Month: January 2010

Big Ten Expansion Follow-Up Post #3 – More on the Financial Gap Between the Big Ten and Big 12, Notre Dame’s Independence in Question, East Coast Family, and Fallout in Other Conferences

On By Frank the TankIn Big Ten, Illinois Fighting Illini, Sports163 Comments

I never intended this blog to be exclusively devoted to Big Ten expansion issues (and one of these days, I’ll get back to my regularly-scheduled moaning about the respective states of the Illini, Bears and White Sox as well as analyzing the inevitable Bulls trade deadline rumors that make “Texas to the Big Ten” seem like a lock by comparison), yet a number of recent comments from all of the wonderful readers out there and news events necessitate another follow-up post. If you haven’t already read them, here are the original Big Ten Expansion Index post and follow-ups #1 and #2.  As a side note, there’s been a bit of speculation that I must be an unemployed stoner or doctoral student (or both) to have the time to write such long posts.  In reality, I’m actually an extremely time-pressed attorney that is raising twin babies at home, which is why I hadn’t written anything prior to the Big Ten Expansion Index post for a period of 6 months.  Thus, these blog posts are the product of halfway-cognizant insomia (and I really wish I was joking about that).  Anyway, let’s go through everything in general categories:

1. Missouri Would Have a $10 Million Financial Boost with Big Ten Membership (and Texas would, too) – The St. Louis Business Journal has presented an analysis that shows that it would make at least $10 million per year more in the Big Ten compared to the Big 12. This is based on the current Mizzou revenue share in the Big 12 of around $8.4 million and the Big Ten’s revenue figures of today (which would assuredly jump with the addition of a conference championship game and additional Big Ten Network subscribers). What’s also noted in the article (but not emphasized since this is written from the Mizzou point of view) is that the Texas revenue share in the Big 12 was around $10.2 million last year (which was the most in that conference), which is even less than what I was basing my financial assumptions on in the original Big Ten Expansion Index post. For all of the squawking from non-Texas Big 12 fans that I’ve seen on virtually every blog and message board that has reviewed my blog posts, the supposed Texas control of revenue in the Big 12 amounts to less than a $2 million per year advantage over Missouri (not chump change, but not exactly dominating, either). Yet, according to the St. Louis Business Journal’s numbers, that $2 million difference would pale in comparison to the minimum $10 million per year boost that either Missouri or Texas (or any other Big 12 school) would receive by going to the Big Ten.

As Deep Throat once said to Bob Woodward in a dingy parking garage, “Follow the money.” Even if you reasonably believe that a school like Texas would ultimately have to reject an invite from the Big Ten due to political factors (which I fully acknowledge is a critical issue), the financial calculations from the St. Louis Business Journal would show why Texas would at least look at Big Ten membership seriously and that this isn’t a proposal that’s going to be ignored from the beginning (as a lot of non-Texas Big 12 fans seem to believe). Let’s put it this way: if some other company proposed to give you a $10 million raise for doing the exact same thing as you’re doing now, chances are that you aren’t just going to completely ignore it and say, “Nope. I’m not even going to listen.” Non-Texas Big 12 fans (as well as fans from a lot of other conferences) want or hope that’s what Texas is going to respond to an offer of at least $10 million more per year (or to put it in more impactful terms using simple multiplication, a minimum of an extra $100 million over the course of 10 years): “Nope. I’m not even going to listen.”  This isn’t even accounting for the fact that (1) people seem to expect Texas to just let Missouri walk away to double its TV money and concurrently weaken the already poor Big 12 contract (thereby pulling the Longhorns’ TV revenue down even further) and (2) the academic funding from the CIC dwarfs the athletic side of the equation. 

I can completely accept the argument that the Texas state legislature could kill this deal from a political standpoint, but I don’t think anyone can reasonably believe that any school is going to just automatically turn down at least $100 million over the course of 10 years without performing some heavy due diligence and analysis to see whether it’s worth it.  Plus, it’s not as if it’s only the beancounters from Wu-Tang Financial are considering this a real possibility.  For the skeptics out there that the Texas fan base would be completely against this, please look back at the comments from Texas alums to my prior posts along with the links to various Longhorns blogs and message boards and see what they’re saying.  In addition to all of that, here’s yet another fairly positive discussion from the Texas blog Burnt Orange Nation.   Once again, think like a university president as opposed to a sports fan here.  The Big Ten offers Texas and every other school in the Big 12 (and frankly, every other BCS conference) more money for the athletic department via its TV contract and more money for academics via the CIC.  Any university president is at least going to evaluate that type of proposal with some heavy consideration.

2.  Notre Dame Almost Joined the Big Ten in 2003 – Last week, Notre Dame basketball head coach Mike Brey spilled the previously unknown beans about how extremely close the Fighting Irish were to joining the Big Ten when the ACC raided the Big East back in 2003. If you read the initial Big Ten Expansion Index post, you’ll know that every single Big Ten school makes about twice as much TV money as Notre Dame’s NBC contract (and as shown by my first follow-up post, the additional money Notre Dame receives from the Big East basketball TV contract basically amounts to a rounding error to any school in the Big Ten). What’s interesting to me about the Brey story is that Notre Dame was so close to joining the Big Ten even when it wasn’t in its financial interest to do so at that time (since the NBC contract was the gold standard for college sports in 2003). Now that it is arguably very much in Notre Dame’s financial interest to join the Big Ten, maybe the “Notre Dame will never join a conference” line of thinking isn’t as iron-clad as previously thought.

Notre Dame athletic director Jack Swarbrick even acknowledged that the Big Ten makes substantially more TV money than what the Irish receive from NBC in this Chicago Tribune story from last month.  Look at Swarbrick’s quotes closely in that article.  While that story was widely cited by the national media as Notre Dame supposedly preemptively rejecting the Big Ten, as a fellow attorney, I recognize and respect how carefully parsed Swarbrick’s statements were and that he effectively didn’t say anything at all.  If Notre Dame were to join the Big Ten tomorrow, there is absolutely nothing that Swarbrick said that would’ve been a lie.  Still, Notre Dame depends upon alumni support more than any other BCS school and Sully’s comment on my Big Ten Expansion Index post is indicative of what they’re thinking. I’d still wager that Texas has more of chance of being invited and accepted into the Big Ten than Notre Dame at this point in time.

3. The East Coast Family – I’ve seen a fairly large number of suggestions that the Big Ten ought to go to the 14-school route with a full-on Big East raid of Rutgers, Syracuse and UConn.  The argument is that while none of those schools by themselves can deliver the New York City market, putting all of them together could very well do so plus gain traction in New England on top of that.  It’s a plausible scenario, but I still stand by my stance on the only way that it would be worth it to have a 14-school conference: “… using a historical NBA superstar comparison, if the 12th Big Ten member has to be at least at the level of Kobe Bryant, then the 13th and 14th Big Ten members have to be both Michael Jordan and Wilt Chamberlain.”  I’m confident that Texas fans will beat down any cable provider in its home state that doesn’t carry the Big Ten Network on basic cable.  I’d also say the same about a slew of other Big 12 schools, including Nebraska and Missouri.  However, I just don’t have that confidence in any of the Big East schools or even three of them together to deliver their own markets.  The Big Ten would only make a move for sure things and the problem is that the northeastern schools are the least sure moves out there (even if they have the greatest potential number of households).  Once again, the only “plausible” scenario that I see the Big Ten going up to 14 schools is that it absolutely must take Texas A&M in order to get its real target of Texas, in which case a 14th school on top of them is needed to round everything out.  3 additional schools would need to add over $60 million to the conference pot in order to maintain the per school revenue status quo, so it would take 3 blockbuster schools in order to do that.  I believe that the objective of a 14-school Big Ten is to make markets irrelevant – at that point, it’s all about making the Big Ten Network into an ESPN-esque must-have channel in every home in the country.  Otherwise, it’s not worth it to expand to that size.

Others have asked again that I examine some ACC schools, such as Maryland and Boston College.   Those types of schools are definitely enticing from an academic and TV market perspective (and I’d love Miami in particular for a lot of reasons), but I’ll reiterate that I don’t think that the Big Ten is going to be likely to lure anyone from there even with that conference’s own TV issues.   There’s a scene from Wall Street where Bud Fox is livid that Gordon Gekko has decided to break-up Blue Star Airlines (where Fox’s father worked at as a union leader).  Fox asks Gekko, “Why do you need to wreck this company?”  Gekko screams back, “Because it’s WRECKABLE, alright?!”  In terms of college conferences, the Big 12 and Big East are wreckable in a way that the other BCS conferences aren’t at this time, which is why I’ve continued to focus on expansion candidates from those two particular conferences.  The ACC, in contrast, has a collection of academically-minded universities that have similar goals from top to bottom much like the Big Ten and Pac-10.

At one time, I was completely convinced that the Big Ten would look eastward if it ever decided to add a school other than Notre Dame.  However, I’m suspending that thought until the marquee Big 12 schools like Texas are completely off the table.

4.  Nationwide Conference Fallout – Finally, part of the fun of speculating about what the Big Ten would do in expansion is how the other conferences would respond.  How would the Big 12 react if it loses a school?  What about the Big East?  Will the Pac-10 finally go to 12 schools itself?  How would the non-BCS conferences be affected?

If Notre Dame were to move to the Big Ten, it would probably be the biggest news but also have the least impact on other conferences (at least football-wise).  The Big East would have to replace a basketball member, which would likely come in the form of an all-sports school to finally give its football conference 9 teams.  Current Conference USA members Memphis, East Carolina and Central Florida (UCF) are considered to be the main options for the Big East, which is a whole lot of “meh” for a conference really needs a marquee football member that it probably won’t ever obtain (even though the conference has done pretty well overall since the ACC raid in 2003).  Still, Notre Dame going to the Big Ten doesn’t take away anything from Big East football.  Syracuse or Rutgers going to the Big Ten, though, takes a whole lot away from the Big East.  If the Big East ends up having to add one or more of the aforementioned options from C-USA in that scenario, that’s going to be a significant blow to the conference’s national reputation.  I personally think that the Big East’s automatic BCS bid will be safe if it only loses one school since the states that the conference represents are just too politically and publicly powerful through the media to kick out, but you might see a split from the Catholic basketball schools at that point (which would have massive repurcussions in conference alignment for basketball).

In the event that one or more Big 12 schools leave for the Big Ten, I believe that BYU and Utah would be the consensus top candidates (in that order).  I put BYU ahead of Utah for the simple fact that BYU delivers Utah’s market plus a national fan base with its Church of Jesus Christ of Latter-Day Saints (LDS) members (similar to Notre Dame’s hold on Catholics).  BYU’s religious underpinnings wouldn’t concern the Big 12 seeing that it has Baylor as a member and that school only started to allow dancing a few years ago.  (As you’ll see, though, those religious underpinnings will automatically kill BYU’s chances elsewhere.)  A lot of the public seems to think that TCU would get into the Big 12 if there was an open spot, but this is another classic case of people thinking like sports fans as opposed to university presidents.  If there’s one point that I hope everyone that has read my posts understands, it’s that the lack of major TV markets in the Big 12 outside of the state of Texas is specifically what makes that conference vulnerable (and why Missouri and Nebraska would accept a Big Ten invite in a heartbeat and I think Texas and Texas A&M would strongly consider it).  So, TCU provides exactly as much TV value to the Big 12 as Cincinnati and Iowa State would to the Big Ten: none whatsoever.  The Big 12 isn’t going to add yet another Texas school when the conference’s #1 issue is not having enough of a presence outside of Texas.  Thus, the only way that TCU gets into the Big 12 is if BOTH Texas and Texas A&M leave the Big 12 at the same time and the conference decides that it needs TCU to shore up its Texas home base.  Other schools that might be in the mix for the Big 12 are New Mexico (who is very underrated as an expansion candidate in my opinion since it’s a flagship with a good fan base in a growing state) and Boise State (who is very overrated as an expansion candidate since they’re very hot now yet I’m not sure if they bring that much value when they go through an inevitable down period).  In any event, the Mountain West is almost certainly screwed as a conference if the Big 12 loses a school.

The Pac-10 expansion situation is extremely difficult to predict because of this simple fact: any expansion candidate needs unanimous approval from all 10 members in order to receive an invite.  In contrast, the Big Ten needs an 8-3 majority to add a school.  So, the unanimous vote requirement is the key to virtually everything in the Pac-10.  I can’t tell you how many people that I’ve seen suggest that the Pac-10 will eventually invite BYU without understanding why it would neverever happen.  Let’s think about this for a couple of seconds: in order for this to occur, it would require the University of California-Berkeley to vote affirmatively to share money and associate itself with BYU and the LDS.  If that disconnect isn’t obvious to you for some reason, let’s spell it out at a rudimentary level: California liberals have complete disdain for the LDS because of how much money that the church poured into the state to kill all of the gay rights propositions over the past few years.  BYU happens to be the intellectual nerve center of the LDS.  The most liberal institution in the most liberal city in California (if not the entire United States) happens to be the University of California-Berkeley.  You will see riots in Berkeley that would harken back to the 1960s if Cal even considered for a moment to allow BYU to join the Pac-10.  This isn’t even accounting for other ultra-liberal schools in the Pac-10 like UCLA and Oregon.

Utah is a little more palatable, but remember that the Pac-10 couldn’t even agree on inviting Texas back in the 1990s (otherwise, the Longhorns would now be members of that West Coast conference).  If a clearly academically and athletically superior Texas couldn’t get a unanimous vote from the Pac-10, I don’t know if Utah would even stand a chance.  Granted, the Pac-10 would probably like a mulligan on Texas and they’d take Colorado, as well, but with the revenue disparity between the Big Ten and Pac-10 so large today, I doubt that Texas would choose the Pac-10 over the Big Ten at this point if it ever left the Big 12.  Also note that having each school play both USC and UCLA annually is critically important for recruiting, ticket selling and TV purposes.  This year’s Pac-10 football champ of Oregon, for example, had most of its players come from Southern California who were hypnotized by all of the green and yellow hues on the Ducks’ uniforms.  This is also the case for virtually every other Pac-10 school.  Therefore, if the Pac-10 were to propose to go up to 12 schools, anyone that has to give up games against USC and/or UCLA in order to play a Utah-level school will automatically vote against expansion, as well (unless you’re talking about another top TV market like Texas).  Academics are also as important to the Pac-10 as the Big Ten, so any candidate that doesn’t have top academic credentials (i.e. Boise State and UNLV) is going to rejected by the likes of Stanford.  With such a high standard to get expansion approved in the Pac-10 and a lack of any obvious expansion candidate on the West Coast, the Pac-10 is probably going to end up standing pat no matter what happens.

I have a ton more thoughts on how other conferences might react, but I’ll save for those for a later date.  Keep those comments coming and I’ll provide more feedback in the near future.

(Image from Population Statistic)

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Big Ten Expansion Index Follow-Up #2 – Nationwide and Longhorns Fan Responses on Texas to the Big Ten

On By Frank the TankIn Big East, Big Ten, College Basketball, College Football, Illinois Fighting Illini, Sports85 Comments

Leading up the National Championship Game (which Texas sadly lost despite about as good of an effort that you could’ve expected from redshirt freshman quarterback Garrett Gilbert having to replace injured starter Colt McCoy in the first quarter), the original Big Ten Expansion Index post and its first follow-up somehow exploded over message boards and blogs over the past few days.  So, I’d like to address a few overarching issues that particular fan bases have brought up and, most importantly, what Texas alums and fans actually think about this (and if those Longhorns supporters are indicative of what that school’s fan base overall believes, then fans of other Big 12 schools are VERY far off on how Texas is approaching this expansion cycle and they better hope their schools are engaging in some CYA of their own).  Obviously, you can only take so much from blogs and message boards since you’ll get a lot of extreme comments, but it’s been fascinating to review the general views and themes that I’ve been seeing from various fan bases.  Once again, I’ll need to put off the additional analysis of other expansion candidates since there’s a whole lot to chew on already.

There’s one issue that I wanted to clear up immediately – a lot of people have questioned my statement that there isn’t any rule that all Big Ten states must be contiguous.  Here is confirmation from an official Big Ten spokesman that there is absolutely no such geographic rule and he also confirms that AAU membership isn’t an outright requirement.  While I believe as a practical matter that the lack of AAU membership is really geared toward allowing an exception for the non-AAU member of Notre Dame (and no one else), I really hope that it gets hammered home that there is no rule whatsoever in the Big Ten charter about geography and conference states having to touch each other.  As I originally stated, that rule is purely an Internet urban legend.  Now that we’ve put that to bed, let’s get to my observations on how the sports message board community is responding to the Big Ten Expansion Index:

1.  Big Ten fans love it – I haven’t come across a single overall fan base that wouldn’t be absolutely ecstatic to see Texas in the conference.  The geographic issues seem to be irrelevant when it comes to a school of the stature of Texas.  In particular, Penn State fans have generally been extremely supportive of the prospect of the move (see Blue White Illustrated, Penn Live and Penn State Hoops as some examples) which was the main fan base that I was interested in feedback from since there has long been the perception that they want an Eastern travel partner like Syracuse or Rutgers.  That perception has turned out the be erroneous – while they might wonder what a school like Missouri would do for them, they are extremely knowledgeable about what Texas would bring to the Big Ten and would be gung-ho about it.  Please also see thoughts from Ohio State (edit: lots of Buckeye fans have jumped on this – here’s another example that includes conversations with Texas alums), Iowa, Michigan State, Wisconsin and Michigan fans.  Simply put, the Big Ten fan bases generally have little concern about where Texas is located.  Of course, there is healthy skepticism as to whether it could ever be pulled off.

2.  Rutgers fans don’t like it and think that I overrated Syracuse – This Rutgers message board was really the one that started the avalanche of visitors.  I started to engage a number of the posters on that board, yet with all of the new comments on my blog post itself coming through, I had to stop the discussion on my end.  The main thrust of the Rutgers supporter argument is that Syracuse doesn’t really deliver the New York City market and even if Rutgers can’t deliver the entire New York DMA, it can at least provide the New Jersey portion, which is valuable in and of itself.  That’s a compelling argument, yet I’m still skeptical that Rutgers can deliver even just New Jersey, much less the entire Tri-State area.  I might be wrong on this and I’m sure this is an issue that the Big Ten will examine closely over the next 12-18 months.  Regardless, I believe my skepticism is valid and it’s why I gave Rutgers a relatively low TV Market Value score despite its great location on paper.  Until there is proof that Rutgers can truly deliver its home market (and not just be located in it), that school is an open question mark.

4.  Missouri fans don’t like it and think that I overrated Nebraska – The general public has long talked about Missouri as one of the front-runners to join the Big Ten, so they certainly didn’t like being ranked below two of their conference-mates, especially Nebraska.  Mizzou fans have a valid point that Nebraska may not meet the academic qualifications, which is something that I acknowledged when I stated in the original post that I was giving the Cornhuskers “the benefit of the doubt” on that front.  I would not be surprised at all if Nebraska got nixed automatically by the Big Ten on academic grounds, yet it’s arguable that the school’s AAU membership will still carry some weight.  The Missouri fans also expressed something in common among Big 12 fans outside of Longhorns fans…

5.  Non-Texas Big 12 fans are convinced that Texas won’t ever want to leave the Big 12 – Please see the message boards from Missouri, Nebraska, Colorado and, of course, Texas A&M virtually all expressing the same strain of thought.  To them, Texas wouldn’t want to (a) go “play in the snow” in Big Ten country, (b) leave their rivals of Texas A&M and Oklahoma, (c) incur massive backlash from the Longhorns fan base and major donors, (d) deal with the political heat in the state of Texas if they were to leave, and, most importantly and by far the biggest reason, (e) ever give up the “control” of the Big 12 that they now have.  As we’ll see from the general feedback from Longhorns fans, only one of the thoughts has really crossed their minds at all on this issue, but we’ll get to that in a moment,

6.  Other fans think that I’ve been ingesting some strong peyote for even suggesting this – Taking a look at boards from LSU, Virginia, the Rivals national college football site and, as we’ll always have to deal with regarding Big Ten expansion, Notre Dame, the thought of Texas going to the Big Ten is so foreign and ridiculous that no financial and academic reasons could rationally support it.  From their perspective, I should’ve just thrown out that the Big Ten should invite USC and Florida, too, with such a low likelihood.  To be fair, the original posters on these threads typically enjoyed my blog post or at least acknowledged that it was an interesting take, where it was then shot down by others like Sonny Corleone at a toll booth.

So, let’s take a look at the people that actually matter in this discussion, which are the Texas alums and fans…

7.  Texas fans are more open to this than I could’ve ever possibly imagined – When I wrote the original Big Ten Expansion Index post, I had a feeling that it would appeal to the financially and academically-minded people that understood the massive differences in revenue between the Big Ten and Big 12, the inherent instability within the Big 12 and the academic benefits of the CIC.  What I didn’t know, however, was how the “average sports fan” at Texas that I referred to so much in that post would take this suggestion.  I could list out all of the financial and academic advantages to Notre Dame fans, yet I was certain they would be steadfast in having an immediate rejection of any thought of joining the Big Ten.  Would Texas fans be the same way?

Well, the feedback that I’ve received from Texas alums and fans has been absolutely astounding, especially when so many have taken the time to review my blog posts when what I would’ve been doing if I was in their position was to look at national championship game stories for days on end.  Please take a look at the following Texas message boards discussing my blog posts at HornsFans and OrangeBloods (subscription required), the comments from my previous two posts, and as these two Barking Carnival posts here and here about the prospect of Texas switching conferences that were written before I had created the Big Ten Expansion Index (so those were organically and separately discussed by Texas fans without my index being a catalyst).  As you’ll see, there was certainly a good number of people opposed to the idea.  There were concerns about the effect on non-revenue sports, particularly baseball, where Texas has a power program.  Some people expressed a preference for going to the Pac-10 or even becoming an independent like Notre Dame.  Recruiting could possibly a factor if there are more road games played outside of Texas.  Finally, there was the important topic about whether it would be politically feasible in the state of Texas for the school to make the move to the Big Ten.

However, the overarching message was very clear to me: Texas fans have virtually no emotional attachment whatsoever to the Big 12 and the alumni are more than willing to seriously listen to the Big Ten.  There was nary a mention about supposed Texas control of the Big 12 nor was there much of a concern of having to play their rivals of Texas A&M and Oklahoma in the non-conference schedule.  Having been through the Southwestern Conference implosion of the 1990s, they are very aware that there are inherent problems in the Big 12, such as the poor TV contract, that will be almost impossible to rectify because of the small TV markets that conference has outside of Texas and they are determined not to be in that situation again.  In fact, it is almost the antithesis of the Notre Dame situation.  Whereas the general public seems to think Notre Dame should join a conference, the Notre Dame alums reflexively reject that notion.  In contrast, the general public appears convinced that Texas would never leave the Big 12, yet a strong contingent of Texas alums have stated upfront that they have no qualms about leaving that conference.

Note that these views didn’t come from a SharePoint-hosted discussion forum from the McCombs MBA program.  These are comments from sports fans on general purpose and widely read Texas Longhorns message boards who you would think would be the very first ones to say, “NFW R WE GONNA LEAVE THE BIG XII CUZ BIG TELEVEN FOOTBALL IS SLOOOW AND SUX AZZ!!!”  So, if fans like these who are more likely to make comments based on emotion are willing to consider moving to the Big Ten, then you cannot discount the accountants in the athletic department that know that they would receive nearly twice the TV money in the worst case scenario, the faculty that would relish access to CIC research funding, and the administrators at the university that need to balance the financial budget and the interests between sports and academics being extremely interested in a conference move, as well.

The intertwined issues of Texas state politics and what happens to Texas A&M were cited as the single greatest obstacles for Texas in joining the Big Ten.  It would be interesting if what Longhorn Lawyer noted in his comment on my initial index post about making sure that “Texas A&M is taken” care of would mean that, perhaps, the Aggies could head over to the Pac-10 along with that conference’s long-time rumored target of Colorado and turn the West Coast league into its own extremely strong 12-school offering.  I’ll have to amend my 99.99999% probability figure that the Big Ten would not go past 12 schools down to about 95% to allow for the possibility that even if the conference’s revenue needs to be split among 14 schools, getting Texas might be so valuable that if it means that the conference also needs to take A&M (which is a pretty valuable school in and of itself), then it’s more than worth it (as Trashtalk Superstar noted in his own comment).  Add on, say, Syracuse to the Big Ten to kick it up to 14 schools and now you’ve added both the states of Texas and New York to the Big Ten footprint and pretty much as close to a national conference as you can get.  I still think that the Big Ten would much prefer simply adding Texas to keep the conference tight-knit at 12 schools (since most of the gains in that 14-team conference could be achieved by adding only Texas only), so that’s really only a very last resort.

Regardless, here are the real takeaways that I want you to have from these discussions are the following:

A.  Remember the Methodology – The way I assigned values to various schools can be endlessly debated, which is more than understandable.  However, the use of the methodology itself is really what I’m aiming for people to internalize.  When you talk about Big Ten expansion, remember to think like a university president and not like a sports fan, 11 + 1 = 13, and put academics, new TV markets and football brand value at the very top of the list in terms of criteria.

B.  Texas is Legitimately Willing to Leave the Big 12 – Maybe the whole Texas to the Big Ten scenario isn’t likely and political obstacles will get in the way.  However, this whole discussion has proven to me that, at the very least, Texas is definitely willing to leave the Big 12 and, as such, would consider a Big Ten invitation extremely seriously.  This means that I’m not setting forth a completely pie-in-the-sky dream scenario for the Big Ten, as a whole lot of people that aren’t associated with Texas have suggested.  Instead, this is a potential move that is certainly a possibility that would radically alter the college sports landscape.  As a result, it behoove the Big Ten to put effectively all of its efforts into luring the people in Austin (meaning both the university officials and, more importantly, the people in the state capitol).  Maybe Texas can take a whole lot more trips to Pasadena in the future.

(Image from USA Today)

Big Ten Expansion Index Follow-Up #1: Superconferences, Conference TV Revenue and More Reasons Why Texas to the Big Ten Makes Sense

On By Frank the TankIn Big East, Big Ten, Illinois Fighting Illini, Sports59 Comments

I received an incredible amount of great feedback on my Big Ten Expansion Index with comments on the post itself and circulation on various message boards.  This Texas alum perspective was particularly illuminating and indicative that my recommendation for the Longhorns isn’t nearly as far-fetched as a lot of people believe (albeit there are some hurdles).  I’d also like to point to this comment from a Missouri fan that runs his own blog in support of Mizzou’s inclusion in the Big Ten.  It’s a fairly thorough look at Missouri’s qualifications and how they would provide an advantage over the other “usual suspects” such as Pitt – I don’t necessarily agree with all of it but it’s well thought-out.

I’ll take a look at some additional schools that I didn’t initially consider in my original post (i.e. Kansas, Maryland, Miami) in the very near future.  In the meantime, there are a few issues that have been brought up in the expansion discussions that I’d like to address.

1.  Superconferences with 14 schools just aren’t in the cards – I’ve seen a whole lot of suggestions that the Big Ten would look to expand to 14 or even 16 teams in order to turn itself into a superconference.  Supposedly, sources within conference itself even suggested that it might be open to the prospect.  On paper, this sounds like a decent idea – if the goal is to get into as many new TV markets as possible, then having more schools would serve that purpose (particularly when considering the premium that the Big Ten Network places on adding more cable households).

A practical issue, though, is that it’s hard enough to get the current Big Ten presidents to achieve a consensus on one additional school.  So, the thought of them trying to add three more schools at the same time is simply extremely unlikely.

Even more importantly, there are diminishing financial returns for each school that is added after number 12.  The magic of school #12 is that the Big Ten is able to stage a conference championship game at that point, where if it’s worth something close to the SEC version, such game would bring in about $15 million per year.  That’s an instant $15 million pop from that 12th school without even taking into account new regular season TV revenue.  The conference won’t see that type of pop from any additional schools and, in fact, it’s likely that the value of that championship game won’t change with additional members – it’s going to be worth $15 million whether the Big Ten has 12 teams or 14 teams, so each school is obviously going to take in less from that game if the conference goes up to 14 teams.

At the same time, part of the goal for every conference under the current BCS system is to get the maximum allowed 2 BCS bowl bids per season.  The 1st BCS bowl bid is worth $17.5 million to a conference and a 2nd BCS bowl bid kicks in an extra $4.5 million, which is all distributed equally among members in the Big Ten.  The thing is that the Big Ten is already virtually guaranteed to receive 2 BCS bowl bids every year because of the combination of the conference’s large TV markets and top-to-bottom great traveling fan bases in its current 11-team form – no conference has received more multiple bids in the BCS era than the Big Ten (yes, even more than the SEC).  So, every additional school simply dilutes those per school BCS payouts since that revenue is completely fixed.  (Note that this is why any knowledgeable Big Ten fan ALWAYS wants multiple schools from the conference to get into BCS bowls.  Even if your hated rival is the one going to the game, your own school still gets a big-time revenue boost from that extra bowl bid.)  Unless the BCS system (or whatever postseason structure that will govern college football in the future) changes to allow 3 or more schools from a conference to participate, there’s little incentive both financially off-the-field and competitively on-the-field to have a conference that’s larger than 12 schools.

Taking all of that into account and using a historical NBA superstar comparison, if the 12th Big Ten member has to be at least at the level of Kobe Bryant, then the 13th and 14th Big Ten members have to be both Michael Jordan and Wilt Chamberlain.  As a result, the Big Ten isn’t going to say, “Well, we can’t decide between Missouri, Syracuse and Rutgers, so let’s add all of them!”  There’s really only one combination that I could think of where the Big Ten could meet that standard with 14 schools: it adds Texas, Notre Dame AND Miami all at the same time.  Even then, there’s the basketball-esque concern that there are too many superstars involved for everything to work together – a team with 5 Michael Jordans sounds great in theory yet just wouldn’t work practically because a team would implode with that many hyper-competitive egos, while a conference with 6  legitimately elite power schools (Ohio State, Michigan, Penn State, Texas, Notre Dame and Miami) would turn the Big Ten from one of the most brotherly and cooperative leagues into probably the most contentious.

This is a long-winded way of saying that I’m 99.999999% sure that the Big Ten is simply looking for the perfect 12th school and won’t be going beyond that to 14 or more teams.

2.  Big Ten revenue is so incredibly and ridiculously FAR FAR FAR FAR ahead of the Big East and Big 12 that arguments such as “Syracuse and Jim Boeheim love basketball in the Big East too much” or “Texas completely controls the Big 12” are irrelevant – I made this point early in the original blog post, but it still comes up in message board discussions constantly.  So, let’s make it perfectly clear why any Big East school and probably any Big 12 school would leave for the Big Ten.  Here is the annual TV revenue for each conference as reported by ESPN’s Outside the Lines last month along with the average for each school:

  • Big Ten: $242 million ($22 million per school)
  • SEC: $205 million ($17.08 million per school)
  • Big 12: $78 million ($6.5 million per school)
  • ACC: $67 million ($5.58 million per school)
  • Pac-10: $58 million ($5.8 million per school)
  • Big East: $13 million for football/$20 million for basketball ($2.8 million per football school)

Take a look at those figures for a moment – every single Big Ten school makes almost twice as much TV revenue every year as the ENTIRE Big East football conference and even makes more than the entire Big East basketball contract (which that conference’s greatest strength).  There is no rational president of a Big East university that is fulfilling his or her fiduciary responsibility to such university that would turn down an invitation from the Big Ten for any reason whatsoever (whether it’s what the basketball coach says or anything else).  That’s not a personal knock on the Big East (as I’m also a law school alum of Big East member DePaul) but just a simple and glaring reality when you take two seconds to look at the numbers.

At the same time, Texas, which had a best case scenario of having the most nationally televised games and a BCS bowl appearance last year under the Big 12’s unequal revenue distribution formula, still made only $12 million in TV revenue compared to the $22 million that schools like Indiana and (gulp) Illinois received just for showing up.  Every reasonable person knows that even the best programs go through hard times, so it’s not as if though you can count on the best case scenario every single year.  Case in point is the Longhorns’ own rival of Oklahoma, who will receive significantly less money this year for a middling football season after being in the national championship game last year.  Michigan was playing Ohio State for a national championship game berth in 2006, yet look at where the Wolverines are now.  The recent competitive issues at Notre Dame are well-documented.  That means that even a powerhouse school like Texas has to examine where it will be in the event of the worst case scenario when it’s in a conference with unequal revenue distribution, which is something that gives university presidents and athletic directors that have to worry about budgets and state legislatures cutting funding a whole lot of heartburn.  This significant worry would immediately go away in the Big Ten – every school gets that $22 million per season whether they win multiple national championships or lose every single game.

A “winner” under an almost exact replica of the current Big 12 unequal revenue distribution model recently switched conferences for that very reason.  Miami was the single greatest beneficiary under the Big East’s old unequal revenue distribution model, where the Hurricanes received outsized payments from the conference during their national championship runs in the early 2000s.  In fact, the Big East said that it would guarantee Miami more money than the school would’ve received from the ACC for 5 years in an attempt to keep the Canes.  However, Miami’s president and athletic director pointed to the equal revenue sharing in the ACC as the largest financial reason why Miami switched conferences, even if it meant less money in the good times.  What this shows is that university presidents are actually much more concerned about maintaining financial stability during poor seasons than shooting the moon in championship seasons.

What’s more interesting in the Texas situation is that even when it shoots the moon in the Big 12, it still only makes about half as much as the very worst school in the Big Ten.  In that sense, Texas has even more to gain than Miami since the Canes actually knew they were going to give up short-term dollars in exchange for long-term stability, whereas Texas doesn’t have to make that choice – they’re getting more short-term dollars AND long-term financial stability.

At the same time, Texas really doesn’t “control” the Big 12, which is another argument that I continuously see on message boards and blogs.  While it receives the most TV appearances out of everyone because it’s the conference’s top team, remember that the original Big 8 schools have been together for over 100 years and they form a supermajority voting bloc in the Big 12.  Certainly, Texas has clout in the Big 12 due to its national brand name in the same way that Penn State has clout in the Big Ten, but Texas is still the newcomer to the old Big 8 schools and a lot of them (if not everyone except for Oklahoma) are extremely resentful of the Longhorns.  So, the thought that Texas has some type of outsized control in the Big 12 is at the very least overstated.  Remember that Miami had very similar control in the Big East, yet they jumped at the chance to be governed by a bunch of crazy basketball schools based in North Carolina.  “Control” is such an intangible and fleeting notion that it’s unlikely to trump a massive amount of guaranteed revenue whether a school wins or loses.

3.  Traveling fans to road games don’t matter – In terms of sports road trips, nothing tops going to other college campuses.  While pretty much all NFL stadiums are bland outside of Lambeau Field, each college has its own unique feel and traditions.  However, it amuses me when I see comments on various blogs and message boards that say, “Team A won’t leave Conference X because Team A’s fans can’t take road trips anymore.”  Even the best traveling fan bases might send only a few thousand people to road games every week and that school doesn’t see a dime of extra money – under conference revenue sharing arrangements, the visiting school gets the same amount of money whether it sends 1 fan on the road or 20,000 fans.  Therefore, if we think about this for a few seconds, why would any university president prioritize the interests of a few thousand people that like to take road trips yet don’t provide a single extra cent of revenue through such road trips over the school making many more millions of dollars of television revenue while also providing exposure to millions of more people?  Worrying about traveling fans is a classic “penny wise and pound foolish” argument.

4.  Sports team travel costs probably don’t matter – The thought that a school like Texas would worry about the increase in team travel costs in the Big Ten is probably another “penny wise and pound foolish” argument, although I’d love to see if anyone on the interweb has some concrete information about how much these expenses would be.  At a high level, my understanding is that Boston College, whose presence in the ACC would probably be the closest example of being a geographic outlier along the lines of Texas in the Big Ten, is still reaping significantly higher revenue in the ACC that more than compensates for its increased travel costs compared to when it was in the Big East.

Also, distance between schools isn’t necessarily the best indicator of travel costs.  If it’s far enough where you have to get onto a plane (and in the case of Texas, that would be the case for every school that it visits in the Big 12 except for maybe Texas A&M and Baylor), then how far you go on that plane isn’t going to change the costs that significantly (unless it’s a really long-haul trip to a place like Hawaii).  For commercial flights, distance is actually irrelevant – a plane flight from Austin to Chicago could easily be less money than a plane flight from Austin to Oklahoma City despite the much shorter distance since plane fares are more based on the frequency of routes and customer demand.  If an airplane needs to be chartered, the initial cost of procuring that plane is usually fixed where the cost is the same whether you go 50 miles or 1500 miles.  There may be some variance in the cost for fuel and airtime, but it’s still only a marginal increase over the initial cost of chartering that plane in the first place.

Considering that the jump in revenue for Texas going from the Big 12 to the Big Ten would be much larger than BC’s increase in revenue was from the Big East to the ACC, I believe that the increased travel costs (even for all of those non-revenue sports) would not be much of a factor.  If anyone out there has more specific details on this issue, though, please feel free to post it.

5.  Texas A&M is NOT tied to the hip of Texas – Here’s another argument that I’m constantly seeing on blogs and message boards: “Texas won’t go anywhere without Texas A&M.”  If past actions are the best indicators of future behavior, though, then that argument doesn’t hold water because Texas was more than willing to ditch Texas A&M when the old SWC imploded in the early 1990s.  Please take a look at this newspaper article that examines how Texas ended up in the Big 12 which includes interviews with the Texas president at the time of all of the conference moves:

http://www.mysanantonio.com/sports/MYSA081405_3N_SWCbaylor_tech_1ca3e1c_html8528.html

As you’ll see in that article, Texas first really wanted to be in the Pac-10, which meant that the school made the decision that it wasn’t going to be in a conference with Texas A&M.  However, the Pac-10 requires unanimous approval for any new member and Stanford rejected the Texas bid.  After that, Texas approached… wait for it… the Big Ten.  Once again, Texas made the decision to unhitch itself from Texas A&M in that scenario.  While the Big Ten showed interest, the conference had a moratorium on expansion at that time since it had just added Penn State, so Texas was rebuffed there.

It was only AFTER Texas was rejected by the Pac-10 and Big Ten, where in both instances Texas had confirmed that it was more than willing to separate itself from Texas A&M, that Texas coupled itself back with Texas A&M and approached the Big 8 schools.  At that point, the Texas state politicians, who consider football to be of the highest legislative priority, got wind of the plan and forced Texas Tech and Baylor (who neither Texas nor Texas A&M wanted anything to do with) into the new Big 12.

So, let me summarize this for everyone: (1) the current Big 12 was the THIRD choice for Texas after the Pac-10 and Big Ten, (2) Texas would’ve broken away from Texas A&M if either of its first two choices had come to fruition and (3) Texas definitely wanted nothing to do with Texas Tech and Baylor.  Anyone that thinks that Texas is going to make decisions based on whether it can take Texas A&M along with it isn’t looking at how Texas acted during the 1990s conference realignment.  While Texas may care about whether A&M ends up in the SEC, as LonghornLawyer pointed out in his illuminating comment on my previous post, that doesn’t mean the Aggies are anything close to being brothers-in-arms with the Longhorns.

6.  The revenue gap means that the Big Ten now trumps the Pac-10 for Texas – That historical article brings up another common argument that Texas might look to the Pac-10 instead, especially since it was the school’s first choice back in the 1990s.  This is certainly a fair point, although the revenue situation has changed so drastically in the Big Ten’s favor that a reasonable person is going to weigh things a lot differently today.  Take a quick look back at the conference revenue figures back in point #2 and you’ll see why Texas isn’t going to value the Pac-10 over the Big Ten as of today: the Pac-10 has even worse TV revenue than the Big 12.  Even if we acknowledge that the addition of Texas were to give a boost to Pac-10 TV revenue, it still wouldn’t come close to more than quadrupling that number which would be required to merely match what the Big Ten makes today (and note that the Big Ten figure would directly increase by a significant margin just from the addition of Texas state basic cable households for the Big Ten Network).

Also, putting money matters aside for a moment, there’s a pretty practical issue with respect to Texas being in the Pac-10: the time zone.  Most people east of the Mississippi River probably think of Texas as a “western” state.  However, it’s in the Central Time Zone (just like 5 of the 11 Big Ten schools).  This matters because prime time starts at 8 pm in the Pacific Time Zone (just like the Eastern Time Zone), which means that prime time games in the Pac-10 wouldn’t start until 10 pm Texas time and that’s simply a killer for TV purposes.  There are no such time zone issues with the Big Ten because all of the schools are either in the Central or Eastern Time Zones.

I know that I’ve put together some incredibly long blog posts, but just remember my two overarching rules of thinking like a university president as opposed to a sports fan and that 11 + 1 = 13.  The Big Ten didn’t come out and talk about expansion to do anything other than a blockbuster move.  If that blockbuster move isn’t available, then the Big Ten will stay at 11 schools.  I’ll be back soon with another post on additional expansion candidates.

(Image from NCAA Football Fanhouse)