How to think about Conference Realignment in 2019

So I have to admit, I’m really fascinated by this UConn/Big East story. It’s not because of any emotional investment I have in UConn football. Honestly, I regret almost every moment I’ve ever spent watching them play when it wasn’t literally part of my job. It isn’t just because I’m personally really interested in conference realignment, generally…although that’s certainly part of it.

I think it’s because this move flies against so much of the conventional wisdom about college football and conference relaignment... that football broadcasting revenues are more important than any other variable, that basketball has little value, and that a school could chose to be proactive, rather than reactive.

Is this going to be a trend? Not exactly, but I do think this is a good time to reexamine a lot of the conventional wisdom around this issue. A lot has changed since the Big 12 thought about expanding, and a lot of the stuff that was true back in say, 2016, is a whole lot less true today.

What is the conventional wisdom around conference realignment?

The general assumption in College Football Internet is that we’re highly unlikely to see more conference realignment until the mid 2020s, when the TV deals for the Big 12, Big Ten and Pac-12 expire. The thinking goes, Texas and Oklahoma would be the flight risks, given that they’re likely to earn more money in Tier 1 TV rights in the Big Ten or SEC, and the departure of either of those programs could cause the collapse of the Big 12.

Over the last few months, I’ve read at least a little chatter of teams potentially looking to leave the Pac-12, given the struggles of the Pac-12 Network, and rising revenue gaps  between the league and other major conferences.

This recent story from AZCentral at least broached the possibility , with one quoted analyst saying:

And if you’ve been on Twitter over the last few days, you’ve probably seen the report from somewhere called John Wall Street that at least one major UCLA booster is pushing for them to leave the Pac-12…for the ACC. That…is certainly a take!

The ACC has a grant of rights agreement that extends beyond the 2020s, and nobody leaves the SEC or the Big Ten, because the money is so good. So any major realignment scenario hinges on either the Pac-12, or the Big 12. At least, according to the conventional wisdom.

The rationale for expanding looks different now than it did a few years ago, and that should change things

Since the 1990s, major conferences have expanded for almost exclusively financial reasons, either to hold a lucrative conference championship game, to improve their major Tier 1 TV rights, or to expand their conference networks into different markets.

I don’t think that’s exactly the same thought process in 2019 and beyond, for a few reasons.

For one, there are operational difficulties with further expansion. We’ve had huge conferences before. The Southern Conference sprawled beyond 16 multiple times, spawning the SEC and ACC once it got too big. The WAC hit 16 teams before message boards made that sound cool, and then a breakaway group created the Mountain West.

Once you get above 14 teams, maintaining conference identity, and keeping everybody happy with scheduling, becomes more difficult. Already in the ACC and SEC, we see cross divisional teams that won’t see each other’s campus over a five year span, and unbalanced basketball schedules can have a real impact on NCAA seeding. Growing beyond 14, especially if doing so increases geographic sprawl or weakens institutional ties, has increasing negative effects, even if the TV money is good.

There’s also the idea that “markets” are substantially less important now than they used to be. A few years ago, if you had a conference network, adding a marginal team (like say, Rutgers) to gain access to a new TV market could make sense. Adding a crummy team could still get your network on basic cable packages in that market, giving you more money in carriage fees, whether locals watched the station or not.

Markets were a huge part of the Big 12 expansion narrative around prospective candidates, and if you look at the argument for most schools to replace UConn in the AAC, you’ll see the same. Schools like UAB, Old Dominion, Charlotte, Georgia State, are all in relatively large, (or underserved) TV markets. The argument goes, essentially, you invest in a school that has the potential to reach a lot of people in a market, you can can improve your own TV deal, or increase exposure in that market.

That wasn’t really that true back in 2015 with the Big 12 (the Big 12 didn’t have a TV network, so exposure in Memphis or Orlando didn’t matter), and it’s even less true today.

Cable cords are being cut by consumers en masse, removing the carriage fee advantage. Across most of college football, but especially at the Group of Five level, we’re seeing a movement towards more events being placed on streaming services, like ESPN+. At that point, your TV market doesn’t matter. All that matters is your ability to deliver eyeballs and ESPN+ subscriptions. And that requires an established fanbase, regardless of your geography.

The institutional profile of most Group of Five type schools isn’t built to take advantage of that kind of system. Many of these schools are regional, secondary public schools, rather than state flagships, and struggle to establish the same sort of fan fervor (as an example, I’d bet there are more people who identify primarily as Ohio State fans on Kent State’s campus than Kent State football fans). Many are commuter colleges, or schools with high international or non-traditional student enrollments, populations that are less likely to become hardcore college football fans.

The fact that the AAC appears reticent to add anybody from Conference USA, the MAC, etc, seems to bolster the argument that the financial value, media-wise, for most of these programs is very small.

Simply put, it doesn’t appear there are many attractive candidates for any school to get “promoted” a level, either from the AAC/MWC to the Big 12, or from the rest of the Group of 5 to the AAC, clearly the best G5 league.

But that doesn’t mean I think realignment is unlikely or impossible. I just think it’ll be for different reasons

The story about realignment before has been about getting bigger. I think over the next few years, it’ll be about being smaller.

The economic realities of college football are changing. Costs are rising, from skyrocketing coaching salaries, to increased health care costs, to player compensation costs, all while attendance, especially at the G5 level, is falling. If you look at scanned tickets, not the official numbers, several schools are bringing in less than 20,000 fans a game. These factors all present a pretty challenging economic future.

It’s worth noting that all of these headwinds are happening during relatively good times, economically. What happens if fuel prices spike in the next few years? Or if we hit a recession, and entertainment spending craters? Or if state support for higher education falls off even more significantly?

I’ve previously written that because of all this, I think more schools should look at dropping to FCS. For a variety of reasons (alumni pressure, ego, misunderstanding the costs and benefits, lack of suitable FCS options, etc), I don’t think many schools will take my advice.

But if the margins are getting thinner and thinner, I think we could see some conference movement as schools realize what they were doing before isn’t working.

The most obvious place is with Conference USA, a league that is big on markets, but short on anything resembling established brands. To the extent it has a geographic footprint, it mostly overlaps with the Sun Belt. Neither league gets much in the way of TV revenue, and both have several schools that are struggling badly to sell tickets.

I could certainly see a future scenario where the two leagues change some membership  to create much more geographically concentrated divisions, or even entirely new leagues. Can UTEP continue to justify playing most of their league games over 500 miles away? Can Texas State do the same, when most of their obvious rivals are in Conference USA? What about UAB, and their fellow in-state institutions in the other league?

I also wonder about the calculus of being an independent. Anybody not named Notre Dame knows that going independent means kissing any shot at the College Football Playoff goodbye, and anybody not named Notre Dame or BYU won’t play in anything close to a decent bowl game as an independent. But that’s true for most Group of Five programs whether they’re in a conference or not. Is there a point where, financially, going independent, playing all of your football games on Saturdays, and just playing a hyper-regionalist schedule becomes more profitable than say, playing in the MAC and not getting a Saturday home game after week seven?

Right now, I think the answer is no. In 2023? Depending on what happens with the rest of the country? Maybe that’s a different story.

I wouldn’t be shocked if at least one program decided to deemphasize football before the 2024/2025 media deals expire. And I wouldn’t be shocked if membership in the Mountain West (who, btw, has already been linked to multiple expansion rumors), Conference USA, or the Sun Belt changed in the next few years. Those moves wouldn’t be to further grow TV revenues, but rather, to control travel costs, or to hope that increased fan spending, engagement, and local control would trump modest TV earnings.

Also, football isn’t the only factor. At the lower levels, basketball really matters too

At the P5 level, football really is king. The demand and financial worth for football far outstrips anything else.

But for G5 conferences, that isn’t necessarily the case. The commercial value for basketball broadcasts is pretty modest, but the financial value of getting into the NCAA Tournament is not trivial at all. Over the coming years, the value of a single NCAA Tournament “unit” will be worth close to $300,000 a season for six seasons.

If your TV deal for football is relatively modest, reliably becoming a multi-bid college basketball league could be almost as financially lucrative for your conference. It’s why the Mountain West pushed so hard for Gonzaga (and looked at potentially adding some other basketball-focused schools). It’s why the AAC added Wichita State (and hell, could add VCU).

It’s going to be harder and harder for non power leagues to get multiple bids to the NCAA Tournament, with so many leagues decreasing the number of non-conference games they play (Big East, Big Ten, Pac-12, etc). One potential way to combat that would be for other leagues to consolidate capable basketball teams as a way to improve their NET scores.

Could I see a world in the near future where a MAC, or Conference USA, or maybe even a power conference decided to add an affiliate member, or a member with an otherwise less desirable football program, thinking it would improve their NCAA Tournament financials? Yes. I think that could happen.

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For what it’s worth, I’m actually pretty skeptical major conference realignment even happens in the middle part of the decade. I don’t think major forces outside of ESPN and Fox will be prepared to be serious bidders for TV rights, and I think there are too many other factors beyond just pure Tier 1 TV money to keep the Pac-12 and Big 12 intact, for better or worse. Inertia is a powerful force, even in college football.

At any rate, the desire to grow those fat TV revenue contracts or market exposure aren’t the only factors at play here. For plenty of FBS schools, no gravy train is coming. Going smaller, at least in terms of their costs, could be the move instead.

And that might require some moving around. Just ask UConn.

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