Amidst the Pac-12 Networks’ issues with carriage, fees, per–school payouts, event coverage and layoffs, and amidst the conference as a whole falling behind the rest of the Power Five financially (while paying commissioner Larry Scott a whole lot of money for that privilege), their hopes seem even more invested than before in getting a large TV deal in the next round of negotiations (their current primary rights contracts with ESPN and Fox expire after the 2023-24 season). And now, it looks like that deal may wind up not on linear TV at all.
John Ourand and Michael Smith of Sports Business Journal ran a piece Monday on how Pac-12 executives expect companies like Facebook, Apple, Amazon, Netflix and Google to make “serious bids” for conference rights. That piece included Pac-12 Networks president Mark Shuken saying “Several of them have come to us and said that they want to be in this space.” And most notably, that piece went on to discuss the idea of Apple in particular pushing for primary rights:
The most intriguing conversations have come with Apple, which so far has not settled on a financial model around sports rights. Apple executives have told conference and school officials that they see live sports as a programming genre that can set its direct-to-consumer business apart from its rivals.
During one meeting, Apple executives told the Pac-12’s school presidents that it was only interested in the conference’s primary media rights package, not a digital one. ESPN and Fox currently hold the rights to the conference’s main package, paying a combined $250 million per year on average to the conference.
“They said that they are very interested in learning more about the rights and learning more about the business to determine whether or not they’d be a viable partner in 2024,” Shuken said. “They said that, on the surface, we look like a good partner to investigate.”
Obviously, this is a million steps away from actually being a done deal, so Pac-12 fans won’t have to run out and sign up for Apple TV+ just yet. In fact, the “primary rights only” discussions may make it more likely that Pac-12 content never winds up there; carving out a supplementary digital-only package the way several conferences have done with services like ESPN+ is simpler than moving your primary rights to a streaming-only service. And Apple would have to outbid a lot of TV networks for the primary rights deal, and while they certainly have the money to, it’s unclear if it would be worthwhile for them; live sports is still a strong driver for TV and is worth a lot to those networks, and it’s not certain it’s as valuable to a tech firm (especially considering that the Pac-12’s inability to ever get their networks on DirecTV didn’t exactly say great things about how willing their fans were to switch services to get content).
Of course, the DirecTV/Pac-12 Networks situation isn’t entirely applicable; part of the issue with the networks is that they’re not primary rightsholders, but lower-tier rightsholders, so they often haven’t had much in the way of compelling games. And owning all the top games, as a company like Apple would in a primary rights deal, would be a much more notable argument to get people to sign up, especially if Pac-12 football becomes strong nationally again (not a sure thing). And getting people to sign up for a stand-alone subscription service is also easier than having them change pay-TV providers. But still, at this point, there are some questions about just how desirable these Pac-12 rights are, and just how much the top bidder (be that TV or tech firm) is going to pay for them.
The idea of the Pac-12 being willing to explore a digital-primary deal is certainly interesting, though. And while a digital-primary deal would likely mean less exposure for the conference (at least in the current landscape, linear TV is still much bigger than streaming services; just how much bigger may shift by 2024, though), having tech firms actively competing for rights could boost the bidding, and ensure that the eventual payday (whether from TV or digital) is significant. And there’s some logic to the Pac-12 exploring some unconventional distribution options, especially given that they’ve already had some talks with Apple and have gotten the Pac-12 Now app onto Apple TV. The conference also maybe needs to be a bit bolder than some others, as their current broadcasting setup isn’t exactly working out great (especially when it comes to the conference networks). So we’ll see if anything actually comes of this, but it’s definitely notable to hear talk of a Pac-12 digital deal for primary rights.
