The future media landscape for the power 5 conferences: Pac-12
The westernmost Power 5 conference, the Pac-12, complains about frequently getting neglected in the mainstream media as a result of the so-called East Coast bias. Even if this bias exists, it cannot be blamed for the poor performance of the Pac-12 Network.
Unlike the super successful SEC Network, the Pac-12’s signature station has struggled to gain an audience and generate revenue for its schools. Pac-12 commissioner Larry Scott has earned the lion’s share of the blame and rightfully so, as Scott mismanaged the creation of the network from the very beginning
Bad decisions dammed the Pac-12 network
In 2010, the Pac-12 set a new bar for media rights by securing a 12-year, $3 billion deal. Flush with cash, Scott decided to create a completely self-funded Pac-12 Network, hoping to create a long term cash cow for the conference.
Without outside funding, the Pac-12 took on the exorbitant startup cost alone, including the construction of a facility in San Francisco, far and away the most expensive city in the country.
The decision to self-fund and the location of the headquarters were in stark contrast to the paths of the very lucrative Big Ten and SEC Networks. The Big Ten’s limited its upfront cost by splitting ownership of the network with Fox and SEC built its headquarters in a much more affordable area, Charlotte, North Carolina.
The Pac-12 and its schools are currently paying for these mistakes, as SEC and Big Ten schools receive as much as ten times the revenue from their proprietary networks.
The SEC and the Big Ten are anomalies
Simply put, football is a bigger deal in the South and in the Midwest than the West. This is why the Big Ten Network has 60 million subscribers and the SEC Network has 63 million.
The rabid fan base in the South, coupled with the proximity of top student-athletes puts the SEC in an entirely different league than the rest of the Power 5 Conferences, except maybe the Big Ten. Yes, the SEC gets $1.40 per cable subscriber, but that’s because they have the best fans, the best players and they have won eight of the last 10 college football national championships.
While Big Ten country lacks the direct access to premier student-athletes, its powerful and passionate alumni power the conference’s network
The Pac-12 network suffers because of the popularity of the conference and the poor decisions of Commissioner Larry Scott. While the fan interest will never be able to rival that of the Big Ten or SEC, the Pac-12 can improve its bottom line with capital infusions.
By selling an equity stake in the network, the Pac-12 may be able to recoup some of its loses and use the new capital to strengthen its brand.