Big 12 Now Could Help Position Big 12 For Future Of Content Delivery
By WENDELL BARNHOUSE
The Big 12 Conference is preparing for its 25th anniversary in 2021-22. That will be about a decade after the conference was in ICU in critical condition.
The Big 12 was formed because of conference realignment and the resulting scramble to have enough clout to negotiate lucrative television contracts. It was a shotgun wedding between schools from two dying conferences, the Big 12 has needed constant marriage counseling. This decade featured four departures, two additions and one brush with extinction.
Its near-death experience nearly 10 years ago resulted from the same forces. There’s plenty of irony that about the time the Big 12 will be bathing in the celebrations of a silver anniversary, it will likely be in the early stages of negotiating new television deals.
Its current contracts with ABC/ESPN and Fox expire in 2024-25. That’s also when the 13-year grant of rights with member schools expire. That grant of rights was significant when originally signed because it essentially handcuffed schools to the league for the length of the deal.
The cable television industry has vastly changed since the deal was signed. Content is being delivered via streaming, which is the new frontier. Many viewers under the age of 30 have “cut the cord” and dropped cable.
According to the research firm eMarketer, 19.2% of households will cancel cable in 2019. Cable subscriptions are down to 86.5 million compared to 100.5 million five years ago. The trend could soon lead to more homes not having subscription TV to those that do.
In a few years when the Big 12 – and most of its fellow Power Five colleagues – start to renegotiate new TV deals – few know what the market will bear and even fewer will know what the market will look like.
“Anybody who tells you they know what the media landscape looks like three years from now is delusional,” Big 12 commissioner Bob Bowlsby said. That quote about “delusional” has been a go-to for Bowlsby.
If nothing else during its lifetime, the Big 12 has been a reactive instead of a proactive conference. Its seemingly endless jealousy and squabbling made it difficult to reach a consensus.
Remember this: Around 2007-08, then commissioner Kevin Weiberg pitched the membership on starting a Big 12 Network. No other conference had its own network. The league, with members Texas, Texas A&M, Oklahoma and Nebraska behaving like toddlers fighting over treats, declined the idea. Weiberg soon resigned and left for the Big Ten Conference … where he helped start the Big Ten Network, which is currently helping that 14-team league make more money than any conference.
While most of the acrimony is absent, the Big 12 is trying its best to be visionary through the delusion.
The Atlantic Coast Conference debuts its network later this month, leaving the Big 12 as the only Power Five league without its own network.
(Sidebar note: When the ACC announced in 2016 its plans to start its network, that panicked the Big 12 into the folly of an expansion beauty pageant that ended a few months later. The expansion dog and pony show was helmed by bombastic OU president David Boren, who has since left that job. Keen observers note that since Boren’s departure, the Big 12 has been sailing in smoother waters.)
The ACC Network comes online at a time when a cable-delivered network is as relevant as black-and-white TVs. While other conference networks have faced initial challenges in signing deals with cable companies, eventually the lure of the product – especially football and men’s basketball – proved irresistible.
That “inventory” (games) is where the Big 12 is at a disadvantage (in Boren Speak, a “psychological disadvantage). The most league games available on a Saturday is five. The SEC, Big Ten and ACC all can offer seven. In order of importance, those leagues can afford to put the bottom feeders on their cable networks. If the Big 12 had a network, at best it could offer up one game that wouldn’t be aired by one of its TV partners.
Oklahoma athletic director Joe Castiglione doesn’t rule out the possibility of a Big 12 Network but the winds of change regarding delivery systems appear to be blowing in the other direction.
“No, I don’t think we’re past that point,” he told The Athletic when asked about a Big 12 Network. “It’s just not as likely. You’d have to step back and think, ‘Oh, what we would do to make that happen?’ And right now, our approach seems to be working very, very well.
“It’s actually been a very good evolution for Big 12 without a conference network. I understand people might say we’re unlike other conferences, and to some degree we don’t have a 24/7 approach to getting lots of other events on. But in terms of the events that we have currently available in our media contracts, they’re getting significant distribution.”
The first question asked of Bowlsby during his podium time at media days was about expansion. He wryly noted that type of question has been the first asked for the last seven consecutive years. There was reason for that curiosity in years past, but there is no Big 12 expansion (which would grow its TV inventory) on the horizon. The only membership changes will occur if there are seismic shifts elsewhere ignited by the next round of network negotiations.
While the Big 12 doesn’t have its own network, it still distributed $38.8 million per school in revenue from last season, a 6% increase. Big 12 schools retain their “third-tier” broadcast rights, which schools in leagues with networks must give up. That means that Texas banks an additional $15 million from The Longhorn Network while Oklahoma’s third-tier agreement with Fox brings in a reported $8-10 million annually. That puts both schools on par with what schools in the Big Ten and Southeastern Conference earn.
For the last 20 or so years, each time a conference has signed a new TV deal, the value in that contract has increased. Schools in those conferences have benefited and their revenue shares from their leagues have increased (Big 12 schools’ revenue shares have nearly doubled during its current TV deals).
If in the next round of negotiations, the cable cutting has reduced the amount of money ESPN or Fox can spend, streaming services might help bridge the gap. And this is where the Big 12 hopes that it is on the cutting edge.
Big 12 Now will be the conference’s new digital network on ESPN+ which can be purchased for $4.99 per month or $49.99 per year. It will be available on Apple TV, Android devices, on Roku, ChromeCast, FireTV, Xbox One, PlayStation 4, Oculus Go and all new Samsung TVs.
“This technology is up and running,” Bowlsby said at Big 12 media days last month. It's easy to subscribe to and it's cutting edge. It is very much anticipatory of what tomorrow's technology environment is going to look like. AT&T has recently made a $100 billion investment in Time Warner and the essence of their strategy is aggregation of assets delivery by streaming. That is their bet.”
The Big 12 announced the ESPN+ deal a few months ago. It could help position the league when or if streaming services become The Next Big Thing in delivery services.
“This is really a conference taking a step toward where we all believe the future is going,” said Nick Dawson, ESPN vice president of programming and acquisitions. “I commend them for that, because I think some people can look at this as risky or the non-traditional path to follow.”
ESPN+ would be a quasi-Big 12 Network. Texas and Oklahoma retain their current deals but the other eight schools’ third-tier rights will fold into Big 12 Now with the only time the Longhorns and Sooners appearing would be during their road games. Bowlsby said that over 800 Big 12 events could appear on the streaming service.
Does this mean that Your Veteran Scribe and us other old fogeys will be watching Texas-Oklahoma on our tablets or smart phones?
No. Emphatically. No.
“We’re not abandoning cable,” Bowlsby said. “We’ve got two partners (ESPN and Fox) paying us a lot of money for content and that’s not gonna change. But when I speak to college kids, I ask how many have cable and a land-line phone. None of them have a land-line phone and only a third have cable. Over time, content is gonna migrate.”
The current networks will still carry the Big Events. Streaming, for the foreseeable future, is merely an auxiliary carrier that provides another revenue stream. Whether that stream ever becomes a gushing torrent is yet to be seen.
At the Big 12 spring meetings, his last as chairman of the Big 12 board of directors, West Virginia president Gordon Gee pumped the sunshine.
"Our model has agility," he said. "And I think that right now, I'd much rather be a ballerina than an elephant. I think that's where we are right now. I think we are the ballerina of the five top conferences. And I think that is a real strength for us."
Reminded of Gee’s “ballerina” comment, Bowlsby laughed. Anyone who is optimistic that the Big 12 will celebrate a 50th anniversary in 2046 has to hope he’s not laughing to keep from crying.
”We think we’re on the right side of technology and we’ve got the right partners to make this something special,” Bowlsby said. “Right now, it’s a flirtation and an experiment that I think will be a really good investment. The best position for us in 2024-25 to be in an auction environment where there are a lot of suitors.”