Pac-12’s gonna Pac-12, y’all.
We know Scott likes bold. He went bold trying to form the Pac-16. He went bold with the $3 billion Tier 1 deal with ESPN and Fox. He went bold with 100 percent ownership in the Pac-12 Networks.
Bold works when it’s the right bold, not when it’s the wrong bold.
The conference made a wrong turn with its business model for the networks: 100 percent ownership, 850 live events and six regional networks created supply that exceeded demand — and not nearly enough viewership or revenue.
Which is why the conference is seeking a cash infusion in the first place.
A Hotline source told me recently that athletic department officials are concerned campus executives will view the cash provided by an equity partner — perhaps as much as $60 million per school — as a chance to eliminate debt.
That those responsible for balancing the books will hijack the process, leaving the athletic departments with nothing left for long-haul resource investment.
They would be right back where they are now, except with an outside entity sharing in their media revenue.
(Over the course of decades, the money lost by splitting the pie 13 ways instead of 12 would quickly erase the initial windfall.)
“It can’t be about helping our budgets,’’ the source said. “It has to be about helping us compete.”
If debt elimination is the end-game … if that’s the other end of this wormhole … the conference will be much worse off than it is now.
But the schools’ books will be sounder. And isn’t it their money and their choice on how to spend it?
I’m not trying to argue who’s right and who’s wrong here. It’s clear, though, that this is a bunch that’s never been on the same page with the guy they brought in to be bold. That’s how you get to a point like this. Given their track record, what are the odds that whatever choice they eventually make works?
3 responses to “One man’s bold is another’s financial opportunity.”
Hmmm. Lots of debt, an opportunity (wise or not) for new revenue, how to spend it? Let’s spend it on shiny new stuff that will put us deeper in debt, and will likely cost more than we projected, while the incoming revenue turns out to be less than the rosy projections predicted! What could possibly go wrong? Is AOC the new Pac 12 commissioner?
I am so here for VC bros loading PAC12 schools with debt and then selling off all their football assets for pennies on the dollar.
Okay, I pick on the PAC-12 as much as anyone, but this is starting to get sad. As a CFB fan, I’d like to see a decent football environment out there, but maybe it’s time has passed.
They need to fire Larry Scott and dig out of this mess ASAP.
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