OT: New Playoff Format Could mean $5 Billion in TV Revenue

Submitted by house of pain on June 26th, 2012 at 11:44 AM

With the impending playoff format being implemented, it is discussed here that the TV revenue could hit  nearly $5 billion. IF the TV $ comes close, meets, or exceeds that dollar amount, you can bet that NCAA will add more teams to the playoff fold to potentially shore up  more money.

 

With that said, we all understand how the BCS is a cash cow. If the projection is correct the cow will be larger and more powerful. As a college football fan, I hope they add more teams to the playoff. But, I can't help but think of the potential for even more corruption with this amount of money at stake.

 

EDIT: Sorry forgot to add link  http://collegefootballtalk.nbcsports.com/2012/06/25/sporting-news-playo…

Comments

French West Indian

June 26th, 2012 at 3:33 PM ^

...it's not really the D1-A/FBS championship, it's the BCS championship.  It's closer in constitution to the NIT in basketball than it is to the NCAA's Final Four basketball tournament.

That's also why myself and a handful of others (Delaney) still consider the Rose Bowl more prestigious than the sham BCS title.

The NCAA, of course, specifically does not award a championship in FBS.  If it did attempt this then it would have to make it fair to all FBS schools and given the number of teams (120) and the disparity between teams (U of M and EMU as just one example) this would require a total overall of the FBS division that is just unlikely to ever happen because it would bascially mean the dismantling of all the conferences including the Big Ten and the SEC.

MGoShoe

June 26th, 2012 at 12:14 PM ^

...link is the Sporting News Matt Hayes article.

The 2011 BCS contract paid out $174 million, and the newly restructured postseason would nearly triple that number. Those numbers clearly outline why the committee won’t opt for a Plus One postseason—one game after all the bowl games are played—instead of the playoff proposed by the conference commissioners and Notre Dame athletic director Jack Swarbrick. “They’d be throwing away $2 1/2 billion—at least,” one BCS source said.

Depending on how the two packages (the semifinals and the championship game) are sold (separately or together), the contract could balloon to as much as $500 million annually. Both SEC commissioner Mike Slive and Big Ten commissioner Jim Delany have said over the past month that they prefer a long-term deal with their television partners, and the most popular of those appears to be 10 or 12 years—with multiple look-ins during the deal to allow for renegotiations.

Presumably, these look-ins would provide the possibility for renegotiations to account for a future playoff expansion, but I doubt they'd need such a mechanism since changing the playoff structure would on its own change the terms of the contract and necessitate a re-negotiation or re-bid process. Instead, the look-ins will likely be used to modify the terms of the contract up or down after ratings and ad buy data becomes available.

The key graf for maximizing the value of the contract seems to be this one:

While ESPN has right of first refusal and an exclusive negotiating window before the bidding process is opened, a BCS source told Sporting News the goal is to get ESPN, NBC, Fox and CBS to bid on some or all of the package and drive up the price.  

I for one would welcome a deal where the semis and championship game rotates among broadcasters, a la the NFL. Better to be bought and sold to many corporate entities than just one (the WWL).

woomba

June 26th, 2012 at 12:53 PM ^

That the playoff is done outside of the bowls?

As it stands right now, both playoff systems have the same number of games - so I doubt that the monetary differential will be that big

woomba

June 26th, 2012 at 3:05 PM ^

that the increased payout is based on the new contract, not the format of the playoff itself.

Given that the agreed format takes place within the bowl structure, the only real difference between the Plus-One and the 4-team playoff is the seeding system that places the teams into the different bowls.

That should make for better matchups and increase the value of the games - but it probably doesn't account for the majority of the value of the new contract.  A plus-one format shouldn't be that much worse off than whatever the new system is valued at.

Sorry - not really picking an argument with what you're saying, but I'm convinced that there's a lot of bad/lazy math being thrown about when people are talking about the different playoff formats just to further their own agenda

LSAClassOf2000

June 26th, 2012 at 2:07 PM ^

It seems to me that there will be a lot of looks-ins done at the front end of the deal, especially since there is no historical data for ratings on semi-final games (although they could definitely estimate it based on the NFL conference championships, something to which the article alluded). I would guess that a network or two might sit on this for a "look-in" or two and not get involved until they have some idea of what the ratings revenue from those would look like, or indeed if they could simply bid on portions of the package. I don't know if all the major outlets would want to jump right into this game (they might, of course).

I do wonder, however, and hopefully someone who deals with contracts regularly (I do not) can provide insight into this - if ESPN has the right of first refusal and an exclusive window before open bidding, would this seem to imply that ESPN will probably have most or all of the coverage until the semifinals have been properly valued, at which time it may drop those perhaps? Of course, ESPN's bar on an excessive price might be mind-bogglingly high at this point.

wolverine1987

June 26th, 2012 at 12:44 PM ^

With which I respectfully disagree. Thoroughly. No TV network is paying that money to see Denard Robinson in the playoff. They are paying it because college football is a huge sport, and it would be exactly as huge even if the top 20 best players in the country never appeared in the playoff.

Don

June 26th, 2012 at 1:06 PM ^

Once they get the first season of playoffs done and are confronted with the task of counting the enormous mountain of money sitting in front of them, everybody involved—including the college presidents—will be saying, "why didn't we think of this before?"

 

GunnersApe

June 26th, 2012 at 1:55 PM ^

I think I'm in the minority here and possibly being a B1G/Michigan slappy when I'm taking the plus one stance. As coach Hoke pointed out if Michigan played another game they would have been without Molk/Martin. Add ten scholarships for depth and shorten the off time before the Bowls, thirty something days followed by a game then another in two weeks is alot IMHO, Two weeks after the League Championship games seem right to me except the guys in the funny color jackets get screwed.
Plus one off the top of my head would of solved Neb/UM 97, NEB/PSU 94, Aub/USC 04(?) I know there's more. As Shoe/Don pointed out this will not happen due to the river of cash that will be flowing. I guess I'm saying is baby steps or get rid of the bowls and go to a D-II format.

So in closing "GET OFF MY LAWN".

French West Indian

June 26th, 2012 at 3:42 PM ^

Why is another $5 billion even needed?  Like someone said above, it will just increase the volume of the arguments in favor of paying players (which I think is bullshit and unlikely to ever happen as long as it remains college football).

Since most of the relevant schools are state universities and because the sport is basically of national interest, what they should do is broadcast it on PBS, commerical free.  Unlikely to happen but I would love it if the university presidents made this a stipulation just as a giant "fuck you" to the ESPNs of the world.