With College Football Playoff format and future revenue in flux, here's what's on the table
As College Football Playoff leaders continue to examine the future of the enterprise, the industry sits on edge.
The Big Ten and SEC flex their proverbial muscles. The Big 12 and ACC toil over compromise.
Playoff formats and revenue models continue to circulate.
A deadline looms. An agreement is absent.
And for some, a troubling certainty exists: Any deal reached will drive a further financial wedge among the four major conferences.
The CFP is barreling toward a new format and revenue model that skews toward the new Power Two of college athletics, creating a more formal delineation between two groups: the SEC and Big Ten; the ACC and Big 12.
While the Power Two separated themselves long ago through increased revenue streams and recent expansion, a new playoff model is expected to draw a more permanent line. Using an uneven revenue distribution, a tangible separation is forming between college football’s haves and those that were once veritable equals in the space.
Those with knowledge of the proposals spoke to Yahoo Sports under condition of anonymity.
“You have two leagues asserting their power,” described one college athletics administrator.
CFP format and revenue distribution
Any decision on a playoff format is taking a back seat to a more significant piece: the money.
A revenue-distribution model has surfaced that would distribute annually to the SEC and Big Ten multiple millions in additional revenue than their two power league counterparts. While an expected move, the figures shocked those who have seen the proposal.
In the past structure, the five major conferences mostly split evenly 80% of the CFP’s $460 million in revenue.
In a proposal socialized with administrators this week, the Big Ten and SEC would combine to earn about 58% of the CFP’s base distribution — a figure that will certainly grow in participation distribution as their individual schools earn more revenue for qualifying and advancing through the playoffs. The figure would greatly exceed the ACC and Big 12’s combined distribution number, which is expected to be around 31%. The remaining amount (roughly 10%) will be distributed to Notre Dame and the 64 Group of Five teams.
The difference in distribution between the two sets of conferences — SEC/Big Ten and ACC/Big 12 — will likely exceed $300 million a year. The Power Two will earn around a combined $760 million versus around $440 million for the ACC and Big 12. Roughly $115 million is slotted for the Group of Five.
No school’s revenue will decrease as the CFP is expected to distribute about $1.3 billion annually in a new television contract with ESPN, or three times the amount of its past deal in the four-team version. The participation distribution is only expected to account for $100 million of the overall distribution amount. Teams will earn between $3-5 million each for participation and advancing in the playoff.
Considering the distribution percentages, SEC teams will earn as much as $23 million annually, Big Ten $21 million, ACC around $13.7 million and Big 12 around $12.3 million. Group of Five teams are expected to earn a figure just south of $2 million.
The contract is expected to include a definitive “look-in” provision in 2028. The look-in provision can be triggered before that date from any conference realignment — a provision that Big 12 commissioner Brett Yormark encouraged to be added, according to those familiar with the discussions.
A playoff format is further from being settled.
A variety of 14-team formats continue to circulate across the industry, including the one that made news last week. It grants three automatic qualifiers each to the SEC and Big Ten, two each to the ACC and Big 12 and one to the highest-ranked Group of Five program, with three at-large spots — a 3-3-2-2-1+3 model.
There is, as well, a 2-2-1-1-1+7 model. It grants two automatic berths each to the SEC and Big Ten, one each to the ACC and Big 12, one to the highest-ranked Group of Five, with seven at-large spots. There is also a 5+9 model that mirrors the current 5+7 12-team format but features an additional two at-large spots. Presumably, that model would grant automatic berths to the five highest-ranked conference champions.
The concept of the Big Ten and SEC holding exclusive rights over the two first-round byes has received enough pushback that many expect it to be tabled.
The money is the more important matter.
Revenue is more significant than ever. The major conferences and their members are gearing up for a future athlete compensation model. The concept — whether employment, revenue sharing or collective bargaining — necessitates extra cash flow to be put aside for players.
The time-honored method of distributing revenue evenly recently imploded at the conference level. Washington and Oregon took a discount to join the Big Ten. SMU, Cal and Stanford did the same to join the ACC, a league that is now distributing funds not evenly but based on mostly football performance.
Now, the trend has reached the national stage. The CFP base revenue-distribution model is mostly based on historic success in the playoff over the previous decade. Considering future realignment moves, the SEC and Big Ten account for 72.5% of CFP participants. The SEC leads all schools with 17 in the four-team field when factoring in Oklahoma and Texas. The Big Ten is next at 12 when factoring in its four new schools. The ACC (seven teams) and Big 12 (two) follow.
“I’m watching this real-life curing of conferences,” Washington State president Kirk Schulz, the Pac-12 representative on the CFP Board of Managers, told Yahoo Sports last month. “You have the Big Ten and SEC and then drop down a level to ACC and Big 12 and then you drop down to Mountain West and AAC, at least in terms of football. Pac-12 is somewhere in all that. I’m glad to see some national leadership from the Big Ten and SEC. Somebody needs to take the reins, but it’s probably a little scary if you don’t happen to be in the Big Ten or SEC. Is there going to be some dictating, ‘This is what things are going to look like’?”
The format aside, the money split alone is causing anxiety in both the ACC and Big 12, with some of the administrators asking a vexing question:
“Would the Power Two really leave if we say no?”
What's the ACC's place in this?
The ramifications of college football’s new tier could be wide-ranging, none more impacted than the Atlantic Coast Conference.
The CFP’s further delineation of the power structure in the industry likely exacerbates the ACC’s plight in keeping some of its biggest brands from exiting. The gap in the revenue-distribution model may further incentivize programs to follow Florida State’s example at a legal attempt to exit.
As their television deal falls further financially behind the Power Two, seven ACC schools — FSU, Clemson, Miami, North Carolina, NC State, Virginia and Virginia Tech — met independently last year to explore a potential exit strategy from the ACC’s grant-of-rights. Leading the expedition were Florida State and Clemson, the two most disgruntled and, perhaps, valuable programs seeking a new conference. FSU took an initial step in its exit strategy in December, making a legal filing against the league. Court dates are set for later this spring.
Attorneys for Clemson have spent the last several months gearing up for legal action of their own, sources with knowledge of the discussions tell Yahoo Sports.
More secession attempts could send the conference into chaos. The outcomes of any Florida State or Clemson exit — can they break free of the grant-of-rights? — may chart a path for the other members of the seven, most notably North Carolina, the most attractive of the programs.
Could the seven independently leave the league and reform as a smaller, more valuable conference? Could a subset of the seven join a new conference — the Big 12, SEC or Big Ten?
A date looms as a possible inflection point in the ACC’s future.
While ESPN’s contract with the ACC extends through 2036, the network has the option to opt out of the final nine years starting in 2027, a way that ESPN itself could possibly reopen the grant-of-rights, or at the very least, restructure the deal.
Could a restructured deal with uneven distribution prevent more departures? Would an ESPN opt-out swing open the door for more schools to exit?
The network must exercise the option by February 2025.
The timeline
According to its own reporting, ESPN is in the final stages of agreeing to a six-year extension with the CFP that will pay the entity around $1.3 billion annually to televise the expanded playoff through 2031 — 12 teams in 2024 and 2025 and, presumably, 14 teams starting in 2026.
The offer has been on the proverbial table now for more than a month as CFP leaders wrangle over an assortment of issues — a playoff format, a revenue-distribution model and a voting structure. Network officials have conveyed their need for a decision.
An internal deadline of sorts has been set — by the end of next week — for the conferences to agree or bail on a future CFP framework and, presumably, the ESPN deal entirely. It’s still not completely clear how an agreement will be made as there is currently no contract or voting structure beyond the 2025 playoff. The ESPN deal is the only thing binding the 10 leagues and Notre Dame.
Unanimity is not a requirement and will not be a requirement in any new contract — an expected change to the playoff’s voting structure. The expectation is that those conferences, plus Notre Dame, willing to commit to the future framework will be part of the CFP beyond 2025.
