Expansion Mailbag: About Expansion

Submitted by Brian on November 20th, 2012 at 11:03 AM

this song is exactly like adding Rutgers and Maryland because it is waste and terrible and has pointy hair

A side note: the poll from late Sunday is running 83-17 against Rutgers and Maryland.

Ok, so I find this Maryland/Rutgers thing agitating from a tradition standpoint and pointless from a $$$ standpoint. Michigan, Ohio State and PSU probably have the lion's share of CFB fans here in NYC already.

While meanwhile BTN is on the basic sports tier for $3.95 or something so anyone who wants it (and a ton of people who just want Fox Soccer or whatever) already has it.

The one group BTN _could_ conceivably seize in this area is Notre Dame fans. If this is a play to strangle ND's other avenues (ACC, Big East, with Big 12 already raided for Nebraska), it starts making a little more financial sense and becomes more palatable from a tradition standpoint.

Have you heard any rumblings to that effect? If that were in fact the idea, would you get behind it more?

Ben

Ben. You are a crazy bastard. Snatching one team from a 14 team conference that can immediately consider a near-equivalent—possibly an upgrade!—in UConn or Louisville is nowhere near destabilizing enough to do anything to Notre Dame, an institution looking saner by the minute for opting out of this conference business.

In fact, I would be infinitely happier with Louisville than either of the selected teams. You can drive there, they are the biggest thing in the city that is not a horse, and they are at least as good as Maryland in basketball with more promise in football.

What do you think the Irish fanbase's reaction to the Big Ten's Semisonic move was? I'll tell you:

  1. gales of laughter
  2. yet more gales of laughter
  3. that point after gales and gales of laughter where everything's petering out and you can't summon the oxygen to continue but you have that lovely, blissful aftertaste of laughing at everything for so long
  4. a silent prayer of thanks for Notre Dame's obstinate insistence at independence even if it requires playing a bunch of middling ACC teams each year
  5. oh my god the Big Ten voluntarily sucked up a middling ACC team and Rutgers
  6. gales of laughter
  7. ad infinitum

Notre Dame's avenues are broad and gilt-lined. As long as they can assemble a schedule that can get them into a four-team (and possibly expanding) playoff, they can tell anyone they want to FOAD.

Brian,

Let me start by saying I hate the addition of Maryland and Rutgers to the Big Ten. They're crappy teams with insubstantial fanbases who've pretty much never been good. It's clear the decision for them to jump ship from the ACC (Or Big East, or whatever) to the Big Ten is based on a desire to make more money, as the Big Ten can afford them more money. Assuming that's true, do you think that increase in revenue can help them to eventually become better teams?

The obvious answer is no, you can't just throw money at a program and magically solve it's problems. But one can't deny the correlation between successful football programs and the endowments of those universities. Maybe Delany's thought is that he can grow Rutgers and Maryland's program into respectability over the course of time. During that time, he has new television markets he can get revenue from (theoretically), and new fanbases to own. I don't know, that's honestly the best explanation I can think of. Your insight, as always, is appreciated.

beenplumb

Ah. I see you are also in the bargaining phase. Welcome. It is slightly nicer here than depression.

I don't see how it happens. Loyal fanbases are built with wins or boredom. The fundamental problem with the awesome TV markets of Maryland and Rutgers is they are occupied with everything else in the world. The only way either of those programs is ever going to be anything more than they are right now is by beating M and OSU, or at least playing them with major stakes. That doesn't look like it'll happen, and the instant any of those teams falls off the map whatever bandwagon has assembled will dissolve into one of the other eight-six available teams. At best you're looking at an Iowa/MSU/Northwestern thing where they pop up to be interesting two years in a decade.

I think the chances of building something at Louisville would have been much greater, academics be damned, TV markets be damned. The city of Louisville doesn't have two pro teams in every sport sucking up all the oxygen.

Brian:

Not to make this even worse, but with the way the BTN contracts with cable operators are set up, adding Rutgers will NOT (at least initially) require cable operators to launch BTN on expanded basic in the New York market.  The addition of schools is set up on a state-by-state basis, meaning that Rutgers will require a move of BTN to expanded basic in New Jersey ONLY (half of New Jersey already should have BTN on basic b/c Phili market is considered part of Big 10 core footprint.  Big 10 core footprint is all states with Big 10 schools plus the Philadelphia and St. Louis markets).

Some caveats:  If a cable operator in New York market already carries BTN on a sports tier, and has a contract up for renewal soon, you can bet the Big 10/FOX will force BTN onto expanded basic.  And if a cable operator doesn't carry BTN at all, you can also bet the Big 10/Fox will require expanded basic carriage if the operator wants to launch it.

That said, it could be a bit awkward to see Rutgers come in and BTN not go into New York City TVs, at least initially.  PR-wise, the hit might be rough, although this is already a garbage idea anyway.

-credible anon guy

You did make it worse. Actually, wait. Michigan is putting a quarter billion dollars into nonrevenue sports. I don't care about money. I will never, ever again say "this will put the Big Ten on good footing relative to other conferences." I'm done.

TWO AND A HALF MEN

dog groomin'

I became a CF fan 10 years ago because I got tired of the NFL and was attracted to the tradition and pageantry of CF. I love the big stadia filled with young fans and the regional rivalries with trophy games like the Paul Bunyon ax and the Bowl games. Now it appears that CF is trying to become the NFL-Lite with super conferences that are destroying ancient rivalries and playoffs that threaten the bowls. Now we have two mediocre teams added to the Big Ten that will do nothing for the conference on the field. At some point don't you think that CF fans like myself ( and I am sure there are many like me) will become turned off, that any new fans will be offset by those like me who, if we want to watch the NFL, will simply watch the real thing?

pffyank

Yes. This is the most irritating thing about the band of folks who tell you "no you just don't get it, this is about the future." This is a short-term money grab based on nothing else but the possibility of putting a cable TV channel on some homes that do not already have a cable TV channel.

The problem is that in five to ten years when some modicum of financial benefit is being realized—and that will be a boost on the order of 10%, not 100%—people will have ever-fatter internet pipes and start bailing on cable for internet streaming. Watch what happens in Kansas City now that Google fiber is in place. The ability to bilk old ladies out of a dollar a month because they want to watch Matlock marathons is rapidly ending. The Big Ten Network will be an ephemeral bridge between an era when gatekeepers kept all the things and one where epic bandwidth means you get only what you want—you pay only for what you want—always.

Once the cable barriers come down, as they inevitably will, this comes down to committed diehards per school. How many people will pay you specifically instead of allow themselves to be roped into an expensive package of channels they largely don't care for but have no choice about?

Maryland has several, but not many compared to most Big Ten schools. Rutgers has one, he's a nice guy, he is @ruscoop. I don't think that's enough.

For this short-term gain, you dilute the long-standing rivalries, the decades-long narratives, the very heart of the thing that differentiates college football from all the other things competing for attention. It's the same thing Brandon has done to Michigan Stadium—in an effort to make its appeal the same as everything else he has sacrificed anything unique about it that might make one love it.

There are still things to love about college football—I mean, Denard—but increasingly they are surrounded by crap that you tolerate. The future is the niche, even at macro scales, and broadening out your product to be a Midwestern sports Two and a Half Men is a losing idea created by men with no imagination who rely on spreadsheets to create the future.

I mean, who's crazy here: the fans who were generally okay with the additions of Penn State and Nebraska or the men who added nonentities the entire league has to fly to so they could get a TV channel in some extra homes?

I can't tell if Rutgers has a D1 hockey program. If not, doesn't that scuttle B1G hockey? IIRC, the B1G by-law requires half of the conferences schools to field a D1 roster in order to have in conference competition in a given sport.

Paul

They do not. Neither does Maryland. Neither will add hockey any time soon because they are still crawling out from massive piles of debt, which should make you think about who is using who here. Note that most other ACC programs are doing just fine financially, and Maryland would not be interested in moving from the conference they were a charter member of except for the fact that they have bungled everything so badly they need the Big Ten's money. That's our prize.

It won't affect Big Ten hockey for the same reason that this is happening in the first place: the BTN needs content and the BTHC provides it. The most interesting impact this thing may have on college hockey is that if UConn is the pick for the ACC, they'll be one program away from having to launch an ACC hockey conference. [HT: BC Interruption.]

I'd actually be in favor of that; the best way to get college hockey to expand is to break up the ice-floes that are 12 team conferences and provide inviting homes for startups large and small.

Regarding Big Ten expansion in general, and adding Maryland and Rutgers (lol, wut?) specifically.

Also, and somewhat random, am I making a correct observation that OSU has the easiest road to the CCG for the foreseeable future? Outside of Michigan, who else can legitimately challenge them on a consistent basis? PSU, with the scholarship reductions will most likely bottom out some point soon. Wisconsin is coached by Bielema ('nuff said right?) who likes to run the ball with no timeouts left down a score late in the fourth and then again when it's 3rd and 7 in overtime. Then you factor in general superiority in coaching and players and it really adds up to a frequent cakewalk to Indy. (Obviously not everything is written in stone, but just playing the odds, yuck).

I don't know Meyer's health condition, but it really seems like he's the kind of guy who likes to win and he'll do what it takes to make it as easy as possible i.e. leave the SEC where his teams started to decline post-Tebow, to the weaker Big Ten with Miller already on the roster.

Anthony

Well, our collective freakout about the divisions may be premature. Delany said some business about not having anything predetermined at the moment, and while anything that comes from an executive has to be taken with a grain of salt… let's latch on to that super hard you guys.

The Big Ten needs to stop looking at Penn State as some sort of historical juggernaut and consider what it's done since entering the league. I had to go back to a 2011 revision of Joe Paterno's wikipedia page to get this, but here is PSU's record against the four Big Ten teams (along with Nebraska) that were considered plus programs when they put these divisions together:

  • Wisconsin: 6-7
  • Iowa: 7-9
  • Ohio State: 7-13
  • Michigan: 6-10

They're 0-2 against Nebraska; their game against Wisconsin is pending.

The vast bulk of the results were compiled before Joe Paterno was hurled from his pedestal and Penn State was hit with the most serious NCAA sanctions since SMU. At best they are a Wisconsin/Iowa equivalent.

Yeah, Michigan and Ohio State are likely to be the best two programs in the league over a long period of time but in any given year the best program from the Nebraska/Wisconsin/Iowa/Illinois* group is going to be a stiff test. A hypothetical division with M/OSU/PSU versus the hate parallelogram is

  • winner of A/A/B program fight versus
  • winner of A-/B/B program fight

It is less than ideal, but this is a conference that just added Maryland and Rutgers. In terms of less-than-ideal situations it is far from the least ideal. It is a lot more intriguing than a division in which Wisconsin/OSU is the championship game for the next decade.

*[Illinois is good sometimes. I know it's weird.]

Comments

UMQuadz05

November 20th, 2012 at 11:14 AM ^

In ten years, when CFB has exploded and faded like NASCAR and the NHL today, we can look back at yesterday as the start.  My advice?  Buy Detroit FC tickets and join US Outlaws.  Live, local soccer and watching the international version is the closest thing to the ol' time footbaw experience.  

I should know.  It's what kept me sane living in a big East Coast city after graduation.

bdsisme

November 20th, 2012 at 11:23 AM ^

I know you called the guy talking about the BTN contracts in the NY/NJ area "credible anon guy", but don't you think that Delaney has more knowledge of what will happen re: cable contracts than him?  I mean, I'm guessing Delaney didn't make this decision willy-nilly, and that he had plenty of experts weigh in and geeks running the numbers.

bdsisme

November 20th, 2012 at 12:16 PM ^

I do trust Brian's anonymous sources, but in this case I think the source is overconfident and that Delaney will slap him around and he won't be able to do anything about it.  Long argument tying in Fox's ownership stake and their acquisition of the YES Network, pairing YES and BTN together, etc.

CommodityTrader

November 20th, 2012 at 12:47 PM ^

As a long time follower and brand new commentor, please take this comment with the consideration provided.  Raiding Rutgers (NYC/NJ market) and (Maryland DC market) are two of the three biggest TV markets for the Conference formerly known as the ACC.  That conference will now be destroyed.  Not because the football is great and you want it added to your conference, but because the football is TERRIBLE and it is unsustainable as a conference.  ND went there to have "credibility" - the Big Ten has destroyed that.  Just refer to the PANIC at Duke, they have one relevant revenue sport and they are now likely to lose UVA, GA Tech, UNC and FSU from their conference.   Two of the Top Three (Atlanta) TV markets, that's the brilliance of our latest move.  Biggest question for us is who's the last two:  Kansas, UVA, UNC?

ijohnb

November 20th, 2012 at 11:31 AM ^

the world is not ending.  Regardless of what the Big Ten did here, college football is not college football anymore.  It has not been for years.  The Big Ten has two choices, accept the reality and be proactive, or "stick with 12" and become irrelevant.  The Big Ten is not going to have 16 teams, this "region" is going to have about 30 teams, as is the Southeast, the Southwest, and the West.  The Big Ten is staking a claim as a super-conference.  They are claiming turf.  That is all and it is/was inevitable.

AAB

November 20th, 2012 at 11:47 AM ^

People keep making it, and I don't get it at all.  What exactly is the argument that a 12-team Big Ten would be irreparably screwed if other conferences had 16 teams?  The Big East has 4,000 teams in basketball and the Big 10 is the best conference in the country at the moment.  

UofM-StL

November 20th, 2012 at 11:57 AM ^

I think you're absolutely correct here. For some reason this idea of 16 team conferences being an inevitable endgame has entered everyone's heads and they're approaching this whole thing with an "adapt or die" mentality that doesn't really make much sense.

There is no discernible reason that a 16 team conference would be any more stable/profitable/successful than 12 teams, 10 teams, or 20 teams. It's just a number, it doesn't make anything any better.

If the Big Ten stayed at 12 teams and everyone else expanded to 16, there is not a single reason in the whole wide world to believe that the Big Ten would have become irrelevant.

ijohnb

November 20th, 2012 at 12:03 PM ^

half of the conferences in college football right now are going to become irrelevant, in terms of name and distinction.  What ND did with the ACC is the future of conference affiliations in college football.  Have you noticed that college football flat out makes no sense, in terms of who plays who, attempting to combine bowl games with playoffs to make a completely non-sensical mess, teams with conference memberships that make no sense, geographical or otherwise.  All of these things are signs of a seismic shift in the way the sport will operate in the future.  The Big Ten will become irrelevant with 12 because 12 team conferences are not the future of the sport.  I don't think 16 is the magic number, or 18 for that matter, I don't see the future of the sport being a version of what it is now, I see it being a completely different landscape.  The financial implications of the sport have become to big to be supported by the current model.  What the Big Ten is doing is saying "we don't know what is coming next, we don't know what it will look like and it might look nothing like it does right now, but we are in, for better or for worse."

AAB

November 20th, 2012 at 12:05 PM ^

but this:

"The Big Ten will become irrelevant with 12 because 12 team conferences are not the future of the sport."

is A. begging the question; and B. not an explanation for why a 12 team conference is a problem.  Can you explain, without using any MBA buzzwords, why a 12 team conference would be at a disadvantage in the totally outrageous paradigm that is being created?

ijohnb

November 20th, 2012 at 12:24 PM ^

must have a playoff to decide a national champion.  Conference championship games make absolutely no sense if the outcome of a conference championship game has no direct correlation to who "plays on" in a playoff system by virtue of the win.  In fact, playing in your conference championship game hinders your ability to play for a national championship. The conferences are going to consume each other until a model emerges that supports and allows for a true playoff to take place, beginning in conference play and leading to a "conference (regional) championship" that actually has a bearing on the national playoff and the national championship.  I fully buy into the four superconference model of college football.  I don't know if I like it or not, but I think it is going there.

AAB

November 20th, 2012 at 12:27 PM ^

pure and simple.  The existence of conference championship games has nothing to do with a playoff system.

Also, we won't be going to 4 regional superconferences if the Big 10 just....refuses to join one.  And you still haven't explained why staying at 12 teams would be some sort of catastrophe.  

ijohnb

November 20th, 2012 at 12:36 PM ^

existence of a conference championship game could have to do with a playoff system.  They could still be about money, actually even more money, but also be involved with, and not actually interfere with, the process of determining the national champion.  Right now what is wrong with a 12 team conference, nothing I guess, if you think the college football system in place right now makes any sense at all.

Alton

November 20th, 2012 at 12:45 PM ^

We are looking for a point of equilibrium--one where the need to expand goes away.

Obviously 12 was not that equilibrium point.  You say (reasonably, I guess) that 14 is also not that equilibrium point.  The question you are being repeatedly asked is: why do you think 16 is an equilibrium point? 

People like you are saying, "we are headed toward 4 conferences of 16."  I am asking why not 4 conferences of 17?  Or 4 conferences of 13, 21, 34 and 55?  What's so special about 16?

ca_prophet

November 20th, 2012 at 7:04 PM ^

It's that simple.  That's the reason that a 12-team Big Ten wants to expand.  The scenario that they fear is that the 16-team conferences arrange for their 8-team division champs to be seeded into a playoff, while the 12-team conferences and Notre Dame play each other for the right to be the bottom seed.

Why would they do that?  Because it makes things better for the other 100 teams in Division 1A of the NCAA, and the Big Ten would get outvoted.  Right now, the Big Ten has a roughly equal voting impact with the others (not the same, but not grossly underpowered either).  If the Big Ten doesn't expand with the rest, that voting power gets diluted to the point where we might actually get forced out (or at least seriously disadvantaged) in that emerging playoff picture.

Brian's point was that Notre Dame is fine as long they can put together a schedule that gets them into the four-team+ playoff.  In an eight-team playoff world with four superconferences, you could easily end up with a deal where 6-7 of the spots are locked into those conferences, and Notre Dame is competing with 2011 Michigan for a spot every year.

In short, the reason we want to be part of a superconference is so that we get preferential bids for that college football playoff.

 

MaizeAndBlueWahoo

November 20th, 2012 at 12:15 PM ^

There is nothing coherent or intelligent about this post whatsoever.  You did nothing to explain why 12-team conferences are "not the future," nor did you explain why there's anything magical about the number and only the number, and not the actual members.  The A-10 has 16 members right now.  Does that mean it will be a more relevant conference than the Big Ten if the Big Ten doesn't add two teams?

MaizeAndBlueWahoo

November 20th, 2012 at 11:32 AM ^

I don't think the ACC is anywhere near that close to starting a hockey conference.  That article sort of assumes there will new teams, and it gets pretty desperate toward the end by suggesting that some schools would have hockey teams because they're near NHL teams.  One of which was Maryland.  I notice Miami wasn't included even though they're close to an NHL team too.  Pitt was mentioned "as a way to take the attention off of Tino Sunseri."  This is not a reason to start a hockey team.

In reality, there's BC, ND, and then maybe UConn, assuming the standard assumption comes true.  Syracuse is still conjecture.  After that, it's a very, very long leap toward getting two more teams.  We are closer now to B1G lacrosse than to ACC hockey.  Much closer.

lhglrkwg

November 20th, 2012 at 1:39 PM ^

the article also mentions (in the update) that you actually only need 4 teams to start up a conference (at least in the ACC).

Hence, you're already sitting there with BC and Notre Dame now. In the (somewhat likely) event that UConn joins the ACC, you have 3 teams with UConn just now ramping up their program. Syracuse would be an easy add (they already have a women's D1 team) and then bam, you have an ACC hockey conference.

Unfortunately (like I mentioned below), I think that may mean the dissolving of Hockey East if they get all upset like the WCHA did. That'd be three of the premier teams (in name only) leaving the conference at once

MaizeAndBlueWahoo

November 20th, 2012 at 2:12 PM ^

But why would they?  "Because they do it in lacrosse" is not the answer; all four ACC teams are well-established powerhouses and none of them need the autobid to get into the NCAA tournament.  The same would not be true of ACC hockey; only BC can really say that.  ND kind of, but they're not that well-established.

Plus there's the issue of scheduling.  Hockey teams play three times as many games as lacrosse teams, which only play 12 or 13.  The hockey season is longer - six months vs. four.  Being in a four-team conference would require a huge nonconference scheduling effort.  You could schedule a double-round-robin in the conference to make it easier, but why would BC and ND give up the conference matchups they have now for four games against Syracuse and UConn?

winged wolverine

November 20th, 2012 at 11:36 AM ^

Let's just pick up the University of Toronto. They are an AAU instution, gives the Big 10 6 million more viewers (and the all important Canadian market and recruiting grounds (Biakabatuka!), and they have to have a hockey team, right? 

Indiana Blue

November 20th, 2012 at 11:37 AM ^

Yes ... the natural selection process would have been to have nd join the B1G, easy travel as it sits right in the middle of the B1G geopgraphical map.  But few realized that nd is actually a perversion of natural selection ... you see they MUST be relevant in fb every year ... which frankly would be impossible in the B1G.  nd's entire being is built on a legend (aka - fantasy) ... regardless of fact, & their alum and fans (which I project the alums are roughly 20% of their fanbase) are the "aristocrats" of the CFB society of today, at least in their minds.

nd has told their only true B1G competition to fuck off ... and now it is time for the B1G to tell nd the same thing.  Hey Delaney - give Michigan, little brother and purdue enough cash to buy out the remaining contract games with nd.  That should leave them with 9 games next year and will ruin their dreams of BCS land in 2013.  I would rather play Slippery Rock than the piece of shit that resides in South Bend.

Go Blue!

Ed Shuttlesworth

November 20th, 2012 at 11:39 AM ^

Yep.  The whole premise of this expansion is a cable TV model wherein people can get roped into paying for something they don't want.  That model is destined to end and there is no other possible destiny but it ending.

It may have ended by 2017 when the OMG FIRST TIER RIGHTS!!! are up for rebid.  I'd say that's better than 50-50.

Erik_in_Dayton

November 20th, 2012 at 11:40 AM ^

The divisions are the one of worst parts of this to me.  OSU is going to have the three worst teams in the league in its division - Indiana, Rutgers, and Maryland.  Even a recovered PSU will not make up for that.  Meanwhile, Michigan's only truly deadbeat fellow division member is Minnesota.  OSU accordingly has two more near-sure-thing wins per year than do the Wolverines. 

Kilgore Trout

November 20th, 2012 at 11:48 AM ^

I am going to reserve judgement until I see if we're really stopping at 14. 14 is a stupid number. It doesn't divide in a way that allows you to do anything creative. 12 is fine, 16 is fine, 14 is dumb.

I know this has been said a million times, but if you go to 16 and make four pods based on regional and rivalry perspectives, you can make this work and keep things interesting.

B1G East - Penn State, Maryland, Virginia, North Carolina 
B1G South - Indiana, Purdue, Northwestern, Illinois
B1G North - Michigan, Michigan State, Ohio State, Rutgers
B1G West - Wisconsin, Minnesota, Iowa, Nebraska

If you do this and change the divisions every year, then at minimum you play everyone in the conference every 3 years and you play your close rivals EVERY year. My set up would be that you play seven division games first and have a crossover at the end of the season which includes semi-finals (2nd place D1 at 1st place D2, 2nd place D2 at 1st place D1) and then have a championship game. Michigan / OSU would still be the last game before the cross over, we'd play every year and could meet in the championship, but would never play back to back. It's the only way...

UofM-StL

November 20th, 2012 at 11:49 AM ^

The point you make about internet streaming is extremely important and almost completely overlooked.

In fact, BTN, the NFL Network, and others are already making money in regard to online streaming subscriptions. Specifically, they're being paid a ton of money by DirecTV and a host of cable companies to NOT offer such subscriptions. The technology is there, the demand is there, but the old guard of gatekeepers knows a threat when they see one and are doing everything in their power to slow the inevitable advance.

You can see this effect on HULU and WatchESPN as well. If you want access to all of the WatchESPN programming, you need to log in with your cable provider account, and essentially prove that you get ESPN anyway. So you're cutting out the market of people who don't want to pay for cable, but still want to watch ESPN.

On HULU, you can still watch their programming without logging in with your cable provider info, but you have to wait a week longer than those who get the channels on TV anyway. Again, the gatekeepers here are trying to keep internet streaming from becoming more convenient than cable, unless you pay for cable anyway.

Obviously this is an unsustainable model. You can't base your revenue strategy on making some third party pay you to not provide a product that your customers want. We are not far from a world where you can pay a monthly fee directly to content providers for complete access to their content online. I would not be surprised to see ESPN implement something like this within the next year or two.

Once that line has been crossed, there will be absolutely no advantage to "expanding the footprint" or "cultivating new markets" for BTN. The only thing that will matter is increasing the total number of Big Ten fans who are individually willing to pay for BTN's content. Maryland and Rutgers come into the Big Ten with two of the smallest fan bases in the conference (according to the Nate Silver post on the board), and will hardly make a dent in BTN revenue once the sift described above occurs.

To sum up, there is nothing about this expansion that is good. Even the one thing that seems like it might be good is not going to be good anymore in 10 years.

chisf

November 20th, 2012 at 11:50 AM ^

The content owners (BTN, ESPN, etc) don't want the model to crash.  ESPN gets $5.00 or so from every cable subscriber (plus more for each Internet subscriber for WatchESPN).  Were this model to collapse, and the government to require a la carte, ESPN will likely have to charge something like $30.00 per subscriber to recoup lost money.  How many people will pay $30.00 permonth for ESPN?

UofM-StL

November 20th, 2012 at 12:07 PM ^

Does ESPN actually get $5/cable subscriber? Where's your source for this? I would be shocked if it was true.

If basic cable costs $60/month and provides 60 channels, that's $1/channel if every last cent of the subscriber fees went directly to the content providers. But of course, a huge chunk of that money goes to support the cable company's infrastructure and profits.

So let's be extremely generous and say that only 50% of subscriber fees go back to the cable company, and the rest gets distributed to the content providers. That leaves an average of $0.50/subscriber for each channel. Of course, some channels may demand more than others, so in this scenario it's possible to assume that ESPN gets upwards of $1/subscriber from cable companies.

If 1 out of 6 people who subscribes to basic cable would be willing to pay for ESPN directly (I used your $5 -> $30 to set this up, but honestly I think the number would be higher than 1 in 6), ESPN would have to charge $6/month to make up the difference if the entire cable/satellite system were to fold altogether.

UofM-StL

November 20th, 2012 at 12:38 PM ^

Thanks. I do find this surprising, and it certainly has an affect on the timeframe of what I was talking about, but I don't think it changes the overall point that much.

Mostly, I have to assume that if ESPN is able to get away with charging so much more than pretty much any other channel, then the percentage of current cable subscribers who would subscribe to ESPN directly is very high. I make this assumption because if it was untrue, cable providers would simply refuse to pay that fee and not carry ESPN. Presumably there would be a major revolt from a high percentage of cable subscribers if this happened.

If the percentage of subscribers who would pay for ESPN directly is as high as 50%, then ESPN would have to charge $10/month to individuals to make up the difference. Doesn't sound as nice as $5-$6/month, but it's still awfully reasonable.

HAIL-YEA

November 21st, 2012 at 12:13 AM ^

you think 50 percent of households with cable would pay 10$ a month just for espn online?  At least 30-40% of those subscribers are people who dont even care about espn or sports in general. Plus you are not factoring in what espn is paid to not provide the service.

 

Lastly it is the same cable companies who would be losing subscriptions that are providing everyones internet. If their video service packages were being threatened they could easily put a limit on data usage and screw over people trying to stream everything.  Eventually Internet cable packages will be out there... but not any time soon and it will be the cable providers who offer it.. not individual networks

MGoShoe

November 20th, 2012 at 12:24 PM ^

...this article from Sports Business Daily:

TOP 25 CABLE NETWORKS BY MONTHLY SUBSCRIBER FEE
RK
NET
SUB FEE
RK
NET
SUB FEE
1
ESPN
$5.06
14
Nickelodeon/Nick At Nite
$0.52
2
ESPN 3D
$2.71
15
HDNet
$0.47
3
3net
$1.29
16
FX
$0.46
4
TNT
$1.21
17t
Fox College Sports
$0.39
5
Disney Channel
$0.97
17t
MTV
$0.39
6
NFL Network
$0.84
19
HDNet Movies
$0.38
7
Fox News
$0.82
20t
Big Ten Network
$0.37
8
ESPN2
$0.67
20t
Discovery Channel
$0.37
9
USA Network
$0.62
22t
Sony Movie Channel
$0.32
10
TBS
$0.59
22t
CNBC
$0.32
11t
MGM HD
$0.58
24t
Antena 3
$0.31
11t
CNN en Español
$0.58
24t
Lifetime
$0.31
13
CNN/HLN
$0.57
 
   

 

trueblue262

November 20th, 2012 at 11:49 AM ^

And there may not be many with me, but I do think that this realignment is a "poker game" you throw out a couple cards to bring in the big hand. Maybe Delaney is playing the cards right here, bringing in a couple "meh" teams, and forcing hand to the other conferences to make a move (possibly a similar move) and then some of the bigger teams go into a panic mode and and start beating on the B1G's door.

wile_e8

November 20th, 2012 at 11:49 AM ^

So can we have Heiko or Ace specificially ask Delaney at the next B1G media day about contigency plans for 20 years down the road when bilking cable customers with no interest in college football for BTN fees is no longer a winning strategy? Do Maryland and Rutgers have little clauses in the invitation fine print allowing us to revoke membership then?