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Feb
10
2016

What the Los Angeles Clippers disappointing TV rights offer may mean for the ACC.

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We’ve been wondering for awhile when the Cable Sports Bubble was going to burst. There have been concerning numbers from ESPN for awhile.  Now we are hearing reports about the Los Angeles Clippers disappointing TV rights offer from Fox.   This is from the site Forbes.Com.

Last September, Fox reportedly offered a $60 million a year deal for the Clippers local tv rights. Ballmer rejected that offer and asked for $100 million and was even entertaining the idea of streaming Clippers games in a Netflix-like system…

…As a result, Fox rescinded its $60 million offer and has come back with a lower bid–somewhere in the low-to-mid $50 million range–according to one league executive.

Uh oh.

Do we remember when the Big East rejected a TV rights offer from ESPN, and soon after fell apart? That’s important lesson about overplaying your hand. Now we are an ACC centric blog, so does mean anything to the ACC and their quest to start a network?

Let’s start with the good news. The ACC is locked into their Television agreement with ESPN until 2026-2027 season. That means the ACC isn’t going out for bidding at a low point. The Big 10 is currently renegotiating their TV rights deal that will run out in 2017. Outlandish projections of $30 Million per Big 10 team seem unlikely. Certainly the Big 10 is valuable and will get an increase from their current deal. How much more is the question, and would it have been higher 2 or 3 years ago?

Let’s get back to the network. Do I think the apparent industry climate affects the ACC Network? Somewhat, but not entirely. I think what it has done is make the move more measured.

From the Forbes article again…

( the Astros were supposed to get a rights fee averaging $80 million a season). But carriage and ratings were terrible because the RSN wanted to charge carriers too much.

Especially in this environment ACC\ESPN can’t rush into a network. They may risk running turning into another Longhorn Network, or suffer the carriage issues the Pac 12 Network is struggling with.

That said the Oklahoma president David Boren said a Big 12 Network could pull in $4-6 Million as last week.   Even the most pessimistic ACC critic can’t convince me that the ACC won’t pull in at least half of that. There is still money to be made in a conference network apparently.

Remember the Pittsburgh just a few weeks ago sounded bullish on an ACC Network.  Those itching for an ACC Network, like myself, realize the the conference needs a revenue generator, but must also understand that the current conditions probably added a little time to the schedule.

Don’t think ESPN and parent company aren’t starting to figure out alternatives to cable either. 

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