The
revenue gap is widening and the product has tailed off. Is there a way to fix
what’s ailing the Pac-12?
Commissioner
Larry Scott argues that the narrative about the conference’s struggles doesn’t
paint the entire picture
By
Christopher Kamrani, Salt Lake Trib 7/27/2018
….
Los Angeles: Larry Scott, as Larry Scott does, dug in.
When it was his turn at center stage during Wednesday’s
Pac-12 Media Day in Hollywood, the Pac-12 commissioner went on the offensive
when asked why the conference has fallen so far behind the other Power 5
leagues in terms of revenue and other metrics. The subject came up because,
well, that has pretty much been the national narrative about the Pac-12 in what
has been a nightmarish year for the conference.
Pac-12 teams went a historically bad 1-8 in bowl season.
(Utah fans won’t miss an opportunity to remind conference cohorts who saved the
league from going epically bad).
No Pac-12 team made it out of the first round of the NCAA
Tournament.
The ongoing drama surrounding the Pac-12 Network and DirecTV
seems it will never die. Scott did say Wednesday there’s no update on that, so
DirecTV subscribers, once again, must find another way to tune into Utah or
other Pac-12 games when they’re being broadcast on the conference’s network.
And then it was unveiled that the Pac-12 came in at No. 5
out of the Power 5 Conferences in terms of revenue at the end of the spring.
“I’m confident our schools have the resources they need to
continue to win championships more than any other conference,” Scott said. “I
see no sign of it slowing down.”
The Pac-12 commissioner pointed to what he normally points
to, some of it very valid: No other conference wins as much as the Pac-12 does
across the board on an annual basis. The conference has a dozen national title
contenders in any number of Division I sports every fall, winter and spring.
Scott pointed to the fact that no other conference has producee as many
Olympians or gold medalists as the Pac-12. At the 2016 Olympics in Rio de
Janeiro, Pac-12 affiliated athletes won 55 medals.
But this is almost always a football and men’s basketball
discussion, given that those two sports deliver far and away the most revenue.
Scott knew that was coming, so he got out in front of it.
He acknowledged that some fans might not care that Oregon
State won the College World Series or that USC won a track & field title or
that UCLA won the gymnastics crown, but the Pac-12 schools do. Scott said, in
total, Pac-12 schools have combined to invest $1.5 billion in the last decade
in capital improvements. Every school, he noted, has now upgraded its football
facilities.
“There’s no example I can point to in football or basketball
that our schools have not been able to invest how they want to,” Scott said.
However, Pac-12 schools average about $30 million in revenue
each year, a little more than $10 million behind the average SEC school. In an
interview with CBS Sports in May, Washington State president Kirk Schulz said
bluntly, “we’re falling behind.” Schulz added in an interview with USA Today
schools must stop worrying what the Pac-12 is providing and “start doing some
of our own creative things to bring in additional revenue.”
The SEC, Big Ten, Big 12 and ACC are financially in better
shape than the Pac-12 and there are a bunch of reasons why. But many point to
the beleaguered Pac-12 Network, which paid out a reported $2.5 million per
school last year. Scott, boasted Wednesday — as he often does — that the
conference has positioned itself quite well because it currently owns its own
network and with the rise of digital streaming, the conference is in good shape
to maneuver the next step.
But the numbers don’t lie. The Pac-12 takes in significantly
less money from its network than the SEC and Big Ten do in their shared network
arrangements with ESPN.
The Pac-12 is in its seventh year as a conference and with its
network. Not much will change in the near future, because most of the P5
conferences are in the middle of their current network agreements. Scott
foresees a “period of stability where you won’t see revenue changes up or
down.” But come 2024, those deals will expire and the Pac-12 will have options.
Scott said he “couldn’t be more delighted” that the Pac-12
is the only conference in the country to have complete control of its media
rights and that will allow itself to adapt and take advantage of the new media
landscape, he explained.
There is also the painful topic of late Saturday night
kickoffs.
Most of the Pac-12′s current prime time matchups kick off at
7:30 p.m. Pacific or 8:30 p.m. Mountain, with the games not ending until 2 a.m.
Sunday morning on the East Coast. The conference can’t do anything about time
zones. The fear is, if and when the league produces a national title contender,
it too, could wind up playing in the wee hours at a time of the season when
national exposure will make all the difference.
Football, fair or not, is the driving force behind most all
athletic departments. The conference’s product in recent years has struggled.
Outside of Washington’s inclusion in the 2017 NCAA College Football Playoff, it
has been, well, kind of thin as of late. In an interview with the Salt Lake
Tribune last month, new Utah athletic director Mark Harlan was asked how the
Pac-12 can close the revenue gap that appears to be widening versus the other
Power 5 conferences.
Harlan said it’s cyclical, largely dependent on how
high-revenue sports can fare on an annual basis.
“It just seems that every now and then a conference will
bring in more money and then the next year, another conference will bring in
more money,” he said. “The Pac-12 has a great product. I see only great upside
going forward.”
The Pac-12 currently has four major sources of revenue: bowl
money, TV rights deals with ESPN and FOX, the Pac-12 Network and March Madness
earnings.
Scott says he is well aware of the Pac-12′s revenue
shortcomings vis a vis the conference’s P5 rivals, and remains “laser focused”
on creating new income streams to help close the gap. But money, Scott insists,
isn’t the Pac-12′s only measure of success.
Which is true. One good, turnaround year, with a Pac-12
football team earning a a national playoff berth or a conference team or two
making a deep run in the NCAA Tournament, will almost certainly shift the
national narrative about the league.
Yet, the numbers tell the larger tale. And unless that is
eventually addressed, the Pac-12 runs the risk of falling farther behind.
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