Pac-12 presidents, George Kliavkoff ignored widely available industry expertise
You know by now that the Pac-12 presidents rejected a 2022 offer by ESPN which, if accepted, would have paid out $30 million per school and likely saved the conference. That’s really bad. It’s yet another embarrassment for a conference which is on its last legs and has been reduced to just four schools.
Yet, it gets worse. It always gets worse in the Pac-12. This is how the conference operates. There are always a few more details which make a bad situation even more embarrassing than we all appreciated 24 or 48 hours earlier.
The latest damning details come from Pac-12 insider John Canzano. In his report about longtime sports executive and administrator Oliver Luck being brought in as a consultant to the remaining Pac-4 schools, Canzano also included some notes on a media industry expert the Pac-12 presidents very clearly ignored over the past 13 months.
We have details on that and a lot more below. It’s going to be even more of a headache, but you have to read these details to get an even fuller picture of how badly the Pac-12 presidents messed up:
FORMER FOX CONSULTANT SAID IT OUT LOUD IN JULY OF 2022
Canzano — in his article from Friday, August 11 on Oliver Luck — linked to an article he published in early July of 2022.
In that article, former Fox Sports executive Bob Thompson told Canzano the value of the 10 Pac-12 schools — without USC and UCLA — was $300 million, or $30 million per school per year.
Let’s underscore this point: Industry assessments by experts were not hidden. They were out in the open. They were right there. People with lots of experience in the media industry were telling the Pac-12 presidents what their conference’s sports product was worth.
The presidents thought they could get $50 million per school.
What planet were they living on?
KLIAVKOFF COWARDICE
George Kliavkoff had worked for MGM entertainment and was seen as being media-savvy. Well, if he actually was media-savvy, he would have told the Pac-12 presidents this deal from ESPN in 2022 was as good as they were going to get. The $30 million payout per school was right in line with what industry experts were saying.
Kliavkoff needed to stand his ground, tell the presidents this was the deal they had to accept, and that’s it.
He didn’t do that. Here we are. Leaders have to stand up and tell other powerful people “no” sometimes. This was one of those times. Kliavkoff failed the leadership test.
USC IGNORED
Remember this: Pac-12 presidents refused, in the years prior to USC leaving for the Big Ten, to give the Trojans an extra (uneven) revenue share even though USC football significantly boosted the media rights value of the Pac-12’s overall product. Even before George Kliavkoff took over, USC was being undervalued and underappreciated by other Pac-12 schools.
USC MEDIA VALUE WAS SUBSTANTIAL
How much did USC football boost Pac-12 media rights valuations? In Canzano’s piece, Thompson — the former Fox executive — put the price point of a media deal with USC and UCLA at $500 million overall. Split among 12 Pac-12 schools (not 10), that’s close to $41.7 million per school. Compare that to $30 million per school without the Trojans and the Los Angeles market.
PAC-12 PRESIDENTS' HUBRIS
The Pac-12 presidents wanted $50 million per school in a media rights deal with USC not in the picture. A deal giving 10 schools (including Colorado and the other schools which recently bolted for other conferences) $50 million each would be worth $500 million.
That’s the price tag of the deal the Pac-12 could have gained if USC and UCLA were still members. The Pac-12 presidents essentially thought that USC and UCLA provided no extra value to the conference.
No wonder those two schools left. No wonder fans in Los Angeles are so glad to be rid of the Pac-12. The extent to which presidents were out of touch is off the charts.
MORE FROM BOB THOMPSON
Canzano notes that Bob Thompson, the former Fox executive, made several other correct predictions and industry forecasts. Thompson correctly said that Fox would not make a bid for primary Pac-12 media rights, only for a small secondary package at most.
NBC SPORTS
Thompson correctly said NBC Sports would not be a player in Pac-12 media rights negotiations. NBC is happy with Notre Dame and the Big Ten.
CBS SPORTS
Thompson correctly said CBS’ primary focus was on the Big Ten, to the extent that it wasn’t in a position to offer top dollar for Pac-12 media rights.
ESPN/DISNEY/ABC
Thompson correctly said ESPN had some resources but would not overpay for a Pac-12 deal. The $30 million per school figure was right in line with industry projections. This readily-available information was ignored by the presidents.
OREGON AND WASHINGTON VALUE
Canzano added this note on Thompson’s forecasts:
“Oregon and Washington’s value to the Big Ten would be approximately $30 million each. (Thompson was only off by ~15 percent. The Ducks and Huskies received an average of $35 million per year in the next six years).”
Thompson wasn’t really “off” in his projections. Fox offered Oregon and Washington a sweetener to join the conference because the Pac-12 was imploding. It was basically an incentive to get them off the island and bring them in. It’s not as though Fox and the Big Ten wanted Oregon and Washington initially, the same way they wanted USC and UCLA.
IT ALWAYS GETS WORSE
Just when you think the Pac-12 can’t possibly look worse than it already does … something comes along which makes everything much worse. This is merely the latest example.
