Big Ten Network vs. SEC-ESPN Deal

Submitted by jb5O4 on March 5th, 2010 at 4:06 PM

A big thing I have to put up with in Baton Rouge is hearing about the SEC TV deal, how much money it is, nation wide coverage, etc. I was a little frustrated about the Big Ten Network in its first couple seasons (especially when the MSU-Michigan game was put on BTN and not ABC). Considering the long term I think creating the Big Ten Network may have been one of the best sports TV ideas in history.

Television changes dramatically over the years, just look at what TV was in 1995 and look at it now. With Google looking into creating a high speed-high volume carrying infrastructure for the internet I believe there will be a heavy move towards using the internet as a carrier of television (as in showing live broadcasts such as NFL Sunday Ticket and NHL Center Ice online). Isn't it better to own your own television network rather than selling yourself off? As the Big Ten Networks revenues expand so does the pay out to the programs. Whether or not ESPN receives larger revenues the SEC teams will not be receiving a larger check, they are fixed at $2.25 billion to be paid out over 15 years to 12 different schools.

I believe the Big Ten schools are in for a big pay day as television is going to move onto smart phones and computers, expanding into any household that has an internet connection. In the coming years broadcast regions will be eliminated, allowing anyone to watch live anything, anywhere.

Comments

NOLA Blue

March 5th, 2010 at 4:43 PM ^

we have seen the near-death of the music industry, the destruction of movie rentals, the death spiral of newspapers, and massive cracks forming in the traditional network giants... I'm not sure that the infrastructure which has enabled the deconstruction of entertainment into freely-shared packages of bits is necessarily a win for the Big Ten Network. ESPN has already proved itself internet savvy... has the Big Ten Network? Selling entertainment on a network controlled by the customer is quite different from selling entertainment on the restricted bandwidths of TV and Cable when those were the only bandwidths in town...

jb5O4

March 5th, 2010 at 4:55 PM ^

Blockbuster is going out of business because there's Netflix (which also uses the internet to instantly provide high quality movies). I think music is a little different because the quality of a Limewire download versus something you buy on iTunes is minimal. Illegal sites that stream sports are terrible. The quality is awful, it lags behind in most cases.

The NFL offers Sunday Ticket both online and through the 3G network. On my computer NFL Sunday Ticket is ahead of the television and streams in really good quality. On my iPhone the NFL games are lagged by about 45 seconds to a minute. People are willing to pay for these services because the quality is good where as illegal sites are awful.

Movies are a perfect example. Illegal movies look awful, they sound awful. People are willing to pay $10 a month to get Blu Ray movies off of Netflix. Once high speed internet comes out youll be able to stream HD quality stuff onto your nice 50 inch HD tv. Networks will be able to take advantage of this capability as companies will pay more for ads if channels can broadcast in any region.

Zone Left

March 5th, 2010 at 8:15 PM ^

Cable companies pay subscriber fees for a reason. There may be clauses preventing live streaming over the net in most contracts--but I do believe internet streaming is the wave of the future once monetization is figured out.

Troy MiIler

March 5th, 2010 at 8:28 PM ^

Are you referring to the monetizing of internet usage? Such as, you use this much bandwidth, you get charged this much. If so, that will be the death internet streaming, in my opinion. You would be surprised how much data is sent when you're streaming HD content on the internet. Rather than doing that I think you're going to continue to see monthly bandwidth caps, and the higher the cap, the more you get charged a month. That's the future, unless the government steps in and starts laying down some rules regarding business practices of the ISP's.

jb5O4

March 5th, 2010 at 9:22 PM ^

Networks will definately take advantage of internet capabilities, the more people you can reach the more money in advertising. It would also allow for cable companies to provide service nation, even world-wide. It would also allow for competitive pricing as you can have more providors to choose from in your area if you can use an internet connection to get tv.

karpodiem

March 6th, 2010 at 12:05 AM ^

the SEC deal exposes ESPN to a huge amount of risk. While the SEC's popularity will surely stay at more or less the same level, I would venture to say that it would be difficult at best to picture what TV advertising landscape will look like in even 5 years. ESPN is on the hook to pay the SEC, but can ESPN bring in the same/larger advertising revenue year over year to please shareholders?

We'll see. But I absolutely loathe ABC/ESPN for putting the Rose Bowl on ESPN, that is pretty disgusting.

Tamburlaine

March 6th, 2010 at 11:36 AM ^

I'm no economics wizzard, and probably not even an economics neophyte, but seeing ESPN on the hook for that amount of money means they are awfully dependent on an economic upsurge, and finding advertizers who are going to keep shelling out bigger and bigger bucks to support these types of deals.

of course, the BTN is kind of in the same position--which is why I see a possible Texas addition as something that would ensure (as much as possible), millions of TV sets hooked up to the BTN.

One thing that is lurking in the shadows that could hurt a network like the BTN, though, is if cable goes a-la-carte. ESPN is pretty much a must for most sports fans (even though they are out to get EVERY team they cover--especially Michigan). Right now the BTN is gaining access to basic package status--we have it here in Omaha--but if cable goes to pick and choose, BTN would probably be OOT because this is, well, not Big Ten country. Not huge, but you are talking about 200,000 or so cable customers here (in Omaha; I'm not sure if BTN is a standard offer outside of Omaha in Nebraska).

It's another reason to very carefully consider options when adding a team (I'm sure the Big Ten has me beat on this one). I'm in favor of a Big National Name that pulls interest from everywhere and not banking on adding another middling, boring Rutgers or Syracuse in the hope that New York all the sudden becomes interested in college football.

SteveSlats

March 6th, 2010 at 3:08 PM ^

The NY Yankees started their own YES network to capture more of the cable TV revenue. Why split the pot with ESPN, FOX or some other network when you can keep all the rvenue with your own network? I would expect the BTN network to pursue a similar stategy as some of the existing TV contracts come up for renewal. That's also what's driving the desire to expand into new geographic areas.