College football writer Jon Wilner of MercuryNews.com has been examining the financial future of the Pac-12 this week in a multi-part series. On Thursday, he served up the money shot – literally.

Based on Wilner’s calculations, the Big Ten and SEC will enjoy a significant edge in TV revenue over the Pac-12 once the dust has settled in the latest round of media rights negotiations. In fact, Wilner indicates that all the wheeling and dealing done four years ago by conference commissioner and alleged visionary Larry Scott really just allowed the Pac-12 to not lose more ground to the big dogs of college sports.

When all is said and done, the Pac-12 will trail the SEC and Big Ten by between $10 million and $13 million annually on a per-school basis, according to Wilner’s projections. That’s in line with the gap under the Pac-12’s old, and much derided, TV contract inherited by Scott when he took over for Tom Hansen in 2009.

Wilner’s exact figures deserve a healthy measure of skepticism. I assume that even he’d admit that. Even so, the larger point of his exercise still holds true: The Pac-12 didn’t exactly cash in to the extent believed back in 2011. Wilner also identifies the root cause of the league’s financial lag: the Pac-12 Networks, which don’t boast nearly the same carriage rates or subscription revenue as the SEC Network or Big Ten Network.

Sounds bad for the Left Coast. However, here’s where it becomes important to keep in mind that the Pac-12 has a dramatically different business strategy.

The Big Ten and SEC conference networks represent joint ventures between the conferences and major broadcast partners FOX and ESPN, respectively. By partnering with FOX and ESPN, the Big Ten and SEC avoided the vast majority of the risk involved in starting their conference networks. They also availed themselves of the market power of the two major media companies in securing carriage deals with cable operators around the country. That greased the wheels for relatively painless negotiations with the Comcasts and DirecTV’s of the world. The trade-off is that FOX and ESPN have significant equity stakes in both networks.

Conversely, the Pac-12 Networks are wholly owned by the Pac-12. Aside from bearing all of the risk in starting the networks, the Pac-12 also lacks the heft of an ESPN to bully the cable operators. In that sense, a protracted battle over carriage was almost inevitable.

But the long-term payoff in going it alone will probably make it worth the short-term pain for the Pac-12. As the conference network does gain widespread carriage, the league won’t be splitting that money with anyone. More importantly, the Pac-12 is setting itself up to be a major force in the sports media landscape in the next decade.

The Pac-12’s current Tier 1 rights deals with FOX and ESPN sunset in 2024. By then, the conference will have a robust platform of seven conference channels at its disposal to go along with more than a decade of infrastructure and institutional knowledge built up. That would position the Pac-12 to cut the ESPNs of the world out of the picture entirely and keep all of its content in-house. As such, the conference would have massive leverage when it goes to the bargaining table. Furthermore, it gives the Pac-12 the flexibility to adapt to changing technology and content delivery as it sees fit.

So, yes, the Pac-12 will continue to lag behind the Big Ten and SEC in the conference pull-it-out contest for the time being. Consider it a worthwhile investment in the future.

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