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Was Conference Realignment All About Fox?

It sure seems like - for now - the inexorable march towards sixteen team superconferences is at best sleeping, or at worst dead.

After shrieking announcements that the Pac N was going to swoop in and poach five different football teams from the Big XII, the Big East might take all the rest and college football would be forever changed, it seems like, according to Andy Staples' Sports Illustrated article talking about the proceedings that "powerful outsiders, concerned that the Pac-10's plan to supersize to 16 by pillaging the Big 12 would set off an unstoppable chain of events, helped broker the deal, which may have saved college sports as currently constituted."

Staples stopped short of saying it, but it could very well be one of the "powerful outsiders" that saved the Big XII may have been one of the forces that seemed to be driving it to destruction: Fox. (more)



From the school perspective, you can describe conference realignment easily:  Texas held, basically, all the cards.  And they played them beautifully.  With strategic leaks to the new power broker in collegiate football, Orangebloods.com, a Nebraska move "would cause the Big XII to implode", then Texas was first going to the Pac Ten with five former leaguemates, then three - and finally, "for the good of regional rivalries, keeping Texas A&M in check, mom and apple pie", they would graciously let themselves be paid gobs more money, while allowing themselves the opportunity to create their own TV network to mint even more money for themselves.

(No wonder Texas is known for Poker.)

Sometimes I wish I'd just listen to what I wrote months ago on the topic of sixteen team superconferences.  No, I'm not going to sit back and say I was right about everything (because I most definitely wasn't).  But on Any Given Saturday and this blog I had a couple of fairly prescient predictions about how this was going to play out.

Folks seem to think the 16-team megaconference is where this is all going. I don't. The optimum number for conferences is still 10-12, and the 16-team mega-conference of the Big East is in trouble precisely because they're so big and schools don't like to share money.

...

Will the conference formerly known as the Big XII soldier on?

The answer to this question to me is - and this will be a surprise - maybe.

Why? The answer, unsurprisingly, comes from Texas.

The Longhorns won't move for just any old reason. Sure, if they can move with all their important rivals from the old Big XII to some other conference - without changing their revenue stream - they'll be fine with that. But they won't move just for the sake of moving.

And it makes no financial sense for Texas to go to the Pac Ten if they don't take along their leaguemates. They won't get the lions' share of the money if they're they and Colorado are the only team that goes, and losing Texas A&M will lose them the biggest rival of all. Losing them will hurt their brand badly, and they know it.

If I'm Texas and I'm faced with "going it alone", why don't I just try to make the Big XII work instead? Grabbing UAB and Southern Miss from Conference USA perhaps isn't the best option, but they at least will make the SEC squirm and bring a championship game back to the discussion. It would hurt to put Oklahoma and Oklahoma State in the North, but a Texas/Oklahoma championship game would be something to behold.

Best of all from Texas' perspective, they would still hold onto all the money.  They'd still have Kansas basketball, "history", and rivalries while they craft their own television network to make even more money.
To me, these words ring even more true now that Texas has returned to the Big Ten the conference formerly known as the Big XII.  While money was thrown around as the main reason for conference realignment to sixteen teams, the simple truth is nobody still has figured out how a sixteen team conference would work in football.  It certainly wouldn't create a fair champion unless you expanded the season, and even then it was dicey.  And let's just say that the only case study available - the sixteen-team WAC in the late 1990s - was a disaster.


What is really very interesting, though, is the "powerful outsiders" who wish keep the Big XII - and maybe the BCS and all the college football television arrangements - together.  Andy Katz from ESPN gives some tantalizing hints:

In an unprecedented move, a number of influential people inside and outside of college athletics mobilized over the past week to save the Big 12 Conference, stave off the Pac-10's move to expand to 16 schools and prevent a massive reorganization of college athletics.

An NCAA source with direct knowledge of what occurred told ESPN.com that the aggressiveness of the Pac-10 caused various factions of the collegiate sports world to coalesce. They then worked to slow and try to stop the pace of moves that would have left a number of schools searching for a new conference home.

The source said the people involved were business executives, conference commissioners, athletic directors, network executives with ties throughout college athletics, administrators at many levels throughout the NCAA membership and a "fair number of them without a dog in the hunt."

According to the source, this collection of interested and influential people made phone calls, visited in person and held conference calls with the Big 12 schools that were being pursued, including Texas, as well as Big 12 commissioner Dan Beebe. The influential group also helped broker the new television deal between Texas (and the other schools considering leaving the conference) and Beebe, who represented the remaining Big 12 schools.

In addition, the white paper Staples attaches to his piece,written by Big XII commissioner Don Beebe and distributed amongst members of the Big XII, makes for fascinating reading:

Even though television revenue still won't be split equally in the Big 12 -- a major bone of contention since the conference formed in 1994 -- the league promised its remaining 10 members that everyone would get more. Local television rights, as before, would remain property of the schools. That was enough for Texas, which now can explore the idea of starting its own cable network.

In the white paper, Beebe hinted at the possibility of a far more lucrative deal with Fox, which to this point has carried Big 12 games only on its regional cable networks. Though the Big 12's larger ESPN/ABC contract doesn't expire until 2016, the Fox deal is up next year. That allowed Beebe to float the idea of an almost immediate shot of new revenue.

"Conversations with Fox indicate their bullishness about competing in the future for our rights, and they have already made overtures about their willingness to pay exponentially higher rights fees than those in our current agreements," Beebe wrote in the paper. "A primary driver of higher rights fees are competitors for the rights and all information is that there are more serious bidders about to enter the marketplace."

Beebe also warned that the move to superconferences in a blatant cash-grab would have invited "more governmental, legal and public scrutiny" and could have resulted in athletic programs losing their tax-exempt status and possibly the payment of athletes for their services.

These two revelations are fascinating for different reasons.

Revelation Number One is that Fox and its family of networks, and their "bullishness for competing for their TV rights", was a main driver in keeping the Big XII together by essentially guaranteeing a better TV deal the next go around.  This was particularly interesting since Fox has been outlandishly active behind the scenes in terms of all this conference realignment talk in the first place.

Start with the Big Ten, where Fox owns a 49% stake in the Big Ten Network and nearly doubled their conference payout of three years ago - despite only increasing their subscriber base by 9 million households.  Either Fox soaked their existing subscribers for twice the amount - possible, but something I think may be unlikely - or they pumped money into the BTN in order to make it seem more lucrative than they said it was.  (Think that's ludicrous?  Well, you won't see any sunlight on those figures from Fox.  Those books are closed from public scrutiny.)

And when you look at the latest ACC TV deal with ESPN - thanks to the white paper offered by Mr. Staples - of $155 million per year - you learn that "Fox was a serious bidder for the ACC rights and drove up the fee higher than expected".  Interestingly, the Big XII, Pac Ten and Big Ten in the past benefited from pitting ESPN/ABC and Fox against each other in negotiations.

But the white paper reveals that "A primary driver of higher rights fees are competitors for the rights and all information that is there are more serious bidders about to enter the marketplace.  NBC/Comcast has sent serious messages about wanting to obtain more college football and Turner Sports has committed to more postseason basketball."

Could all this realignment talk actually be driven almost in its entirety by Fox, trying to get a stranglehold in the college football TV marketplace before "more serious bidders" get into the fray?

It's highly suspicious that realignment started with a Fox entity (the Big Ten Network) suddenly pumping more money into the Big Ten, the Pac N talking about a sixteen team conference with a brand new TV network (presumably also run by Fox, in the same way the Big Ten did it - heck, Big Ten commissioner Jim Delany could even be the go-between between the Pac N and Fox) - and ended with Fox committing to a bigger TV contract with the Big XII.  (Will Fox announce they're involved with the formation of the new Longhorn Network, through the "influential group that helped broker the deal" which could very well have involved Fox?  It would hardly be a surprise.

And it's also not surprising that Fox chose to back out of their original plan to create the Pac-16.  Which TV entities stood to benefit from the Big XII imploding?  Why the Big East (ESPN), of course, who might have taken Kansas, Kansas State, Iowa State, Baylor and Missouri in the deal, creating a college basketball powerhouse conference.  And when the SEC (CBS/ESPN) stood to pry some crown jewels away from the deal in the form of either Texas A&M and/or Oklahoma - all of a sudden, did Fox come to the conclusion that maybe getting better rights for the Big XII wasn't such a bad idea after all?


Folks like to kvetch about the polluting influence that money has had, and continues to have, on collegiate athletics and specifically conference realignment.  But if you follow the money, its pretty obvious how this is playing out.  Like Texas, Fox has played its hand brilliantly - but unlike the Longhorns, their involvement has been entirely behind the scenes.

*****

The second part mentioned in the white paper mentions that a "blatant cash grab" would have invited more "governmental, legal and public scrutiny" of intercollegiate athletics.  This choice of words was fascinating.

Governmental scrutiny of the actions of intercollegiate athletics - and, specifically, the BCS - is nothing new.  Several times, most recently in 2009, Congress has tackled the BCS and tried to, alternatively, forced it to open up to non-BCS competition (successfully), attempted to strip it of using "championship" in their crystal ball bowl, and also positioned themselves for a potential antitrust case against them (which hasn't been done - yet).

More interestingly, however, came some news from - who else? - Orangebloods.com:

GOVERNMENT INTERVENTION?

It has been expressed to Orangebloods.com by a top collegiate executive that any movement toward four, 16-team super conferences will be met with resistance by Congress.

The executive said that could be bad news for college athletics because Congress has already taken some cursory looks at the fact athletic departments enjoy a tax-exempt status as part of their universities.

The executive said if it appears the rich are getting richer in college athletics, there will be a hard look at whether to take away the tax exempt status of athletic departments.

"And it won't just be Orin Hatch (a member of the U.S. Senate Finance Committee from Utah and longtime BCS critic) looking into this," the source said.

Stay tuned.

If key elements of the Big XII were set adrift by Texas, it would have been a political slam dunk to see senators from Kansas, Missouri (freshly spurned by the Big Ten), Iowa, and even Baylor grads from Texas take up the fight to break up the superconferences.  That's an awful lot of senators to go with the ones from Utah, and potential others.

But Beebe's statement that superconferences would "invite more public scrutiny" implies that all is currently not well in the land of BCS, either.

That they don't want the public looking into things like, say, the undue influence that Fox may have had in all of these proceedings.  They don't want people following the money in any way - Fox's, ESPN's, CBS's, NBC's - anybody.  They like things the way they are - fans shelling out the money for their product, and the athletic directors cashing the checks (out of their tax-exempt offices), no questions asked.


I think what the upshot of all of this conference realignment talk ought to be to cast a shining light on everything in FBS athletics.  A crystal-clear look at the finances of the BCS, Fox's broadcast entities within athletics, the ESPN contracts, CBS, NBC, everything.  Right now, the conferences look ever more like pawns on the Fox and ESPN chessboards and the movements have everything to do with TV households and nothing to do with college football.  The sooner everyone realizes this, the sooner collegiate athletics will be cleaned up.

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