractive nonconference basketball games.

Some TV analysts believe that schools with their own local TV packages should resist the creation of a network that would take over ownership of those rights.
If the SEC decided to move forward with a network, it still could claim the Gators' local TV rights, but it's not likely that Florida, Sun Sports and IMG College would finalize such a landmark deal if it might require changes in a month."


UF, Sun Sports ink 10-year $100M deal - Orlando Business Journal:
 
Madison Hawk

Madison Hawk

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Maybe the talks of an SEC network were to get a better contract offer from the CBS/ ESPN group ????

Jimbo

Very possible, but the SEC could be leaving a lot of money on the table. The SEC reportedly has makes $63 million annually from its television deals. The Orlando Business Journal articles indicates that this amount will double so let's say the SEC will make $125 million from CBS/ESPN/Raycom, or $10.4 million per school. It is a very nice figure but not anywhere close to the top conference.

Although it is hard to get an exact number the Big Ten's television contracts as they are guarded as state secrets, numerous sources place the ABC/ESPN deal at $100 million annually and the BTN deal at $70 million annually. This is $170 million total or $15.4 million per school (CBS's basketball deal is not included but I have heard that the Big Ten only receives a nominal amount of money but stays with it for the exposure such as the prime slot before the NCAA tourney selection).

Even if the above numbers are not 100% accurate, a $5 million television gap is a huge difference to overcome. Also, given the success of the Big Ten Network (likely to be available in 70 million homes by September) compared to ESPNU (much smaller distribution) and ESPN360, I am surprised if the SEC does decide to not start its own network, but that does appear to be a possibility.
 
Jimbo

Jimbo

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Very possible, but the SEC could be leaving a lot of money on the table. The SEC reportedly has makes $63 million annually from its television deals. The Orlando Business Journal articles indicates that this amount will double so let's say the SEC will make $125 million from CBS/ESPN/Raycom, or $10.4 million per school. It is a very nice figure but not anywhere close to the top conference.

Although it is hard to get an exact number the Big Ten's television contracts as they are guarded as state secrets, numerous sources place the ABC/ESPN deal at $100 million annually and the BTN deal at $70 million annually. This is $170 million total or $15.4 million per school (CBS's basketball deal is not included but I have heard that the Big Ten only receives a nominal amount of money but stays with it for the exposure such as the prime slot before the NCAA tourney selection).

Even if the above numbers are not 100% accurate, a $5 million television gap is a huge difference to overcome. Also, given the success of the Big Ten Network (likely to be available in 70 million homes by September) compared to ESPNU (much smaller distribution) and ESPN360, I am surprised if the SEC does decide to not start its own network, but that does appear to be a possibility.

Or maybe they will do BOTH as the Big Ten has done :up

Jimbo
 
S

SideshowBob

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Very possible, but the SEC could be leaving a lot of money on the table. The SEC reportedly has makes $63 million annually from its television deals. The Orlando Business Journal articles indicates that this amount will double so let's say the SEC will make $125 million from CBS/ESPN/Raycom, or $10.4 million per school. It is a very nice figure but not anywhere close to the top conference.

Although it is hard to get an exact number the Big Ten's television contracts as they are guarded as state secrets, numerous sources place the ABC/ESPN deal at $100 million annually and the BTN deal at $70 million annually. This is $170 million total or $15.4 million per school (CBS's basketball deal is not included but I have heard that the Big Ten only receives a nominal amount of money but stays with it for the exposure such as the prime slot before the NCAA tourney selection).

Even if the above numbers are not 100% accurate, a $5 million television gap is a huge difference to overcome. Also, given the success of the Big Ten Network (likely to be available in 70 million homes by September) compared to ESPNU (much smaller distribution) and ESPN360, I am surprised if the SEC does decide to not start its own network, but that does appear to be a possibility.

But missing from from her analysis is this new deal for Florida. Sure, not all the SEC schools will sign similar deals, but for those who can... that SEC $10.4M plus another $10M from an individual deal, well... that's pretty nice.
 
anders5189

anders5189

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The Big Ten territory is about 20% larger in population than the SEC territory and they have more major media markets than does the SEC (most of which are in Florida). So the Big Ten's TV deals should be larger than the SEC's.

Since Florida is the largest state in the SEC UF is probably better off making their own TV deal instead of supporting an SEC Network which would just benefit schools like Ole Miss and South Carolina.
 
M

mattsarz

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The schools might have realized that existing deals with regional networks like CSS and SportSouth might not have been easily breakable to reclaim those rights.

CSS has replay rights for six SEC schools (S. Carolina, Ole Miss, Miss. St., Georgia, Auburn and Alabama) and SportSouth signed a rights agreement just last year with Tennessee. COX has replay rights with both Alabama and LSU. Kentucky has their Big Blue Sports Network replays as well. Florida = Sun Sports.

These are things the Big Ten schools didn't have to deal with. Take sides with FOX and Comcast isn't likely showing the new network and holds six schools to existing contracts. Side with Comcast and three of the top SEC teams have their replay rights elsewhere.
 
M

mpar1

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Very interesting article. Am I interpreting it correctly when I read "with ESPNU and ESPN360 also getting rights that were previously reserved for syndication partners." Is that a reference to Raycom's games or more along the lines of the local broadcast that appear on GamePlan?
 
M

mattsarz

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A couple articles today have said that this agreement does not interfere with any possible SEC network. I personally disagree.

As for ESPNU and ESPN360, that's how I read it too, but I don't believe they would toss Raycom out in favor of ESPNU and ESPN360.
 
techno935

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Raycom is doing Hi-def this year. Chances are, Raycom will syndicate to the regions of those teams, then ESPN will get that SAME feed for other markets. Obviously those ESPN games will be blacked out in the Raycom markets. I think that's how it works?!? Correct me if I'm wrong.
 
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Madison Hawk

Madison Hawk

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Raycom is doing Hi-def this year. Chances are, Raycom will syndicate to the regions of those teams, then ESPN will get that SAME feed for other markets. Obviously those ESPN games will be blacked out in the Raycom markets. I think that's how it works?!? Correct me if I'm wrong.

Unknown. In 2005, the first year of ESPNU, ESPNU did a simulcast of many of the Big Ten ESPN regional syndication games with no blackout. In 2006, the last year of the old Big Ten agreement with ABC/ESPN, ESPNU had exclusive rights to many games. The possibility of the latter fact was a major reason the BTN was created. The Big Ten did not want to be in a position of having its games leveraged to help the distribution of ESPNU (e.g. Mediacom picked up ESPNU in 2006 after two Iowa games were selected for ESPNU). The Big Ten believed that it could achieve broader distribution with the BTN than ESPNU and keep 51% ownership for itself. The Big Ten's analysis of being able to achieve greater distribution through the BTN rather than ESPNU is proving to be correct.
 

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