One strong reason for the Pac-12 to be optimistic about future football revenue
No one studies the numbers or knows the math of Pac-12 television and media rights better than Jon Wilner of the Wilner Hotline.
His recent analysis of Pac-12 football television revenues unearths one really important point which should make George Kliavkoff and the conference optimistic about the next round of media rights they will negotiate.
Let’s mention one thing at the outset: Pac-12 Networks will likely not show a lot of football in the future. There’s a decent chance that football and basketball will be moved off the network so that ESPN and other TV and streaming partners with wider distribution (and better price points) will carry the Pac-12’s revenue sports. Pac-12 Networks will likely become a central home for Olympic sports and still provide a useful outlet for Pac-12 fans.
Now let’s turn to Wilner’s analysis:
The Pac-12’s current 12-year agreement with Fox and ESPN carries an average annual value of $250 million. The vast majority — about 85 percent — is tied to the football inventory. That’s $212.5 million per year.
According to the term sheet, the two networks have the rights to 45 football games per year, including the conference championship. We don’t know how much the title game is worth, so for the sake of simplicity, let’s just split the $212.5 million evenly over 45 games.
That works out to an average of $4.72 million per football game on ESPN and Fox over the life of the 12-year contract.
However, another 36 football games — or 44.4 percent of the total owned by the conference — are broadcast by the Pac-12 Networks each season.
For those, the net revenue to the schools is … a pittance.
Again, the average annual payout to each campus from the Pac-12 Networks is about $2.5 million. With 12 schools, that works out to a nice round $30 million per year in the total amount distributed.
So the wholly-owned, Larry Scott-created media company generates about $30 million annually in profit and broadcasts 36 football games.
That’s $833,333 in real dollars for the schools per game.
So we’re left with the campuses receiving $4.72 million for each football game on ESPN and Fox and $833,333 for each game on the Pac-12 Networks.
You can connect the dots here. Simply by moving inventory off Pac-12 Networks and getting a much more competitive price on the market through ESPN or a streaming service such as Apple, the Pac-12 is poised to make millions more dollars per football game for the life of the new media rights deal it will eventually negotiate.
Let’s be clear: The Pac-12 isn’t adding value. USC being out of the Pac-12 obviously hurts the Pac-12’s ability to grow value. However, this is a reduction in lost value and lost revenue. The Pac-12 can claw back millions of dollars it was losing due to Pac-12 Network. It does mean more money in the coffers, but in a context of reduced losses, not outright gains.
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Complete Pac-12 football game predictions for 2022
