Now in year two, SEC Network finds itself worth more than Big Ten Network

In its first year of operation, SEC Network has surpassed expectations in terms of market penetration and market value. Starting last August and made available in 90 million homes, SEC Network had one of the widest cable launches in history. And thanks to its subscriber fee that averages $0.66 in the conference footprint (as high as $1.40 depending on the provider) and $0.25 outside the conference, SEC Network was able to gain a market value of $4.77 billion in just its first year of operation.

Compare that to Big Ten Network which was established in 2009 and has a market value of $1.59 billion.

Now why has SEC Network been a runaway success compared to BTN and Pac-12 Network which started in 2012? The SEC chose to wait to begin its own network to see how the other channels would get off the ground. While the Big Ten and Pac-12 had trouble getting their networks widely distributed by the cable and satellite providers, SEC chose to bring ESPN on-board to totally own and operate its network. While the Big Ten owns less than half of its network with Fox taking the other portion, Pac-12 chose to go it alone without a partner.

With ESPN in tow, the Worldwide Leader did the heavy lifting and negotiated with the providers. It was able to bundle SEC Network with its other networks to gain favorable carriage agreements. Also, instead of the league operating the network, ESPN and the SEC chose to share revenue, close to a 50-50 split which allows the cash to roll in at the league offices. ESPN takes the risk while the league waits for a check.

Last year, some of the cable and satellite providers chose to play chicken over SEC Network and found the league’s rabid fan base was not one to mess with. Rather than wait to see if ESPN would lower its fee, the companies elected to bring SEC Network on-board in time for the Ausgust 2014 launch than risk a subscriber mass exodus.

So based on these and other factors, the network became an overnight sensation and garnered a bigger market value than its more established rivals. As Pac-12 hopes to pick up its final major provider in DirecTV and Big Ten looks to renew some of its original agreements, the SEC and ESPN can rest assured knowing that their carriage negotiations won’t be coming for a while and the two can focus on ensuring the network’s survival well into the mid-2030’s and beyond.

[AL.com]