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MEGA Conference Realignment and lawsuits Megathread: Stories, Tales, Lies, and Exaggerations

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Handsome Squidbum said:
Many here have characterized joining the Big 12 as a death sentence and we should avoid it at all costs. How can you say that is that a viable option? It’s either SEC or B1G for many. SEC isn’t interested. So that means one option. And also this isn’t the conversation we were having 4 weeks ago. That was just pure speculation. Now Flo is confirming what I thought- we weren't being quiet because Rad was playing 4D chess, it was because we didn't have a spot in the B1G and needed to keep all options open. Now the options look like partial shares in the B1G or full shares in the Big 12. It sounds like the UM brass is seriously considering the Big 12, so I'm guessing the pro/cons they are looking at are the same ones I've described.

When it's full shares vs full shares, B1G is the obvious decision. When it's partial shares vs full shares, it's a tougher decision. You talk about recruiting and perception- when Washington and Oregon got paired up going into the B1G, they both took partial shares so they are in the same boat. If we go in with partial shares and FSU gets full shares, how do you think that perception plays out? FSU is our biggest rival for recruits- you don't think FSU will say that UM is obviously a 2nd tier program as the conference had such a low opinion of us that it didn't give us full shares?

As for the Big12 being a 2nd tier conference, it clearly isn't on the same level right now with the P2. I will however point out something they are doing well. Credit where credit is due. I have to say I'm extremely impressed with the Big 12 commissioner. Everyone said the Big 12 was dead after Oklahoma and Texas announced they were leaving, but somehow he managed to get a massive increase payout from the networks. You can't underestimate elite leadership. Big 12 has all sorts of flexibility- deals with both networks, streaming, etc. that the new commissioner negotiated that the P2 don't have because they are behemoths. If I'm UM, I'd at least hear him out. Maybe he has roadmap to get the Big 12 almost as much money as the B1G- by pulling in the best remaining ACC schools (UM, VT, GT, Louisville, Pitt) and signing streaming deals with Netflix or Amazon to give them exclusive rights to certain games.

Remember that just a few years ago the Pac12 was patting itself on the back, and signed a media deal that paid the Pac12 teams more than the SEC or B1G teams were getting (21 million per team to Pac 12 compared to 18 million of P2)
www.bcinterruption.com

Comparing The ACC's TV Deal To The Other Five BCS Conferences

Comparing the ACC's TV deal to the other five BCS conferences. We can't exactly claim poverty here, but ...
www.bcinterruption.com www.bcinterruption.com

But like Swofford, the PAC 12 Commissioner was a moron who ended up killing his conference. The Big 12 commish is earning his paycheck. Let's say he sits down with UM and says, "Here's the 5 year plan, with a combination of streaming and network deals, that gets each team in the Big12 nearly as much the P2. You get full shares from the start and will be the golden child for our conference." You'd have to be incredibly myopic not to consider it.
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I can imagine a scenario, unlikely as it may be, where the big12 becomes part of a P3.

Conversations with the financial backers of teams like UM, TCU, SMU, OK St, UCF, etc may sound like "If you want this conference to thrive prepare to make up the diff in tv contracts/ NIL support until we are on equal footing to demand a similar pay out from the networks."

I think leaders would point to our time of dominance in the Big east as an argument for this choice. I think that's a mistake we shouldn't be looking back we need to look forward. Stop trying to recapture the magical underdog story and just try to take advantage of our history to settle into a spot among the elites.

A move to the big12 is a big gamble while atm it seems any move to the P2 would require a period financial inequity.

Either way looks like our boosters are going to be on the hook to help us keep up, so why gamble?
 
Empirical Cane said:
We have porsters who keep pointing this out, and yes, Miami has had 20 years of being removed from the Natty conversation.

That aside, is Miami a less valuable member to TV revenue than Illinois? Iowa? Northwestern? Kentucky? Vanderbilt? Rutgers? Maryland? Any of the other bottom tier SEC/B1G members? Those conferences are a few top teams amd then nobody else in terms of true revenue generators on a national scale. There is too much competition for people's limited cognitive ability to consume. From that lens, I believe the network lizard overlords would replace many of them with our Hurricanes in an instant.

People say USC was a valuable add to B1G (along with dillutive UCLA and vice versa) but Miami doesn't bring same (stand alone in market)?

The math isn't mathing.

Go Canes!
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Again, certain mopey porsters like to keep POUNDING the National Championship drum.

Last national championships:

Oregon - never
Washington - 1991
UCLA - 1954
USC - 2004 (or 2003, depending on your view of the rules)

Also, size of states by population:

1. California - 38.9 million
3. Florida - 23 million
13. Washington - 7.8 million
27. Oregon - 4.2 million

The math is so simple. The Big 10 might only "need" one Florida school to unlock higher carriage fees for the Big 10 Network in Florida, but to take UM-F$U locks up both the north and south ends of the third-largest state, adds an instant rivalry, and produces a multiplier effect in TV viewership in a state that is MUCH more football crazy than the states of Oregon, Washington, and most of California. Not only do you get the double-bang of UM-FSU, but it gives the Big 10 twice as many opportunities to get its teams INTO Florida and in front of Florida recruits. It gives the massive Big 10 alumni base in Florida a chance to watch their favorite teams. And it puts another college football playoff stadium (Joe Robbie Stadium) into the mix as a Big-10-friendly location, now that the Rose Bowl is dying out as a Big 10/Pac 10 game.

But, yeah. Coker. Shannon. Shalala. Golden. Diaz. Cristobal. Yeah, that's why we will never be in the Big 10...
 
Empirical Cane said:
Any porster with PE experience here?

How would PE extract value from a public institution's team? Merch and branding sales? I can see that on the private school side, but public school side....oooohhhhh boy.

And then what happens when the PE deal turns sour? Fire sale the assets?

MOVE THE TEAM TO ANOTHER CITY!?

**** YEAH!!!! LET'S HERE IT FOR THE CHARLOTTE CRIMSON TIDE!!!

View attachment 290355
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Depends on the structure of the PE deal.

There are a few primary strategies. In the most benign situation, a PE actually INTENDS to run the privately-held business well and make its upside from an IPO or a SPAC. This is what happened to my company, and our (former) PE recently finished cashing out all of its stock. And the PE made a tidy bundle.

In the middle-zone, a PE loads up a company with debt, thus taking a first-dollar priority as to (what would have been) the profits. This is the "leverage" model, where interest is "just another expense", though the IRS has made things harder with the interest expense limitation (pain in the *** to compute for the tax people). This is one of those that can test the greed of the PE, as some debt is fine and can be serviced out of the profits, but if the PE pushes the debt lever too hard, it will hobble the company.

In the most extreme situation (like what we just saw with Red Lobster), a PE will asset-strip a company. In the Red Lobster situation, Golden Gate Capital "bought" Red Lobster from Darden for $2.1 million, and then paid for it by selling the underlying real estate for $1.5 billion. This deal destroyed Red Lobster's credit rating and suddenly injected the company with rent expense that it never had previously (and was above-market, which might have worked before COVID, but absolutely is NOT working post-COVID). Sale-leasebacks can work in controlled situations. Shortly after completing construction, WalMart usually sells each store's real estate to an equity investor, BUT WITH A ROCK-SOLID LEASE IN PLACE, one that favors WalMart. That did not happen with Red Lobster.

From what I understand of the college PE deals, it will likely be a DEBT financing, giving the PE a priority on the revenue side, so it's like the second example above. I made a joke to another poster (who is a finance guy) about the schools needing to make a "full-faith-and-credit" pledge (it was a back-handed joke about US government deficit-spending), and he pointed out that the PEs will have first claim to the money. True. But THEN, the money that schools ordinarily received will be double-dinged by both the terms of the NCAA settlement AND any PE money that they accept and have to repay out of revenue. So, long story short, you might see schools having to finance SOME sports expenses out of the general operating fund. We can argue that the money comes from different silos, but money is fungible, so...somebody somewhere eventually pays the price.

And it will probably be the students.
 
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Rickd said:
Don’t forget both Fox and ESPN are working together to some degree on everything related to CFP and realignment. They are capable of anything that makes them all $$$$.
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Yeah, and what I'm afraid is going to happen is the "***** solution".

That's where the collective cowardice of the SEC and Big 10 and ESPN/ABC and Fox AS TO WHO WILL BE BLAMED FOR KILLING THE POOR-POOR ACC/BIG 12, kicks in, and we all get stuck with a "noble compromise" which allows F$U to graduate to the Big 2, while sticking the rest of us in the Little 2, and institutionalizing a monetary disparity PERMANENTLY between the Big 2 and the Little 2. With no chance of "fixing it" via Big 2 expansion.
 
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Kn[]_[]ckles3o5 said:
I can imagine a scenario, unlikely as it may be, where the big12 becomes part of a P3.

Conversations with the financial backers of teams like UM, TCU, SMU, OK St, UCF, etc may sound like "If you want this conference to thrive prepare to make up the diff in tv contracts/ NIL support until we are on equal footing to demand a similar pay out from the networks."

I think leaders would point to our time of dominance in the Big east as an argument for this choice. I think that's a mistake we shouldn't be looking back we need to look forward. Stop trying to recapture the magical underdog story and just try to take advantage of our history to settle into a spot among the elites.

A move to the big12 is a big gamble while atm it seems any move to the P2 would require a period financial inequity.

Either way looks like our boosters are going to be on the hook to help us keep up, so why gamble?
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Miami look back????

Never 😎
 
NorthernVirginiaCane said:
Yeah, I think the reporting on the espn contract has been very poor. It would be nice if the florida attorney general could actually get a copy released. I don't see how they have an opt out in 2025. That doesn't make sense and doesn't with the GOR. I would assume they had some sort of look-in to look at the profitability of the ACC Network based on what kind of coverage they were getting across the market.

Bottom line is the ACC Network is profitable. FSU and Clemson will certainly lose the lawsuits. Only question is if the ACC would entertain a settlement. I don't see how one is feasible before 2030.
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Do you have to work hard to be THIS wrong all the time?

"I don't see how they have an opt out in 2025"? And yet...actually, I don't know whether to criticize you for your ignorance or give you partial credit for being partially correct. There was not an opt-out. It was an opt-in. And the date already passed. It was unilaterally (and ACC-unconstitutionally) extended by the Commissioner to 2025. This has been reported on, by major media outlets. Maybe you could do a modicum of Googling before you **** out your next inaccurate post.

"That doesn't make sense and doesn't with the GOR". Setting aside my grammatical critique, you are once again wrong. Kinda destroys your whole "ironclad and irrevocable" steaming pile of horse****. When more informed posters than yourself were trying to educate you on what the ACTUAL terms of the GOR were, and how they did not comport with the ESPN Media Rights Agreement (at least the parts we knew about), you were too busy arrogantly dismissing everyone with your "I write enforceability opinions" garbage.

"I would assume they had some sort of look-in..." I'm not even going to quote your whole ignorant sentence. I would just refer you to the joke about the word "assume", and how it makes an "***" out of "u" and "me". Stop "assuming". We have 930 pages of informed discussion, all of which you choose to ignore so that you can post your uninformed musings.

And to top it all off, you CONTINUE to insist on a date somewhere within the 2030 decade, with no rationale for your date. Other than it is the earliest possible date that allows you to cling to your "2032 or so" prediction, which was similarly based on nothing besides your wild-*** guesses.

Oh, but you're going to blame "the reporting on the ESPN contract" for being very poor. Oh, you mean the contract that is kept under lock-and-key by the ACC, and is requiring the actions of two separate states and multiple judges to be able to get any information on the ESPN contract? Yeah, we should blame the "reporting on the ESPN contract".

Not, you know, ignorant attorneys who choose to post uniformed and misleading guesses, like you do.

"FSU and Clemson will certainly lose the lawsuits". We need to put that one on your tombstone, right next to "Ironclad and Irrevocable" and "2032 or so".
 
TheOriginalCane said:
Yeah, and what I'm afraid is going to happen is the "***** solution".

That's where the collective cowardice of the SEC and Big 10 and ESPN/ABC and Fox AS TO WHO WILL BE BLAMED FOR KILLING THE POOR-POOR ACC/BIG 12, kicks in, and we all get stuck with a "noble compromise" which allows F$U to graduate to the Big 2, while sticking the rest of us in the Little 2, and institutionalizing a monetary disparity PERMANENTLY between the Big 2 and the Little 2. With no chance of "fixing it" via Big 2 expansion.
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That is why I’m hoping for FSU / Clemson to the SEC, UNC locked into the ACC due to politics and Miami + one to the Big 10.
 
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NorthernVirginiaCane said:
No. I think you are basically 100% wrong. But we will see.
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He is 100% right. All of the facts that he states have been reported in the media.

You are the one that is (always) 100% wrong. We do not have to "see". We already know.

You are quite clearly shilling for the ACC. Why, I don't know. But it's the truth.
 
Handsome Squidbum said:
good catch. You might be right, but I think the current contract says espn can only renegotiate the deal if the number of teams drop below 15.

ACC added 3 teams so it stays above the number. ESPN could try and sue but I don’t think it has much of a case as the deal didnt say which 15 teams have to be included. So the money that would have gone to Clemson and FSU still goes to the ACC each year.
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As per usual, you are wrong. Completely wrong.

ESPN can renegotiate the Media Rights Agreement under a number of different reasons. One reason (which we have discussed in the past) would be EXPANSION of the numbers, such as if Notre Dame joined.

Another is under the Composition clause. If all 15 members of the ACC left, and a new 15 joined, there would be a renegotiation.

Finally, you ignore the Pro Rata clause, which allows ESPN to pay for new members at a pro rata percentage that is less than 100% (as they are doing with Cal, Stanford, and SMU).

Please stop opining on whether ESPN has "much of a case". You truly don't know what you are talking about.
 
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Rickd said:
That is why I’m hoping for FSU / Clemson to the SEC, UNC locked into the ACC due to politics and Miami + one to the Big 10.
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Yeah, I'm fine with mini-expansion.

And just hear me out...for a LOT of reasons...if you REALLY want to preserve the ACC...then the best plus-one to the Big 10 is...

USF.

Yeah, you heard me.

Recent AAU inductee.
Tampa. If you know where the Big 10 alums live, you get it.
USF is building an on-campus stadium and the student body is ALMOST as big as UCF.

Seriously. Before Fox got involved, the two inviolate criteria for Big 10 membership were "AAU" and "on-campus stadium".

Fight me.
 
TheOriginalCane said:
-Court order
-Not as of yet, the ESPN MRA was provided to Clemson under strict confidentiality

Although...I'd like to think that "accidents happen"...
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If I were an ACC member President, regardless of lawsuit, I would tell Phillips that I better have a full (and confidential) copy of the MRA on my desk so our attorneys can review it by tomorrow morning.

ACC's appearance of unwillingness of sharing it with members is a turrible look. Turrible.
 
Empirical Cane said:
If I were an ACC member President, regardless of lawsuit, I would tell Phillips that I better have a full (and confidential) copy of the MRA on my desk so our attorneys can review it by tomorrow morning.

ACC's appearance of unwillingness of sharing it with members is a turrible look. Turrible.
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Agreed.

And not that I have sympathy for this argument, but some will tell you "yeah, but the ACC members agreed to those terms".

To which I keep saying...you mean "15 idiot academics who don't have law degrees"?

We just have to acknowledge that these conferences are, to some extent (and especially the ACC), a clown car stuffed with 12-16 clowns, driven by a clown who gives sweetheart deals to his clown friends and clown relatives.
 
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