League-owned networks have become the rage whether in professional or college sports. They can prove to be very lucrative ventures and be a continuous revenue stream.
For the Big Ten and SEC, their channels have proven to be cash cows. Media giants ESPN and Fox have partnered with those conferences to run the networks and they have generated plenty of cash their member schools.
According to Sports Business Journal, ESPN’s complete ownership of the SEC Network and Fox’s 51% piece of the Big Ten Network are paying out $5-7 million to each of the conference schools. The Pac-12 Networks which are run in-house and don’t have a media partner pays out just under $1 million per school.
In addition, Pac-12 Networks which haven’t been able to get an agreement with DirecTV unlike the Big Ten and SEC Networks doesn’t have as wide distribution as the other two.
The jury is out on whether the Pac-12 in-house model can generate as much revenue for its schools as the other networks. Conference commissioner Larry Scott says his approach will work in the long run as opposed to getting the cash up front:
Scott has maintained that the conference is more focused on control of its own property over the long haul versus short-term revenue boosts.
“We’ve been big believers in our members ultimately controlling as much of their rights as possible that will benefit them for the long term,” Scott said. “We’ve seen a significant uplift by continuing to bring more rights to the center and, in the long term, our schools want to control their rights and intellectual property as much as possible.”
Part of that approach is for the Pac-12 to potentially take all of the schools’ multimedia rights in-house as opposed to having the individual colleges and universities selling their local rights to IMG, Learfield or other third parties. This has been a model that has been in place for many years, but Commissioner Scott is looking to blow up that tradition in hopes of generating more money for the conference and member schools.
It’s not known if that will work as opposed to the the traditional model, but as mentioned, Scott feels the in-house way will work eventually.
Right now, the Pac-12 continues to run behind the Big Ten and SEC in revenue from their networks. We’ll see if the in-house model will work or if Scott will have to bring in ESPN, Fox or even NBC to help run the network.