If the previous decade of leadership at the Pac-12 was defined by miscalculations on conference realignment, an inability to make its football product relevant in the national title discussion and a disastrous misreading of where sports television was headed, the league’s new leadership hasn’t done a thing to change the narrative.
If you want to give George Kliavkoff the benefit of the doubt roughly 1 1/2 years into his tenure as commissioner, go ahead. That’s apparently what the Pac-12 presidents are doing as they released a statement Monday expressing their solidarity and confidence in Kliavkoff’s ability to secure a media rights deal that will stabilize the league for at least the next several years.
But until Kliavkoff shows us the goods, it’s more than fair at this point to be skeptical about what media entity is going to pay top dollar to broadcast a Pac-12 that will no longer include Southern California or UCLA beginning in 2024. And if that doesn’t happen, what does that mean for the future of the league both in the short-term and over the long haul?
Despite the (overly?) confident projections coming out of the league office, administrators at Pac-12 schools are nervous. They should be. And while an utter collapse of the Pac-12 remains unlikely right now, every day that passes without a media rights deal is a day where the league looks weak and vulnerable.
After UCLA and USC announced their impending departures to the Big Ten last summer — a move that caught Kliavkoff completely off guard — there were two things he had to do to secure the Pac-12’s future. The first was to keep the remaining 10 schools together long enough to get through a negotiation with potential television partners, and the second was to land a bigger deal than the Big 12.
So far, so good on the first item. But at this point, even matching the $31.7 million per school that new Big 12 commissioner Brett Yormark secured during negotiations last fall with Fox and ESPN seems like a tall task.
How do we know? Because if that kind of deal was on the table for the Pac-12, it would probably already be done.
Instead, the Action Network reported Wednesday that CBS and Turner are not involved in those negotiations. NBC has gone all-in already on the Big Ten and Notre Dame. On the “Marchand and Ourand Sports Media Podcast” this week, John Ourand of Sports Business Journal said Fox would only take the Pac-12 for “pennies on the dollar.” And just last week, Disney CEO Bob Iger said during an earnings call with investors that ESPN would have to “get more selective” on which broadcast rights it wanted to pay for in the immediate future.
If you add all that up, it’s not easy to see where the Pac-12 lands a big-money deal on linear television. And while the Pac-12 has been engaging streaming partners as well, Ourand said on the podcast that Amazon is more interested in the best football game of the week than the bulk of the inventory the conference will offer.
And if the Pac-12 does end up parking a lot of its inventory on a streaming service, whether it’s Amazon or Apple TV or whomever, that’s a totally different world in terms of visibility than the rest of the power conferences whose schools are constantly going to be on ESPN and the major over-the-air networks.
Streaming may be dominant at some point in the future, and we’ve seen the NFL dabble in it with its Thursday night game on Amazon, but it’s not where you want your primary product to be right now.
“There was one big deal to be had, and the Big 12 got in there and got it, and things aren’t looking great for the Pac-12 from a linear TV perspective,” Ourand said.
Misreading the room
Maybe Kliavkoff will pull a rabbit out of his hat and silence the doubters. But for now, it looks like he may have misread the room about the Pac-12’s actual value — the same mistake his predecessor Larry Scott made when he convinced his presidents that the league would be better off owning the Pac-12 Network itself than partnering with a larger media company like the SEC Network did with ESPN or the Big Ten Network did with Fox.
The theory behind that decision was that even though the Pac-12 Network was struggling to gain distribution and wasn’t generating revenue, it was an equity chip that the schools could eventually cash in for hundreds of millions of dollars. Given the trends in cable television, it is almost certainly going to end as a failed experiment.
So what’s Kliavkoff’s actual plan? It’s hard to see how the recent speculation about expansion changes the math all that much. Sure, it would make some sense for the Pac-12 to add San Diego State and recapture at least a little bit of the Southern California territory that it lost with USC and UCLA.
But Kliavkoff’s trip last week to scope out SMU, which became public when he was spotted at a basketball game, is a head-scratcher. SMU is a terrific university and a solid athletic program that happens to be located in a great market.
Realistically, though, SMU is a private school with a relatively small fan base that doesn’t move the needle much in Dallas or anywhere else. Going so far outside the Pacific or Mountain time zones just to add SMU smells like a desperate dart throw in hopes that the theoretical “Dallas market” adds some dollars to a streaming deal. (If schools in major metropolitan areas were that valuable to media companies, why did the American only get $7 million per school in 2019 when it had Cincinnati, UCF, Houston, Memphis and Tulane?)
Whether expansion happens or not, there are enough context clues here to be concerned about what this deal is going to look like. It’s clear that the 10 current Pac-12 schools would prefer to remain in the Pac-12 over their other options, or else some of them would have defected last year when the Big 12 made it clear it had interest in poaching some West Coast schools.
Back then, it was plausible that the Pac-12 would end up in at least as good or maybe a better financial place than the Big 12. At least that’s what Kliavkoff was telling everyone as he successfully calmed the waters in the days after USC and UCLA’s departure.
But if Kliavkoff doesn’t deliver on that promise, all bets are off.
Story Credit: usatoday.com