After six years of deliberation and discussion, the ACC is close to an updated television deal with ESPN that will include the long-awaited ACC cable channel as well as innovative “over-the-top” components, content delivered directly to viewers via the Internet, known as OTT.
The announcement regarding a new ESPN deal could come as soon as the ACC’s football kickoff event in Charlotte on Thursday and Friday, where ACC commissioner John Swofford is scheduled to meet with the media Thursday morning.
The ACC’s current deal with ESPN runs through 2026-27 but has since been substantially eclipsed by the Big Ten and SEC. In May, Swofford said launching an ACC cable channel would likely be necessary to close that financial gap.
“That’s why ESPN is in the discussions with us,” Swofford said. “They like to make money, too. And we like to make money, as well.”
Some in the television industry have questioned the viability of another college sports network in the current television climate, but ACC administrators and coaches have pushed hard for a network for not only financial but competitive reasons. N.C. State months ago solicited proposals for a $2 million on-campus studio and production center designed for network programming. There have also been persistent rumors ESPN will owe the ACC a multimillion dollar lump-sum payment if it doesn’t launch an ACC network.
Any changes to the ACC’s television deal would come at a time of significant change for both cable television and college athletics. ESPN has been losing subscribers – an estimated 7 million in less than three years – as “cord-cutting” consumers move away from traditional cable and satellite bundles that feed ESPN billions of dollars in per-subscriber fees.
Yet rights fees for live sports continue to escalate because advertisers see sports as one of very few types of programming consumers watch live as opposed to via DVR – watching the commercials instead of fast-forwarding through them. (Reality TV is another.) Broadcasters, meanwhile, are doubling down on stronger properties while cutting back elsewhere.
You talk about the five power conferences, you have to be a power conference in every way.
Duke coach Mike Krzyzewski
The demand for that upper-tier programming spawned massive new television deals this year for the Big Ten (with Fox and ESPN) and the SEC (with ESPN) that left the ACC playing catch-up among the Power 5 conferences. Both conferences have their own cable channels that generate considerable revenue and offer additional exposure, particularly for non-revenue sports.
“You talk about the five power conferences; you have to be a power conference in every way,” Duke coach Mike Krzyzewski said Monday. “When you do those things off the court, off the field, you put your on-the-court, on-the-field teams in position to be competitive: recruiting, exposure. Does it need to be done? Absolutely.”
In 2010, when the ACC forged its current deal with ESPN, it chose to forgo a cable network in favor of a continued agreement with Raycom in what was branded as an “ACC Network” but was really a continuation of the conference’s decades-long syndication deal that puts ACC games on local affiliates like WRAL. Discussions over an ACC channel have been ongoing ever since, gathering pace after the 2012 addition of Notre Dame in all sports but football and the 2013 grant-of-rights agreement that essentially prevented any further defections after Maryland’s departure.
Conference-specific channels have proven a mixed blessing after an initial rush of enthusiasm. The Big Ten Network, a joint venture with Fox, has been an unqualified success; the revenue it generates, approximately $8 million per school per year, was a major factor in Maryland’s exodus from the ACC. ESPN’s SEC Network was basically an extension of ESPN’s existing SEC programming and would be the model for an ACC partnership.
Conversely, the Pac-12 Network has no established network partner and has struggled to find carriage (it’s still not available on DirecTV) as well as viewers, while Texas’ Longhorn Network, another ESPN partnership, has been such a non-factor that ESPN recently cut back on staff and programming.
A new deal would only strengthen the ties between the conference and broadcaster, which were already so tightly bonded that Syracuse’s new athletic director is a longtime ESPN executive, John Wildhack. The timing of his arrival is coincidental, but appropriate.
Luke DeCock: 919-829-8947, firstname.lastname@example.org, @LukeDeCock