Good morning, and thanks for spending part of your day with Extra Points.
Remember how you kept getting commercials during college football season from Cody Campbell, begging you to support legislation that would save college sports? The crux of Campbell’s message centered on changing the Sports Broadcasting Act to allow college athletic conferences to pool their television contracts and sell as one unit, like the NFL, NBA, and other professional leagues do.
Campbell believes this will generate substantially more broadcast revenue for everybody, enough new revenue to continue to operate Olympic sports programs, even as athlete compensation and operational costs grow for larger programs.
This concept was also addressed in the SAFE Act, a Democrat-authored Senate bill meant to address college sports reform questions that were ignored in the GOP-centric SCORE Act. SAFE would have adjusted the SBA to permit leagues to combine their media rights.
Here’s what I wrote when that bill was first introduced:
…I don’t have a strong opinion on whether combining the rights would actually lead to more revenue for everybody — or if it would be better for consumers. I don’t think there’s been enough reporting done to make me feel confident one way or another.
But let’s say Campbell and Cantwell are right, and one big ol’ supercontract does give more money to everybody. Why should the Big Ten and SEC go along with that plan, which would undermine their financial and political advantages? And how can anybody be confident that schools would take that windfall and actually use it to spend on Olympic sports, rather than just football?
Cantwell’s team told me they believe the bill’s requirements for schools to maintain Olympic sport sponsorships and scholarship allotments would be sufficient to push them to continue to spread their spending around. They also believe that the revenue growth and “efficient scheduling” options provided by a single contract would be enough to encourage the participation from all major leagues.
Is that true? I don’t know. If I were writing a bill to address this question, I’d probably push for requirements mandating certain operational budget allocations, rather than just scholarship or sponsorship requirements … but I’m not a lawyer or a lawmaker.
Well folks, wouldn’t you know it, but the Big Ten and SEC don’t seem to want to combine their media rights, even if they were allowed to do so. Both conferences hired FTI Consulting to produce a white paper that specifically targeted the assumptions in Campbell’s argument (and to a lesser extent, SAFE). You can read the whole thing here.
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I feel like there are two different arguments being made here: 1) Unifying all of college football into one media rights contract is too logistically challenging to be worth doing, and 2) unifying all of college football into one media rights contract won’t actually make everybody more money.
For argument one, we have (via the white paper):
…Of course, this (Campbell’s proposal) ignores the highly significant fact that these existing media agreements are long-term contracts between private parties, have values in the billions of dollars, and are not likely to be renegotiated voluntarily overnight. The goals of SCS can only be accomplished by abrogating those existing media contracts entirely, or substantially and materially altering the terms of those agreements. The abrogation of legally-enforceable and highly negotiated media agreements would be tantamount to nationalizing the college sports media market and would destroy valuable privately-held assets—with significant, potentially negative long-term consequences for future investments in the sector
I’d be open to an argument for why it might actually be a good thing for the federal government to nationalize college sports broadcast agreements. But if the intent is to push all of the major leagues together, leagues who agreements all expire at different times over the next decade, by buying those deals out or forcing changes… yeah, that does feel pretty close to nationalization. And that’s not going to be a neat or easy process.
Plus, it is worth pointing out that we’re talking about an inventory scale here that is beyond that of major professional sports:
Media pooling proposals assume that games will be “optimized” for higher quality matchups, with scheduling and broadcasting for all 136 teams controlled by a central authority that is free to override or ignore choices by individual schools and conferences. The complexity of scheduling upwards of 60 games per week, with limited national slots available, likely means most games would be relegated to streaming services or local broadcasters in some yet to be disclosed scheme.
I mean…that’s what happens now, in a world with 10 different broadcast agreements. I’d have to imagine that any nationwide hypothetical college football media deal would include multiple broadcast partners and tiers, because the game inventory is too much for any one company. But there is something to the argument that trying to manage 136+ teams and “optimize” their schedule for the right TV windows is a plan that sounds better on paper than it does in practice.
Who is right about what proposal would make more money? I don’t know, and I’m not certain it even matters. The right question isn’t being raised by either party.
I feel like I’ve studied these issues a little more than the average bear, but I know the broadcast market and consumption habits have changed significantly since the days of the CFA and the early years of the post-Board of Regents deregulation. But I also don’t know if there would be enough interested buyers, sophisticated enough infrastructure, and/or the political will to get a combined CFB TV package created and sold for more money.
It’s an interesting hypothetical. But I kinda think it doesn’t actually matter.
The Big Ten and SEC leadership would almost certainly not support deal consolidation, even if it did result in substantially more money for everybody. Because a world where all (or most) of major college athletics find themselves on similar financial footing from broadcast media is a world where the political power of the Big Ten and SEC is diminished.
It isn’t enough to make more money. What’s important is that they make more than the Big 12, ACC, and everybody else. Giving up that leverage isn’t worth an extra few million in every school’s pocket, because that new revenue isn’t as valuable if suddenly Syracuse, Utah, and Wake Forest can (mostly) match your spending.
I think Campbell understands that very well. Nothing would benefit a program like Texas Tech more than attacking the favored financial advantage that the Big 2 lord over the rest of college athletics. I don’t know if federal lawmakers understand that leverage the same way.
I am unable to imagine a world where the current P2 leagues voluntarily agree to combine media rights with the unwashed masses of the MAC, CUSA, and The American, to say nothing of the Big 12 or ACC. If that’s going to happen, it’s because somebody makes them.
And does anybody in political power really want to do that?
I’m skeptical. The SAFE Act, as I understood the language, was built more to facilitate the option of combined rights rather than requiring it.
Two weeks ago, Sen. Schmitt (R-MO) shared his proposed framework for a college sports bill. While Schmitt’s blueprint covers many other aspects of college sports reform, from providing limited antitrust exemptions to new transfer rules to attempts to impose actual salary caps, it also touches on media rights deals. Via the release, Sen. Schmitt calls for:
Maximizing Value in Media Rights: College football consistently attracts large national audiences, yet overall media revenues don’t match those of other professional sports leagues. This gap suggests there are real opportunities to modernize and optimize media rights deals in ways that grow total revenue.
Restoring Stability: Ongoing conference realignment shows schools are seeking greater financial predictability and competitive stability. Recent realignment decisions highlight the importance of examining what underlying financial incentives are driving these shifts.
Long-Term Success: Discussions around any potential proposals that open up or amend the Sports Broadcasting Act should focus on keeping college athletics healthy for the long haul. Can a review of how media rights are secured provide more schools opportunities to be more competitive, protect women’s and Olympic sports, and ensure long-term sustainability?
Not mentioned in any of Sen. Schmitt’s blueprint? Anything relating to "employment," “collective bargaining,” or "labor classification status.” Previous legislative efforts from Senate Republicans, mostly but not exclusively from Sen. Cruz (R-TX), have very much included language that would ban athletes from becoming classified as employees. I wonder if Sen. Schmitt’s proposal here indicates a potential thaw in GOP thinking.
Anyway, the idea that combined packages could limit nationwide conference realignment decisions, drive new revenues, and help facilitate some semblance of “stability” is one that I believe is shared by many lawmakers of both major political parties. But I’m not reading anything here about mandating anything. In fact, this statement feels a little more like “I’m just asking questions” than anything else.
And hey, ask away! Let a thousand white papers and economic projections bloom. But if anybody wants the Big Ten and the Mountain West to share anything, for whatever reasons you want, I don’t think an appeal to patriotism or economics or anything else is going to work. If you want it, I think you should be prepared to explain how you’re going to make it happen.
Of course, the United States just began another international conflict less than 72 hours ago. I suspect that Congressional conversations about broadcast rights will become a teensy bit less relevant once constituents start asking about War Powers resolutions.
But that’s a different newsletter.
