One Billion $$$ reasons to expand.

[Rootmaster]

www.cbssports.com/college-football/news/big-12-could-earn-an-additional-1-billion-by-expanding/

How many more months of feet dragging or expensive studies will it take for the Big 12-2=10 Presidents to let this opportunity slip by?

Add four and get 'er done!

 

[michaelwalkerbr]

I read Dodd's article. At least an additional $250 million per added school over the remainder of the contract. Transitioning the newcomers in as WVU and TCU did would create a small windfall for the current members.

 

[Rootmaster]

Truly...how can they possibly walk away from this?

 

[Mountain Man]

If they're going to expand it needs to be from a power 5 conference to even be profitable in the long run. Taking teams like Cinn, Memphis, Houston, directional Florida schools won't increase TV ratings in the long run.

 

[Rootmaster]

Mountain...you apparently didn't listen to the story. It doesn't matter who comes aboard. As far as somebody from another P5 coming....explain to me why they would leave conferences with more money coming in and more stability in membership to join a conference that doesn't even have enough members to match its name? Pipe dream of pipe dreams. WVU is on an island currently and that is not good. Big 12-2=10 needs to expand...yesterday.

 

[GoWVU]

I know you guys are constantly sticky for the topic of expansion and think it solves every problem under the sun, but apparently nobody read the article very closely.

Somebody needs to explain how expansion automatically earns the existing Big 12 schools new money, because the article concedes that it does not.

 

[topdecktiger]

Truly...how can they possibly walk away from this?

Because that money isn't really "extra." That $1 billion (or $500 million) is just what it would take to cover the expense of having 4 (or 2) new teams. This article isn't really saying anything new. All this article really did was give the exact figure of the pro rata increase.

 

[Rootmaster]

"The Big 12 is approximately $9 million per school behind the SEC in annual revenue. Added expansion would close that gap "by half," according to a source."

Read the article again and explain why it is in the Big 12-2=10's interest to stand pat and not expand? And please no more crap about everyone out there being not worthy.

 

[topdecktiger]

"The Big 12 is approximately $9 million per school behind the SEC in annual revenue. Added expansion would close that gap "by half," according to a source."

Read the article again and explain why it is in the Big 12-2=10's interest to stand pat and not expand? And please no more crap about everyone out there being not worthy.

Ok, here's the explanation. The article says:

Big 12 administrators will be presented with information this week at the league's spring meetings that expansion could earn the conference at least an additional $1 billion over the length of its remaining TV rights contract, CBS Sports has learned.

If the league expands by four teams, provisions in its contracts with ESPN and Fox provide money for that benchmark. If the expansion is by two teams, the increase would be $500 million.

Those rightsholders are contractually bound to provide "pro rata" for any new Big 12 members. That is, any new members would be paid an equal share of the current Big 12 members -- approximately $23 million per year.

While on its face that doesn't necessarily help the 10 current members of the Big 12, opening the existing contract would allow for a negotiation beyond that $1 billion figure.

Ok, there it is. For the current 10 schools to see any increase in their payouts, the contract needs to increase beyond the $1 billion figure.

Later, the article says:

When the league signed the 2012 deal, there was conversation regarding language for reopening the contract in the event of expansion. The parties agreed the Big 12 would get equal shares for any new teams that were added.

That means a team from the American Athletic Conference -- most often mentioned as possibilities in Big 12 expansion -- would automatically go from the $3-10 million range to $23 million.

So there it is again. The payouts are going to still be around $23 million, which is what they are now. You can do some simple math to get a good estimate. Each new team is going to get around $23 million per year. Multiply that by 4 teams, and you get $92 million for one year. Multiply that by 10 years, and you get $920 million. That pretty well accounts for the $1 billion increase, and that's just from simple ballpark calculations (not using the actual figures).

That's why it doesn't really make sense to expand. The actual money listed in the article (the $1 billion) is really just break-even money, for the current members of the conference. The contract has to increase above that for the current schools to actually get more money that what they get now.

 

[Rootmaster]

I give up...lol.

 

[michaelwalkerbr]

I give up...lol.

Don't give up. There would be a four or five year bonanza for the current teams as the new teams transitioned in for payouts from the conference like WVU and TCU did. The pro rata is to the conference, not the new teams. And as the author pointed out, the Big 12 could then demand a renegotiation of the broadcast contract with 12 teams simply because they have Texas and Oklahoma. Never argue with an ACC troll. You're better than that.

 

[topdecktiger]

Don't give up. There would be a four or five year bonanza for the current teams as the new teams transitioned in for payouts from the conference like WVU and TCU did. The pro rata is to the conference, not the new teams. And as the author pointed out, the Big 12 could then demand a renegotiation of the broadcast contract with 12 teams simply because they have Texas and Oklahoma. Never argue with an ACC troll. You're better than that.

You obviously aren't better than stooping to personal attacks, rather than deal with factual information.

You even said the same thing as I did in your first post. The pro rata increase only covers the cost of adding the new schools. It doesn't increase what the current schools already get, unless you shortchange the new teams. You COULD do that, but it's really a wire-hanger-and-duct-tape approach. There is nothing "trolling" about point out that the OP simply has it wrong on the pro rata increase. Sorry, but facts are facts. If you don't like the facts, get mad at Bowlsby and co. for setting up that contract.

 

[skygusty]

If new teams are added they will be offered a partial payout for a few years just like WVU and TCU were. The conference gets to claim and divvy up the diffference between the other conference members until the new ones get full share. So maybe the conference makes a little extra for a little while, but what is the long term risk? How the people who are guaranteeing the pro rata increase feel about this is anybodies guess, but they may not be enthusiastic about having to pay the likes of a Memphis or a UConn the same money they pay Texas. When the contract comes up for renewal they might feel a little less generous. I am more curious as to how this five team division concept is going to work. Can't wait for those details

 

[topdecktiger]

If new teams are added they will be offered a partial payout for a few years just like WVU and TCU were. The conference gets to claim and divvy up the diffference between the other conference members until the new ones get full share. So maybe the conference makes a little extra for a little while, but what is the long term risk? How the people who are guaranteeing the pro rata increase feel about this is anybodies guess, but they may not be enthusiastic about having to pay the likes of a Memphis or a UConn the same money they pay Texas. When the contract comes up for renewal they might feel a little less generous. I am more curious as to how this five team division concept is going to work. Can't wait for those details

Just out of curiosity, what is the five team division thing?

 

[Shipyard Dog]

I give up...lol.

....... :cool2:[cheers]

 

[Rootmaster]

I give up ...trying to educate those to whom knowledge is an alien concept. Yawn.

 

[topdecktiger]

I give up ...trying to educate those to whom knowledge is an alien concept. Yawn.

That's just an excuse because you can't refute the actual numbers.

And then there's this:

Adding four new schools could bring in an additional $1 billion over the remainder of the contract, which expires in 2025. Two new schools would bring in $500 million, according to the report. Boren on Friday confirmed the "pro rata" provision exists in the contract.

Current Big 12 schools do not stand to make more money under this provision, but each member's share of TV revenue would not be cut.
http://www.cincinnati.com/story/spo...ll-success-might-decide-big-12-fate/85349692/

So there you go.

 

[skygusty]

Just out of curiosity, what is the five team division thing?

Not sure - just that Bowlsby was quoted that they would split into two five team divisions, maybe still play round-robin, or not, and the two best teams from each division would play in the CCG instead of the two best teams, should the two best teams be from the same division. Nothing firm on this, just some sketchy reports.