www.sportsbusinessjournal.com
SBJ Unpacks: EXCLUSIVE: Apple back in on Big Ten talks
June 30, 2022
Tonight in Unpacks: EXCLUSIVE: Apple reaches back out to Big Ten on media rights after news of USC and UCLA coming aboard. SBJ's John Ourand and Michael Smith break it down.
USC, UCLA will bring more media money to the Big Ten
Soon after the news about USC and UCLA joining the Big Ten broke, an Apple exec called the conference with a simple message: It wanted to reengage in media-rights talks, report SBJ's John Ourand and Michael Smith. That call was emblematic of a chaotic day where media companies that had spent months finalizing how much they would pay for Big Ten rights were rushing back to the drawing board to see how the addition of two high-profile schools would change their bidding strategy.
It seems certain that negotiations now will extend into August and may be completed after Labor Day. Originally, the Big Ten had been planning to wrap up its rights negotiations at some point in July. The Big Ten was expected to be the first college conference to eclipse $1 billion in media-rights fees annually -- and that was before USC and UCLA said they would join. The Big Ten presidents officially voted to add the two schools tonight.
Fox Sports already had reached a deal to carry at least half of the conference’s package, and CBS was viewed as a front-runner to take at least a package of Saturday football games in the 3:30pm ET window. That left Amazon, ESPN and NBC competing for a third package. As late as this morning, Apple and Warner Bros. Discovery were not viewed as credible bidders. That could all change.
Media valuations are based on the addition of two more schools’ worth of games, plus a noticeable improvement in the quality of games on offer, which will make the second and third choices of games more attractive to networks each week.
The move also makes the Big Ten more valuable to media companies by devaluing a Plan B for the companies that don’t get Big Ten rights. Yesterday, media companies left out of the Big Ten would have turned their focus to the Pac-12. But the defections of USC and UCLA have caused media companies to question the value of focusing on the Pac-12.
Today’s blockbuster news culminated a whirlwind of back-and-forth discussions over the last five days. The Big Ten had been in serious talks with the leadership at both universities for more than two months, but the discussions turned more urgent over the past weekend. The schools reached out in tandem to Big Ten Commissioner Kevin Warren on Sunday to accelerate the process, saying that they wanted to apply for membership immediately. That led up to today’s bombshell that the Trojans and Bruins would be joining the Big Ten in 2024.
When the news broke earlier today, the Pac-12 and commissioner George Kliavkoff were completely blindsided, sources say. USC and UCLA formally submitted their applications for membership on Monday. Warren took them to an emergency meeting of Big Ten presidents and chancellors on Wednesday night and found them receptive. The formal vote occurred a short time ago.
The addition of USC and UCLA marks a huge win for the Big Ten's Warren, and further separates the Big Ten and SEC -- the two richest leagues in the land -- from the ACC, Big 12 and Pac-12. It also calls into question the future of football independent Notre Dame and access to the College Football Playoff. The moves today also created a new narrative around “What’s next?”
While the Big Ten contemplates its next move, schools from other conferences already have begun reaching out about membership opportunities, sources say.