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Conference expansion is a numbers game

3,070 Views | 28 Replies | Last: 4 yr ago by nukeaggie2000
agnerd
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For the 100th time, it's a numbers game. Until TV contracts stop charging more money to providers when a team from the state is on your channel, a state's population determines the TV value (and the total value) of a team for expansion.

SEC state populations before A&M and Missouri:

64,090,674
Divided by 12 teams = 5.3 million people per school

After A&M/MO:
99,223,983
divided by 14 teams = 7.1 million people per school.

You have to bring more than 7.1 million people to the table from now on to be a profitable candidate for admission. The following states qualify based on population:

1 California 39,512,223 USC, UCLA
4 New York 19,453,561 Syracuse
5 Illinois 12,671,821 Illinois Northwestern
6 Pennsylvania 12,801,989 Penn State
7 Ohio 11,689,100 Ohio State
9 North Carolina 10,488,084 NORTH CAROLINA NC state
10 Michigan 9,986,857 Michigan
11 New Jersey 8,882,190 Rutgers
12 Virginia 8,535,519 VIRGINIA Virginia Tech
13 Washington 7,614,893 UW Wazzu
14 Arizona 7,278,717 AZ, AZ St

Take out the Power 5 schools with crap football and you're left with the only viable candidates for expansion. If you care at all about geography (and SEC does seem to) North Carolina and Virginia are candidates 1 and 2. Guess who's NOT on the list...

edit to add Virginia Tech
Shoefly!
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Thanks Agnerd, that makes sense now.
1st Generation Ag
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And yet here we are. If it were simply a matter of mathematics the idea would be a nonstarter.
Sliced Clown Bread
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Why state population as the driver? Wouldnt a better driver be TV sets? Cant we easily measure that now with streaming services?
Jbob04
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Everyone still has the old line of thought when it comes to tv viewership. Streaming has completely changed the game
Bunk Moreland
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Oh look, it's another OP who is squarely in the know on how this all worked in 2011.
rootube
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agnerd
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Population IS TV sets. ESPN gets/charges more money from Comcast/ATT/YoutubeTv/SlingTv for every account in an SEC state that has the SEC Network channel, than accounts in non-SEC states. SEC network will get $0 in extra revenue by adding another Texas team, and they will now have to split the pot 15 ways instead of 14. It's only profitable to add non-SEC state teams until the entire cable business changes its revenue structure. Streaming is following the same revenue structure right now as cable.

Only exception to the rule is when a Conference like Big 12 is desperate to add strong teams to remain a "power 5" conference and they took TCU. WV over Houston was for the extra revenue.
merch
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This is why I'm confusedI guess I don't understand where the 100 million a year is gonna come from.
rootube
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Here's some math I can manage. We can start calling it the P4 soon.
ValleyRatAg
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SEC should make a real power play in this and take Ohio State and ND and crush Fox while also turning the Big into a dumpster fire similar to the BDF.
hunter2012
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Simple math:

First will be SEC without tu and panned out at 90 more years in the 100 year decision.

45M * 90 = 4.5 billion baseline that will only expand with future media deals.

Now let's assumed we let the sips in and make room for their arrogance but we get $10 M more for the trouble. Now we have to slightly alter the formula since they will blow up the conference and we'll be in a Mad Max era of college football after that. I'll be conservative and say it will take them 30 years to kill the conference, it could be sooner but I'd like to give them a fair shot

55M * 30 = 1.65 billion

As you can see with very basic math the $1.65B is just shy of the $4.5B we would stand to gain with a conference with better longevity.
oragator
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The cable box model is becoming less and less relevant in the new world. In part because folks are cutting the cord, but in part because the tier one and two fees are becoming so insanely high. And also because the future model will have more pay to watch for individual games, making fan base size and helmet recognition the larger driving factor.
The ABC deal for tier 1 is going to pay us 300 million a year for one freaking game a week now. That is more than half of the entire revenue from cable boxes across the entire country, and that's for one of our average of 7 or 8 games a week (albeit the biggest one). Those games will sell on national audiences, which both these schools bring, and longer term more PPV will mean it really won't matter if you have 6 schools from one state, as long as their fans buy the games. The new contract already calls for one or two of those a year per school.
But again even if we just broke even, we prevent the two biggest free agents from going elsewhere and potentially equaling or surpassing us as a league, which will keep us in the money each time a new contract comes up.

The league is a lot of things, but isn't dumb on money or what the future looks like.
mortal
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Well, here is one thing to look forward to. If these two join, the SEC will probably go to a 'four pod' schedule. We would rotate among the other pods and occasionally play them, but our permanent schedule would be tu, Oklahoma, and Arkansas. We are right back to old conference teams.
el_guapo
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oragator said:

The cable box model is becoming less and less relevant in the new world. In part because folks are cutting the cord, but in part because the tier one and two fees are becoming so insanely high. And also because the future model will have more pay to watch for individual games, making fan base size and helmet recognition the larger driving factor.
The ABC deal for tier 1 is going to pay us 300 million a year for one freaking game a week now. That is more than half of the entire revenue from cable boxes across the entire country, and that's for one of our average of 7 or 8 games a week (albeit the biggest one). Those games will sell on national audiences, which both these schools bring, and longer term more PPV will mean it really won't matter if you have 6 schools from one state, as long as their fans buy the games. The new contract already calls for one or two of those a year per school.
But again even if we just broke even, we prevent the two biggest free agents from going elsewhere and potentially equaling or surpassing us as a league, which will keep us in the money each time a new contract comes up.

The league is a lot of things, but isn't dumb on money or what the future looks like.
This. It isn't just cable tv population in a state. Ratings (eyeball watching games) earns money too. Advertisers will pay more money for highly watched games. Even thought tu is in TX and that doesn't add tv's, a tu vs LSU matchup would bring great ratings, increasing the revenue. Also, with streaming services coming, ratings will matter more because people will pay for individual games, not packages with cable tv.

The other SEC schools will know this and it may be hard for us to get 4 votes to block. I'm sure Sankey will play this card with all other SEC schools. Plus tu and ou in the SEC will dilute our recruiting advantage with Texas players. Our conference "friends" may see this playing into their hand. We may be left standing on Dissention Island all alone. Therefore we will abstain or vote Yes to avoid looking bad.
Gidnik
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Win At Life
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mortal said:

Well, here is one thing to look forward to. If these two join, the SEC will probably go to a 'four pod' schedule. We would rotate among the other pods and occasionally play them, but our permanent schedule would be tu, Oklahoma, and Arkansas. We are right back to old conference teams.
If we can't stop it, we should at least negotiate our pod as A&M, LSU, MSU, OM leaving tu, OU, MO and Ark in the other pod with out OOP permanent rival being tu.
Aggieair
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Swap Virginia Tech for Virginia and it's a good deal.
Lobster Twins
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Aggieair said:

Swap Virginia Tech for Virginia and it's a good deal.
This.

I've never gotten the love for Virginia from some on Texags.

Virginia Tech is a better fit in almost every category and will bring more eyeballs than Virginia. I don't recall anyone ever watching UVA football when I lived in Virginia.
hyt
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vt > virginia
cevans_40
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oragator said:

The cable box model is becoming less and less relevant in the new world. In part because folks are cutting the cord, but in part because the tier one and two fees are becoming so insanely high. And also because the future model will have more pay to watch for individual games, making fan base size and helmet recognition the larger driving factor.
The ABC deal for tier 1 is going to pay us 300 million a year for one freaking game a week now. That is more than half of the entire revenue from cable boxes across the entire country, and that's for one of our average of 7 or 8 games a week (albeit the biggest one). Those games will sell on national audiences, which both these schools bring, and longer term more PPV will mean it really won't matter if you have 6 schools from one state, as long as their fans buy the games. The new contract already calls for one or two of those a year per school.
But again even if we just broke even, we prevent the two biggest free agents from going elsewhere and potentially equaling or surpassing us as a league, which will keep us in the money each time a new contract comes up.

The league is a lot of things, but isn't dumb on money or what the future looks like.

So let's just add Miami and Florida State and be done?
rootube
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hunter2012 said:

Simple math:

First will be SEC without tu and panned out at 90 more years in the 100 year decision.

45M * 90 = 4.5 billion baseline that will only expand with future media deals.

Now let's assumed we let the sips in and make room for their arrogance but we get $10 M more for the trouble. Now we have to slightly alter the formula since they will blow up the conference and we'll be in a Mad Max era of college football after that. I'll be conservative and say it will take them 30 years to kill the conference, it could be sooner but I'd like to give them a fair shot

55M * 30 = 1.65 billion

As you can see with very basic math the $1.65B is just shy of the $4.5B we would stand to gain with a conference with better longevity.
This is not math, it's a cocktail insecurity and wishful thinking.
TMoney2007
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1st Generation Ag said:

And yet here we are. If it were simply a matter of mathematics the idea would be a nonstarter.
THEY expressed interest in joining. That doesn't actually mean anything by itself.
njohn87
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oragator said:

The cable box model is becoming less and less relevant in the new world. In part because folks are cutting the cord, but in part because the tier one and two fees are becoming so insanely high. And also because the future model will have more pay to watch for individual games, making fan base size and helmet recognition the larger driving factor.
The ABC deal for tier 1 is going to pay us 300 million a year for one freaking game a week now. That is more than half of the entire revenue from cable boxes across the entire country, and that's for one of our average of 7 or 8 games a week (albeit the biggest one). Those games will sell on national audiences, which both these schools bring, and longer term more PPV will mean it really won't matter if you have 6 schools from one state, as long as their fans buy the games. The new contract already calls for one or two of those a year per school.
But again even if we just broke even, we prevent the two biggest free agents from going elsewhere and potentially equaling or surpassing us as a league, which will keep us in the money each time a new contract comes up.

The league is a lot of things, but isn't dumb on money or what the future looks like.
It's this. Anybody who's still using geographic footprint and cable households is analyzing 2021 realignment with 2010 math. It's an entirely new ballgame now; it's about having a product that people who watch games will actually tune in to.
Bird Poo
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Most sip and OU fans have the SEC network just to watch A&M and real football. I don't get the argument that the network providers will gain all these viewers. How are they able to know that all these new users will sign up, let alone project that into actual revenues.
1976Ag
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Does anyone remember the poster from a few years back that was involved in the due diligence with Slive concerning what the SEC was looking for when they were reviewing Texas A&M? He gave an insider's view of the thoughts and discussions at that time around 2011. I think his user name was Junction___. He made some comments about the discussions around tu.
AWP 97
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mortal said:

Well, here is one thing to look forward to. If these two join, the SEC will probably go to a 'four pod' schedule. We would rotate among the other pods and occasionally play them, but our permanent schedule would be tu, Oklahoma, and Arkansas. We are right back to old conference teams.


Take us out and add Mizzou. Thank you
TMoney2007
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oragator said:

The cable box model is becoming less and less relevant in the new world. In part because folks are cutting the cord, but in part because the tier one and two fees are becoming so insanely high. And also because the future model will have more pay to watch for individual games, making fan base size and helmet recognition the larger driving factor.
The ABC deal for tier 1 is going to pay us 300 million a year for one freaking game a week now. That is more than half of the entire revenue from cable boxes across the entire country, and that's for one of our average of 7 or 8 games a week (albeit the biggest one). Those games will sell on national audiences, which both these schools bring, and longer term more PPV will mean it really won't matter if you have 6 schools from one state, as long as their fans buy the games. The new contract already calls for one or two of those a year per school.
But again even if we just broke even, we prevent the two biggest free agents from going elsewhere and potentially equaling or surpassing us as a league, which will keep us in the money each time a new contract comes up.

The league is a lot of things, but isn't dumb on money or what the future looks like.
The deal included more than just Tier 1 rights. It included the conference championship game for one big thing, a smattering of lower tier games and the remainder of basketball media rights,... All told, I think ESPN/ABC will be paying the SEC $450 million/year for complete television rights to SEC Football and Basketball.

Taking them on as a conference partner a short 10 years after we finally got away from them is some short sighted weak minded BS and we would deserve all the fallout that will come from it, especially for no more money. It's not some 5D chess Art of War move,... Its ridiculous on the face of it.
Caesar4
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1976Ag said:

Does anyone remember the poster from a few years back that was involved in the due diligence with Slive concerning what the SEC was looking for when they were reviewing Texas A&M? He gave an insider's view of the thoughts and discussions at that time around 2011. I think his user name was Junction___. He made some comments about the discussions around tu.
Not certain, but I think you may be referring to Kentucky Mustangs.
nukeaggie2000
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the numbers game, is setting up the SEC as the new tier 1 league with 30-40 teams in 10 years that pays all the starting QB's a million/year
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