Update on the media rights landscape:
First, a reminder of where we were a month ago:
https://www.actionnetwork.com/ncaaf...cf-negotiating-settlement-to-join-big-12-2023
- That AAC deal is done, lawyers are haggling over verbiage and indemnification plus payment terms, but it's done.
- Expect the following dominoes to fall in the coming days/weeks/months that will likely see UT and OU depart the Big 12 after this athletics season and ahead of the 2023-2024 season:
--- The Big Ten has finalized their new media rights deal, FOX has retained most of it. The last critical variable at play was whether CBS would bid (and would FOX decide not to counter) on the "premier Saturday package" that would see one Big Ten weekly game on linear CBS instead of the current SEC game, which is moving to ESPN. Reminder: FOX now owns a majority stake in the Big Ten Network, and they have the right of first refusal on any/all rights negotiations with other rights holders. In other words, FOX could choose to own 100% of all Big Ten rights if it wants to, but the league can still seek competitive bids if they want (and they did).
--- The SEC is waiting on the Big Ten... Why? In part because ESPN needs to know how much content they will or won't have going forward (budgeting) from the Big Ten, and in part because they are waiting to see if CBS wins out in their bid for the premier Saturday package. If they do, ESPN and CBS already have the terms worked out so that ESPN can buy out CBS' final year of their contract with the SEC (2023-2024 athletic year), thus all SEC content will be on ESPN networks effective next year, vs 2024-2025 which was the current expectation. If CBS does not win that Big Ten bid, I expect CBS to hold onto that Saturday game which is a GREAT deal for CBS.
--- Once this gets resolved, the SEC will finalize a new deal with ESPN which is already done on paper, except for a few T&Cs, and I expect Texas and OU will officially request to leave the Big 12 early (after this 2022-2023 season), which is two years earlier than their rights agreement with the Big 12 allows for. On paper, they will owe approximately $60 million each (or $120 million total for both schools), but that will likely get negotiated down to roughly half that or so I imagine. This allows the SEC to achieve their best-case scenario (presuming the CBS deal is also done) and have their full league and content slate arranged starting with the 2023-2024 season.
--- Then starts the hard work of negotiating a new rights deal for the Big 12... ESPN and FOX will be in the first position, and though the remaining 8 teams from the old league will enjoy an $8 million cash infusion to help offset the departures of Texas and OU, the league's ongoing rights are simply not going to be as valuable, which necessitates a new deal from the rights-holders perspective. The PAC 12 is also out hunting for a new deal, but their pursuit is further complicated by the PAC 12 Network which needs a home... Apple and ESPN are the biggest pursuers here. I could also see FOX getting involved, as they discussed purchasing/partnering on distribution in the past (as did ESPN), but the PAC 12 wasn't open to that deal then... are they now? Also, how much $$ will FOX have after the Big Ten deal? If they buy out all Big Ten rights ($$$), going big with the PAC 12 would be tough.
The new Big 12 would benefit from exercising their first-mover advantage and, if able, extending with ESPN and Fox for roughly five more years or so... Some figures have been exchanged, and from what I understand they aren't half bad for the Big 12 (from my perspective). The league could decide to wait it out, with the cash from Texas/OU plus the buy-in savings from the four new members the remaining eight teams won't see too much of an immediate financial hit, but the longer you wait the more likely it is you won't have a dance partner at the end of the day... College sports rights aren't what they were three years ago, there is still a healthy market but mostly for top-level teams and brands, which the new Big 12 is short on. We shall see what happens.