From the moment that the Big Ten announced its intentions to expand three years ago, my attention immediately focused upon “What would be best for the Big Ten Network?” as what would be most critical. When I kept seeing the media speak about rivalries, geography and on-the-field competitiveness as opposed to the BTN, I wrote the “Big Ten Expansion Index” post as a business-focused response that brought a lot of new readers to this blog (including many that are still commenting here today) since it came to the then-provocative conclusion that it was Texas (not Notre Dame) that would be the conference’s top target.
One of those readers ended up determining the Big Ten’s way of thinking better than anyone. Back in April 2010, when massive conference realignment was still in the speculative stage and nothing had actually occurred, a reader named Patrick, who is long-time television industry veteran, sent in an analysis of how much various Big Ten expansion candidates would be worth to the Big Ten Network. He went beyond simply looking at market sizes and cable subscriber fees and took into account fan intensity (which translates into the ability to charge higher cable subscriber fees in specific markets), national TV value and advertising rates. In no surprise, Texas finished at #1. However, look at who were the next three highest ranked schools after the Longhorns:
|CANDIDATES||TOTAL ADDED REVENUE ESTIMATE|
|Rutgers WITH NYC||$67,798,609|
Well, on the heels of the Big Ten inviting Nebraska a couple of years ago, Maryland has agreed to join the conference and Rutgers will likely be announced as a new member on Tuesday. As a result, it turns out that we can proclaim Patrick as the Nate Silver* of Big Ten expansion. As you can see from that post, most of my takeaways from Patrick’s analysis at the time were more Armageddon-like (particularly with respect to Notre Dame) and completely wrong (as I had assumed that the ACC wasn’t poachable), but his calculations did convince me that Nebraska, in spite of its small market, was going to be a lock for a Big Ten invite over anyone else (and that turned out to be correct several months later) since that Rutgers number was (and still is) much more speculative and it was crystal clear that the Cornhuskers would be more valuable than the other standard candidates mentioned at the time such as Missouri and Pitt.
(*Speaking of Nate Silver, it’s interesting to look back upon this piece that he wrote about conference realignment last year in the New York Times. The data inputs that he used might be a bit flawed compared to the polls that he leveraged for the 2012 Presidential election, but it shows at least the argument as to why the Big Ten would look to add Rutgers.)
Essentially, the Big Ten executed a two-pronged strategy with its expansion: get a marquee football program at the national level (Nebraska) as a headliner and add top academic flagships at the regional level (Maryland and likely Rutgers) for depth. As much as fans want every expansion move to be as sexy as adding Nebraska, the reality is that pretty much all of the conference realignment moves in the power conferences were about depth as opposed to headlining. Texas A&M being added by the SEC was probably the best pure football move from a fan perspective in the last three years outside of the Big Ten expanding with Nebraska, but even then, the draw of the Aggies was predominantly about the SEC getting into the state of Texas for TV purposes (as they will likely have their own conference network coming together sooner rather than later).
The notion of a “Midwestern conference” is over for the Big Ten just as the notion of a tight Southern-based conference has long been over for the ACC ever since it decided to add Boston College (along with Miami and Virginia Tech) in 2003. As Teddy Greenstein noted in the Chicago Tribune, the addition of Rutgers and Maryland is a long-term play for Jim Delany and the Big Ten driven by demographics. Arguably, the Big Ten has been in the worst position of any of the power conferences when looking at long-term population trends, as the SEC, Pac-12, Big 12 and ACC all have large presences in fast growing Southern and/or Western states. The additions of the states of Maryland and New Jersey mitigate that a bit while still not going completely expanding with geographic outliers. It also doesn’t hurt that these are both recruiting rich states (at least by Northern standards) for football and basketball. For the Big Ten fans that bemoan the loss of “Midwesterness”, the demographic makeup of the league was legitimately something that had to change regardless of the presence of the Big Ten Network or TV dollars. Maryland and Rutgers may not be very exciting additions in 2014, but they’ll be extremely important for the long-term health of the Big Ten in 2024 and beyond.
With respect to those TV dollars, as I stated in my post on Saturday, I unequivocally believe that Maryland can deliver the Washington, DC/Baltimore region for the Big Ten Network (and when I say “deliver”, I mean basic carriage at a high “Big Ten footprint” subscriber rate as opposed to the sports tier and/or lower out-of-footprint rate). That’s why this expansion hinged upon Maryland accepting since they are considered to be a sure thing business-wise. The real all-in bet for Jim Delany and the Big Ten, though, is with the addition of Rutgers. Judging by the media commentary and Twitter reactions, there is a healthy skepticism out there about whether Rutgers has the ability to deliver the New York City market, which I agree with at a certain level and have pointed out on this blog numerous times. This is definitely not a slam dunk by any means.
However, I also don’t believe the Big Ten is naive enough to think that it is just about Rutgers alone delivering that market. Instead, the conference is likely banking on the immediate geographic presence of Rutgers combined with the large number of other Big Ten alums living in the New York City metro region (particularly from Penn State, Michigan and newly-added Maryland) to gain just enough traction to make it viable. If you have read Malcolm Gladwell’s “The Tipping Point”, the Big Ten is betting that the network effect of Rutgers being added to all of the existing Big Ten alums in the Tri-State area will have a greater impact than Rutgers alone (or Rutgers combined with the various past and present members of the Big East). I’m not saying that this will definitely work – this is big-time risk for a conference that isn’t known for big-time risks. The main point is that this move is not just about what Rutgers alone can deliver in the New York City market, but rather what Rutgers plus all of the other Big Ten fans in that region can deliver just enough there. No one in the Big Ten is expecting New York sports fans to follow college football like people in Birmingham – the percentage of fans that need to be interested in college sports in that market for the conference to garner the value it needs there is much lower than anywhere else.
Some other thoughts:
- As much as a lot of people have pointed out the “cultural differences” and geographic distances between Maryland and the rest of the Big Ten, this is a fairly mild change on those fronts by conference realignment standards. In terms of being a large research institution with excellent academics, Maryland fits in very well with the Big Ten as a school. At the same time, Maryland won’t exactly be sticking out like a sore thumb in the league, especially with Rutgers being added at the same time and Penn State being in a contiguous state. This is nowhere near the cultural and geographic differences between West Virginia and the rest of the Big 12 or the current-football-setup-that’s-about-to-change in the Big East.
- Despite my belief that Maryland would have been foolish to turn down an invite from the Big Ten, I still continue to think that the ACC is stronger than people give it credit for. The fact that Maryland is leaving doesn’t mean that it’s going to spark an exodus from the ACC overall, particularly with respect to never ending speculation that Florida State and Clemson would consider jumping to the Big 12. There are two key differences between the Maryland situation and the Florida State/Clemson scenario: (1) outside of money, Maryland is moving to conference that it still fits into as an overall institution without insane geography issues, whereas FSU and Clemson have no real connections at all to the Big 12 and (2) when looking at the money, Maryland is going to receive a LOT LOT LOT more of an increase in TV rights fees by moving to the Big Ten than FSU and Clemson would receive in the Big 12. Pete Thamel from Sports Illustrated pointed out that the Big Ten is anticipating $30 million to $35 million per school per year in just TV money when it enters into a new deal in 2017… and this appears to be a low end estimate that assumes that there won’t be full BTN carriage in markets covered by Maryland and Rutgers. (If the Big Ten Network can get a full in-market rate in the NYC and DC markets, then those numbers are going to go up even further.) The current ACC contract with ESPN that runs through 2027 will pay out an average of $17.1 million per school per year, which means that Maryland is looking at a 100% increase in TV rights money as a conservative estimate. Contrast this with Florida State and Clemson, where they’d be looking at a bump up to $20 million per school per year in the Big 12’s national TV deals plus whatever they’d be able to garner for third tier TV rights locally. That’s not an insignificant amount of money, but likely not enough considering that there would be much worse cultural and geographic headaches compared to the Maryland move that will yield far more revenue for the Terps. Therefore, my semi-educated guess is that the ACC doesn’t lose anyone else in the near-term.
- Assuming that what I just said about the ACC only losing Maryland holds true, I continue to firmly believe that UConn is going to end up as the Terrapins’ replacement. From a pure football and even overall athletic department perspective, Louisville is probably the better choice for the ACC, but the league is still one that considers institutional fit and academic profile as being extremely important factors in expansion. Connecticut is in alignment with the ACC on such factors in a way that Louisville isn’t and, when looking at the ACC’s long-term vision, the Huskies match what the league is looking for in terms of getting into the Northeast as much as possible. The network effects that apply to Maryland/Rutgers/Penn State for the Big Ten can also apply to UConn/Syracuse/Pitt/Boston College (albeit that’s effectively going back to the old Big East).
- That leaves Louisville likely praying for the Big 12 to get antsy. Chip Brown of Orangebloods has stated that the Big 12 isn’t looking to move off of 10 teams for now and I tend to believe him in the short-term. However, as much as we parse objective TV revenue and demographic data in conference realignment, there’s also a subjective psychological element of “bigger means better” that has been permeating throughout the land. So, let’s say that it’s about a 60% chance that the Big 12 doesn’t expand within the next few years and a 40% chance that it goes up to 12 (with Louisville being the top target, BYU likely getting consideration, and schools like Cincinnati and USF begging to get in). That’s up from a 90/10 split prior to the latest Big Ten expansion news, so we’ll have to keep an eye on the Big 12. (As I’ve noted earlier, I still don’t buy any ACC schools moving to the Big 12. If anything, it wouldn’t shock me if Texas goes independent and strikes a Notre Dame-type deal with the ACC by the end of this decade.)
The crazy thing is that we’ve only touched the surface here, as the likely defections of Rutgers and Connecticut will leave the Big East searching for new members once again (or maybe preventing Boise State and San Diego State from heading back to the Mountain West or the Catholic non-football members from splitting). Assuming that Rutgers announces that it’s accepting an invitation to the Big Ten tomorrow, I’ll have more on what the Big East can and/or should do at this point along with the trickle down effect on all of the other conferences.
Until then, welcome to the Big Ten, Maryland!
(Image from Testudo Times)