Numbers Can Show What You Want, But Seven Pac-12 Teams Topping Cowboys on TV?

GumbyFromPokeyLand said:

---

The ACC is not riding their GOR agreements. If anyone is riding those agreements it's (1) ESPN with a binding tv deal until 2036, and (2) the 8 or 10 ACC schools that are not likely to be coveted by other conferences. Absent something like a new CFP format that excludes the ACC, the GOR agreements will remain valid and binding for all 14 member schools through 2033, earliest.

---

you're wrong, you're always wrong.

I have no idea whether the ACC GOR will remain valid, but not all 14 teams will still be in the conference if the media money is not sweetened considerably, it's called a buyout. I've already offered a pizza bet with you over that issue.

it is 100% impossible to determine the fiscal impact of remaining in the ACC versus bolting for another conference, especially after 4-5 more years, when such a move could become more likely than it is now. As time goes by, the total buy-out decreases, and as the other conferences sign contracts that define how much further teams will fall behind.

CaliforniaCowboy said:

---

GumbyFromPokeyLand said:

---

The ACC is not riding their GOR agreements. If anyone is riding those agreements it's (1) ESPN with a binding tv deal until 2036, and (2) the 8 or 10 ACC schools that are not likely to be coveted by other conferences. Absent something like a new CFP format that excludes the ACC, the GOR agreements will remain valid and binding for all 14 member schools through 2033, earliest.

---

you're wrong, you're always wrong.

I have no idea whether the ACC GOR will remain valid, but not all 14 teams will still be in the conference if the media money is not sweetened considerably, it's called a buyout. I've already offered a pizza bet with you over that issue.

it is 100% impossible to determine the fiscal impact of remaining in the ACC versus bolting for another conference, especially after 4-5 more years, when such a move could become more likely than it is now. As time goes by, the total buy-out decreases, and as the other conferences sign contracts that define how much further teams will fall behind.

---

Do you have any earthly idea how much it would cost a school to buy out of the conference?

I don't think you do.

GumbyFromPokeyLand said:

---

Do you have any earthly idea how much it would cost a school to buy out of the conference?

I don't think you do.

---

Try reading what I wrote, then get back to me.

SMH.

buy out of the ACC when? I said not before the other media deals are signed and in place, and the ACC network matures (about 4-5 years).

Do you have any earthly idea how much it would cost a school to NOT buy out of the conference if they are falling behind by more than double the amount than they are making by staying?

I don't think you do.

come on man, this stuff is not that hard to follow.

CaliforniaCowboy said:

---

GumbyFromPokeyLand said:

---

Do you have any earthly idea how much it would cost a school to buy out of the conference?

I don't think you do.

---

Try reading what I wrote, then get back to me.

SMH.

buy out of the ACC when? I said not before the other media deals are signed and in place, and the ACC network matures (about 4-5 years).

Do you have any earthly idea how much it would cost a school to NOT buy out of the conference if they are falling behind by more than double the amount than they are making by staying?

I don't think you do.

come on man, this stuff is not that hard to follow.

---

Let me help you out.

To exit the ACC a school would owe an exit fee of 3x the previous year's distribution plus either forgoing media revenue through 2036, or, buying out the GOR. Let's assume a school is prepared to buyout the GOR. If you escalate projected 2021 league revenues of $31mm/school at 6% per year through 2036, then discount the future media revenues (beginning in 2021 at $35mm/yr) at 6%, the Present Value of the buyout number would be:

2023 - $616mm
2024 - 611
2025 - 603
2026 - 593
2027 - 579
2028 - 560
2029 - 539
2030 - 512
2031 - 480
2032 - 442
2033 - 398

That's the starting point for negotiation and assumes the rest of the ACC would be willing to accept a new tv deal without one or more of their most valuable teams leaving. Even if I've over-estimated by 50-75%, no school could begin to afford that kind of cash payment, much less foregoing media revenue through 2036.

The ACC and all the schools in the ACC are screwed.

GumbyFromPokeyLand said:

---

CaliforniaCowboy said:

---

GumbyFromPokeyLand said:

---

Do you have any earthly idea how much it would cost a school to buy out of the conference?

I don't think you do.

---

Try reading what I wrote, then get back to me.

SMH.

buy out of the ACC when? I said not before the other media deals are signed and in place, and the ACC network matures (about 4-5 years).

Do you have any earthly idea how much it would cost a school to NOT buy out of the conference if they are falling behind by more than double the amount than they are making by staying?

I don't think you do.

come on man, this stuff is not that hard to follow.

---

Let me help you out.

To exit the ACC a school would owe an exit fee of 3x the previous year's distribution plus either forgoing media revenue through 2036, or, buying out the GOR. Let's assume a school is prepared to buyout the GOR. If you escalate projected 2021 league revenues of $31mm/school at 6% per year through 2036, then discount the future media revenues (beginning in 2021 at $35mm/yr) at 6%, the Present Value of the buyout number would be:

2023 - $616mm
2024 - 611
2025 - 603
2026 - 593
2027 - 579
2028 - 560
2029 - 539
2030 - 512
2031 - 480
2032 - 442
2033 - 398

That's the starting point for negotiation and assumes the rest of the ACC would be willing to accept a new tv deal without one or more of their most valuable teams leaving. Even if I've over-estimated by 50-75%, no school could begin to afford that kind of cash payment, much less foregoing media revenue through 2036.

The ACC and all the schools in the ACC are screwed.

---

those numbers are complete nonsense (if this, if that, 6% out of thin air ... SMH), and you neglected to include how much they would be falling behind by continuing to accept that level of mediocrity.

The whole dang conference could collapse by then, why would any of them consciously decide to continue like that? You don't know.

My conjecture would be that the ACC remains viable with new contract money (before the end of the 2036 contract). They are the 3rd best conference and the media companies simply cannot afford to have a league like that fail.

That post was about as goofy as what MrMcC posts over on the hate board.

I said I'd bet you a pizza. Crickets chirping.

Ron, clearly you don't know how buyouts are reached. I have years of experience of valuing streams of cash flows. Even if their current cash flows are flat, the buyout in 2023 is over $400mm, and over $200mm in 2033.

What would cause the ACC collapse? Thay can't get a new TV contract. ESPN loves the ACC deal. It's the cheapest content in sports. Why would 8 or more schools with no prospect of a new home vote to disband without a new P5, or P4, P3 home? They wouldn't.

Think I'm wrong? Ask NJ

GumbyFromPokeyLand said:

---

Clearly you don't know how buyouts are reached. I have years of experience of valuing streams of cash flows. Even if their current cash flows are flat, the buyout in 2023 is over $400mm, and over $200mm in 2033.

What would cause the ACC collapse? Thay can't get a new TV contract. ESPN loves the ACC deal. It's the cheapest content in sports. Why would 8 or more schools with no prospect of a new home vote to disband without a new P5, or P4, P3 home? They wouldn't.

Think I'm wrong? Ask NJ

---

future value and cash streams are not rocket science.

You have no freaking idea what ESPN would or would not do. None. Anything could happen.

you'd argue with a fence post. nothing is locked in stone. Everything is negotiable.

I'm curious where you developed this attitude that nothing can change in college football contracts. Ever.

Who said it would be 8 or more schools, it could be ALL OF THE SCHOOLS. Some might get considered for other conferences, but with the right deals they could just as easily stay where they are.

ESPN likely does not intend to make any of their "product" become obsolete or inferior, that is simply bad business.

I don't need to ask anybody, it's common sense.

frankly, I think discussions about breaking the GOR are moot anyway because the ACC won't be left behind financially.

I don't think they have to pay $400M. They can get those for less than that. All of those schools had asked to come in at less than a full share, and that is how they are going to get in.

If they are willing to take a 50% share, the PAC and B12 are screwed.

I didn't say you did say anything about USC. I said you would have had I brought those conversations over here. I'm very selective with what I post here because I know Robert and many of the readers don't like the full rumor mill, and frankly you have to discern through a lot to get any info. But USC to B1G was a major conversation for much of the year way before it hit the new and facts were known. And many of those you disparage were in front of that story.

You want to dismiss Jason Scheer, but he has said multiple times on radio that he has seen/heard the numbers from UA people and it's $245M a year for the league. I think he's credible and the fact that first the P12 begged for a merger, then went on a media attack spree against the B12 says he's putting out the truth. You have to judge information and use it when it is the best you can get.

While things posted in speculative articles by sports journalists are not guaranteed, they give a read of what is being discussed and thought at any time. And with any large and complex group of agreements and events there is no straight clear path. So sometimes you have to look at what is currently being considered even if if it could change drastically tomorrow.

I have no fear of facts, but when facts are unknowable I'll try to find what I can that is logical.

Yeah a buyout would do it. However right now that would be in the range of $500M and so no one can do it. I'd say come 2030 or so someone may feel they can tackle it IF the B1G or SEC wants them.

We're not because they don't want the schools most likely to come our way even at P12 pricing.

I figure its only a matter of time before the top end schools start wanting all the Illinois & Mississippi States to also take less money to stay in the leagues. They've become obsessed with UT disease: They claim they had to pay for all the underperformers and they want their money, never realizing that without those schools they abused and forced into poor positions to prop up their chest beating were the basis for their claims to glory.

I do think its bad news for the P12, but I don't see it having much effect on the B12. We'll add a few of those left if they make sense.

NJAggie said:

---

We're not because they don't want the schools most likely to come our way even at P12 pricing.

I figure its only a matter of time before the top end schools start wanting all the Illinois & Mississippi States to also take less money to stay in the leagues. They've become obsessed with UT disease: They claim they had to pay for all the underperformers and they want their money, never realizing that without those schools they abused and forced into poor positions to prop up their chest beating were the basis for their claims to glory.

I do think its bad news for the P12, but I don't see it having much effect on the B12. We'll add a few of those left if they make sense.

---

Who is "we" and "they" in your first sentence?

If the B1G takes the 4 PAC teams, the SEC will certainly counter with some type of expansion. Whatever form the B12 takes thereafter will be much farther than a distant 3rd to 2 20-team mega-conferences in terms of financial rewards, credibility and visibility. In that case, I don't see any way the SEC or B1G would agree to the B12 (regardless of who they add) getting an automatic qualifier to a new CFP format.

I do think the SEC may entertain uneven sharing, especially if the B1G does so and the SEC invites more teams. I hear the ACC may be looking into it.

The Big 12 is we, and the B1G is They.

I don't see any SEC move being made for PAC schools so it has no impact. And I don't see the SEC taking anyone until they can crack the ACC IF there are any schools in that league that make the grade.

NJAggie said:

---

The Big 12 is we, and the B1G is They.

I don't see any SEC move being made for PAC schools so it has no impact. And I don't see the SEC taking anyone until they can crack the ACC IF there are any schools in that league that make the grade.

---

If the B1G takes Ore, Wash, Cal and Stan, the SEC will want to get to 20, likely drawing from the B12.

I've listened to multiple national shows (limited to the guys that understand the real impediment the GOR presents) that think there is no chance the SEC can get an ACC school in the next 10 years.

If the B1G goes to 20 its because it makes sense for them to add enough West Coast teams for scheduling, inventory, and territorial control. Those are valid reasons to expand. In fact taking those 4 will probably mean they have a lesser per team payout as those schools are each valued at less than half of the B1G per team value now. In fact I think they really only want Oregon & Washington, but are willing to take Cal & Stanford, because they need that to get the Presidents to feel it's about academics and not football.

If they do there's no reason for the SEC to match that unless there are 4 schools that bring enough dollars to get them equal to or ahead of the B1G. Or, some group of schools that give them some special option like control of a time zone. There's no one school available outside of ND that can be an equal share addition, and the rest are going to be dilutive. There's no group of schools that add a region for value. The SEC has no compulsion to match numbers, they'll wait until there is a school that has value to them.

I hear that matching numbers, or putting out number of teams as THE GOAL. It's not. there's no money in numbers by themselves, it has to be numbers that matter in the form of schools that add value equal to or greater than you're currently getting. They aren't coming for Big 12 or PAC 12 teams, there just aren't any that add enough value.

The B1G adding Cal and Stanford is not about value, not about scheduling and not about quality. If scheduling was a real factor, they wouldn't be sitting with only 2 west coast teams right now. I can see it might be about inventory or time-slot domination or academics. If the SEC expands it will be about perception and quality and maybe inventory. The B1G is big on academics. The SEC is big on quality, neither of which necessarily brings value. The SEC could grab 2 or 4 B12 teams (better than UCLA, Cal and Stanford) to enhance their quality and further bolster their perception as the premier league in college football. Don't discount the SEC's unquenchable need to dominate both on field quality and the national narrative.

Also, when the time comes for a new CFP, I would think the SEC doesn't want to be sitting at the table with 16 teams while the B1G is sitting there with at least 20 and maybe 21 or 22 if the B1G can lure ND. The SEC knows they're not getting ND, so they probably feel they have to add something to offset the real possibility ND and their quality winds up in the B1G. The fight over the ACC teams won't begin for another 10 years.

Numbers are immaterial in the CFP as you vote by conference.

Reread what I wrote, Stanford & Cal are tag alongs to get the Presidents to vote for all 4 coming in so they get the two they want. As they need more than 2 schools on the West Coast for scheduling purposes. It also saturates the market, and they get more cable subs in North CA than they do in either WA or OR.

The SEC does not have any 4 schools in the Big 12 they could grab that would get them anywhere near that so they'll wait until the ACC schools are available.

I guess we'll have to agree to disagree.

I know they vote by conference. But who and how many are in each conference impacts what's proposed and what's agreeable. For example, you think the B12 is gonna like what the B1G prefers as a new CFP format if the B1G has 22 teams and the B12 has only 12? The B12 with only 12 because they're hellbent on adding only teams that add value?

Value isn't the only consideration - the B1G is about to prove that. There are other considerations and the SEC is not gonna play second-fiddle for 10 years.