Quick quiz: Which major conference college commissioner is paid the most, was recently extended a new contract for five more years and oversees by far the least valuable league TV network in the nation?
No fair if you've been a Peristyle member for at least three months. You almost certainly know the answer.
Larry Scott, call your Walnut Creek office or maybe your San Francisco Embarcadero studios.
The numbers are in and they're really not looking good. Check that. No way any sentence about the Pac-12 Network (Yeah, we know they like to refer to themselves as the Pac-12 Networks but they're not, really) should have the word "good" in it. There's not much good about it.
Not when you compare it to the two powerhouse performers the SEC and the Big Ten have put up against it. And when the ACC's goes up in 2019, we're not convinced the Pac-12 can hold on to a top three spot -- which it owns because there are only three major conference networks.
But right now, all the Pac-12 has to show for a whole lot of fancy investment, a whole lot of talk that they're doing it the smart way, their own independent way and a way that will surely pay off somewhere down the line looks like the biggest piece of flim-flammery since Dorothy pulled back the curtain on the Wizard of Oz.
If there were a trophy for the Pac-12's TV efforts going into their sixth year, we'd recommend a participation trophy. That's all.
We say this after checking out the AL.com detailed look last week into all things college-TV-related that has folks shaking their heads at how the Pac-12 is actually in worse shape than we all thought it was. And in worse shape than the Pac-12 presidents must have thought it was when they extended Scott's contract through 2022 when they met in Las Vegas for the Pac-12 basketball tournament.
Las Vegas may have been the right place to be making a long-shot bet that that Larry will live up to this praise from the Pac-12 release describing his contract extension and the accomplishments that earned it for him: "Scott also delivered a landmark media rights agreement with ESPN and Fox and created Pac-12 Networks, the first-ever integrated media company owned by a college conference," it said.
What it did not say was this as reported by Al.com from a valuation developed by the SNL Kagan folks who crunch broadcast media data like no one else. The SEC Network, not three years old, has a value of $4.692 billion -- that's billion with a "b" while the Big Ten Network, a year older than Pac-12 TV, is worth $1.142 billion.
And the Pac-12, you ask? After all it has the "first integrated media company owned by a college conference." Well, the Pac-12 Network is worth a mere $305 million -- that's with an "m." To say that the Pac-12 is not playing in the same network ballpark with the SEC and Big Ten doesn't begin to express how far behind the league is when it comes to monetizing its broadcast platform.
And yet the Pac-12 release says that "These developments provided much-needed revenue while also dramatically increasing exposure for the conference's athletic programs and enabled the creation of innovative digital mobile platforms for Pac-12 content." Nowhere does the release go into hard numbers but they're hard to read if you care about the Pac-12.
As the first conference commissioner to make both $3 million annually and then $4 million, making him the highest paid commissioner above the Big Ten and SEC leaders, Scott presides over a Pac-12 staff with a half-dozen executives making more than a half-million dollars each with Pac-12 Network president Lydia Murphy-Stephans at $1.25 million at last reports before tendering her resignation some 10 days ago to start her own consulting business whose first client -- ta da -- will be the Pac-12 Network.
But while the Pac-12 salary numbers beat everybody's, its performance -- in ratings and financials -- do not. Both the SEC and Big Ten have already been paying out some five times the $1 million the Pac-12 Network is reportedly distributing to league schools this year with projections of much more in the near future. Here are some reasons why.
The first is basic as the AL.com quotes AT&T U-verse VP for Content Ryan Smith: that "subscriber intensity for SEC sports was off the charts for what we normally see for sports." And no way the Pac-12 gets to where the SEC is. But here's how that translates financially, Al.com says according to SNL Kagan: The SEC gets a monthly subscriber fee averaging out at $0.71. That compares to $0.41 for the Big Ten, which like the SEC, can claim more than 60 million subscribers.
The Pac-12? For its 15 million or so subscribers, the Pac-12 gets an average $0.36 according to SNL Kagan's most recent data. Not a math major or an accountant but that's a big, big difference. Looks like the Pac-12 could be generating something above $64 million annually in subscriber fees to the SEC's $536 million or so. Is that "cutting edge" as the Pac-12 calls itself when it comes to TV? Not exactly.
Now maybe that's not fair comparing the Pac-12 to the SEC Network since the SEC is the fifth-most expensive sports network -- behind only ESPN ($7.21), NFL Network ($1.39), FS1 ($1.15) and ESPN2 ($0.90).
And the Pac-12? The Pac-12, while the sports network with the lowest distribution in the top 20, down below BEIN Sports (24 million), Fox Deportes (22.5 million) and BEIN Sports Espanol (18.25 million), the Pac-12's $0.36 per subscriber is No. 9 overall right behind the Big Ten Network's $0.41 per for 65 million subscribers, the Golf Channel's $0.37 for its 76.23 million subscribers and ahead of the NHL Network's $0.33 per for its 38 million subscribers.
So you have to figure both numbers. The Tennis Channel, for example, gets just $0.15 per subscriber but with 50 million subscribers, it generates $7.5 million a month to the Pac-12's $5.4 million.
As much as the Pac-12 touts its 850 live events a year, that's not really the number that matters right now. How many people are watching and how much revenue is this broadcasting generating? Not enough, it's clear. Losing access to DirecTV's 21 million customers when it failed to make a deal originally with DirecTV continues to clobber the Pac-12 where it hurts to this day.
But is there a ray of hope? Actually, there is -- kind of. Maybe. If what no one knows how it will play out plays out in the Pac-12's favor. Here's how that could work.
While the SEC is tied to the same cable subscriber model as ESPN as a wholly-owned subsidiary, and like ESPN, has lost almost nine million subscribers in the last two years after starting with 70 million costing the SEC $70 million with cord-cutters pulling out, that's more than the Pac-12 generates in total. So the SEC has a long way to drop before it matters.
But if the Pac-12 has an opening, it's this. Since it hasn't partnered with either ESPN or Fox, which shares the Big Ten Network, it could be in position to take advantage of the over-the-top platforms like Sling TV, for example, analysts say. But the flip side of that is that if cable goes to an a la carte model, the less popular, less widely distributed Pac-12 won't be able to charge as much as the more popular networks.