Big Ten Conference expansion: College sports musical chairs game is about to begin
MONDAY, 07 JUNE 2010 11:37
BY EVAN WEINER
Barry Alvarez is the Chief Economic Officer of a business that brings in over $90 million annually in Madison, Wisconsin. Alvarez has admitted the business, which is part of a business that has 10 active partners in various endeavors and another "silent" partner in the Midwest, doesn't necessarily need to take in more partners but could be forced into an expansion of the business in order to maximize revenues.
Alvarez is the Athletic Director of the University of Wisconsin, a school that belongs to the Big Ten conference, and Alvarez is looking for more money to fund his athletic program. He is not alone, the other 10 active sports playing members of the Big Ten want more money and the way to get that is by increasing the cable TV network that the schools along with the University of Chicago co-own with FOX Cable TV.
If the Big Ten adds more schools, the conference probably will be able to add to the growing cable TV network and reach a goal of 60 million subscribers. If the Big Ten hits the 60 million number and gets two dollars a month from each one of those subscribers, that means that particular college sports conference will bring in $120 million a month or close to $1.5 billion a year from cable TV programming.
"You know what, there are some interesting things going on, interesting discussions, you know there is a possibility of major change," said Alvarez.
Interesting things? According to reports the Big 12 wants to know whether Missouri and Nebraska are jumping to the Big Ten by this Friday. The Pac 10, which hired the powerful Hollywood reps, Creative Artist Agency, is looking to expand beyond the Pacific states. A former NFL insider said on Friday that former NFL Commissioner Paul Tagliabue is working extremely hard on plotting the future of the Big East, a conference which includes Rutgers.
Is Rutgers headed for the Big Ten? Is Rutgers going to stay in what remains of the Big East or will the school head to the Atlantic Coast Conference?
No one knows at this point. But changes are coming.
"I think there is a history of change," said Alvarez. "This isn't something new and you can go back and study the NC two A, study college athletics and see there has been expansion before. You have people (CAA, Tagliabue) to think outside the box and trying to make things better. Continue to tweak things. And I think this is just part of the process."
A couple of days ago, it was thought the Big Ten was the linchpin and other college conferences would react to whatever the conference was planning. But other conferences are also playing the change game and the Big Ten may not get first dibs on schools like Missouri, Nebraska, Texas, Syracuse, Pittsburgh or Rutgers.
"The Big Ten doesn't need to do it," said Alvarez of expansion. "I think our Commissioner (James Delany) is looking to continue to improve the Big Ten and make things better. He's a guy who thinks outside the box and so I think this is a natural progression.
"I feel comfortable in looking into the expansion. I think there are a lot of things that make sense and I have a lot of confidence in our commissioner and in our (the colleges and universities) presidents and they're the ones that make the ultimate decision."
The ideal fit in football and athletics for Wisconsin and the other Big Ten schools is Notre Dame. The school is a football factory and can easily be accepted into The Committee on Institutional Cooperation which is the Big Ten's academic component. The Big Ten has to not only weigh the football/basketball and other sports programs but academics as well and that might be a problem for some of the schools that might be courted by Delany.
"I am working on that scheduling right now," said Alvarez who would like to get Notre Dame to play in Madison as an independent. "I don't think there is any secret, all of us would love to have Notre Dame in our league, I think it is a natural. And so, whether it will happen or not, I don't know but I sure would like to see it. (Notre Dame) will have to sit back and take a look at what is going on nationally, if there is expansion and it affects a number of leagues and all of a sudden maybe you have four big leagues. You know four 16-team conferences, when the music stops, you better have a seat. I'm worrying about one conference. Big Ten
"I don't know how the Big East will be affected or if it will be affected. I don't know enough about the Big East."
The Big Ten Commissioner Delany will meet with the heads of Illinois, Indiana, Iowa, Michigan, Michigan State, Minnesota, Northwestern, Ohio State, Penn State, Purdue and Wisconsin along with the University of Chicago and lay out various proposals. The conference could add one, three or five teams or sit at 11. Each school in the Big Ten is getting $22 million a year from the Big Ten Network and that could go depending on geography. Rutgers is in a Comcast state and more than likely, the Big Ten Network would pick up New Jersey subscribers from Comcast but it is unknown whether Charles Dolan's Cablevision or Time Warner would take the Big Ten Network in the New York area. But Delany may look to expand the TV network in the south, not the New York area and that could mean that Texas is the prize.
"That's what Jim will talk to the presidents about," said Alvarez of the Big Ten meeting. "I think he will give them information, they will discuss it and decide what direction they will go."
Alvarez was a football coach who is now really playing with the big boys. A football school like Wisconsin attracts big time TV contracts, sneaker deals, major marketing partners, well heeled alum, well heeled boosters, luxury box owners, club seat patrons and a whole host of other people who are both looking to make money off of a school and also make sure the school is producing winning teams in the big revenue generating sports such as football and basketball and in Alvarez's case, hockey.
"Basically I am running a $90 million company right now," said Alvarez. "We take no (Wisconsin) state funding, we are self-supporting, the engine that drives the train is football. We have 23 sports and 800 athletes and you have to pay the bills for the sports, coaches, etc. etc. It is important to find new money streams and ways to finance your programs. Football is the engine because of the TV money, 80-thousand seat stadium in our case but football generates the majority of the money. We profit share in our league and our TV contracts are second to none."
TV contracts second to none may be the most important words Alvarez uttered. The Pac10's deal with FOX is done after 2012 and suddenly far away schools from the Pacific coast like Texas, Texas A&M, Texas Tech, Oklahoma, Oklahoma State and Colorado or Baylor are attractive. Pac 10 teams receive an estimated $8-10 million from the present FOX deal; Southeast Conference deals get more than $17 million while Big East teams get about $7 million.
Big time college sports is all about money, there is literally a pot of gold available from the beast, cable and broadband TV, and that beast needs to be constantly fed. Boise State could be end up in the Mountain West Conference, a group of schools that in 2006 launched a TV network in the Rocky Mountains area. That cable network is partially owned by CBS and has programming on Versus. TV drove the last college conference realignment about seven years ago and it is the guiding force behind this one.
Evan Weiner is an author, radio-TV commentator and speaker on "The Politics of Sports Business:" and can be reached at firstname.lastname@example.org