For the Love of the Game, and the Money: Changing College Athletics through Conference Realignment
The Backyard Brawl
A mere 75-mile stretch of highway along I-79 separates West Virginia University from the University of Pittsburgh. Dating back to 1895 the two schools have met over 100 times, making the rivalry known as the Backyard Brawl between the schools from a coal town and the city of steel, respectively, one of the oldest and most intense rivalries in college football. But the rivalry is built on more than just country vs. city. With a relationship described as that of “kissing cousins,”1 the proximity leads to heated recruiting battles, and conference and national title hopes have often been dashed. Says WVU alumna Jean Ann McGuigan, “It’s so many things wrapped into one, but we just don’t like each other”2. Whenever it’s West Virginia’s turn to host the matchup, Mountaineer Field fills to capacity with 60,000 Mountaineer fans. That’s 60,000 people filling up the stadium in a town of merely 27,000 residents.3 In essence, the Backyard Brawl embodies everything that a great college rivalry should be. Proximity, a history going back for generations, titles at stake, and two rabid fan bases that despise one another all come together to create that special rivalry that can only be found in college sports.
Yet suddenly all this has been left behind. Recent shifts in the college landscape have pushed aside tradition, geography, and rivalry as schools have jumped from one conference to another. While Pitt, along with fellow Big East member Syracuse, leaves for the Atlantic Coast Conference, West Virginia has accepted an invitation to the Big 124, whose closest member is roughly 900 miles away. And while some are optimistic that the rivalry will continue, Pitt coach Todd Graham sounded unsure, saying, “It’s one of the great rivalries in college football. You would hope it would continue…[but] I have no idea what the future holds.”5
A Unique Culture of Sport
Although intercollegiate sports exist internationally, they have gained the largest popularity in the United States. The first intercollegiate sporting event occurred in 1852 when two boating teams from Yale and Harvard competed against each other. After this initial breakthrough in college athletics, there were a series of ‘firsts’ including the first football game between Rutgers University and Princeton in 1869. And so begins the evolution of college athletics to what it has become in the 21st century.6
College athletics began with modest intentions: to promote the idea of the scholar-athlete while teaching important character values such as perseverance, teamwork, and discipline. The Ivy League continues to hold onto this core model of amateur athletics and is seen as a good example of how intercollegiate sports should function.7 College athletics truly began to flourish when intercollegiate games developed from a purely participatory activity to a spectator event. American universities began to see opportunities to promote their academic appeal to prospective students through athletics. University leaders saw sports as a way to attract attention to their college in hopes of drawing more applicants. As time drew on, alumni and faculty formed strong ties to their universities through collegiate sports and thus spurred monetary donations. This marks the first major evolutionary step in college athletics.
The separation in popularity of collegiate sports between the United States and other countries can be derived from a number of different factors. First, in the U.S. universities are much more self-reliant when it comes to income, while universities in other countries are almost entirely government-funded. This encourages American universities to act more like a business by accepting different offers from television broadcasters or selling merchandise to earn an income. The media had a large hand in putting collegiate sports on the radar in the 1960’s and ‘70s. Many argue that television and other media sources have corrupted college athletics into what is seen in the 21st century. Second, outside the U.S. there are a number of countries that provide higher education free of cost or highly subsidized. This creates a gap because it opens the door for American colleges to gain an advantage by offering scholarships to high school athletes. Third, the United States does not develop athletes through their youth in the same way foreign countries do. The high school and college arenas are set up in place of this type of athletic maturation process, which explains the excess pressure put on college institutions to train athletes for the professional tier that lies ahead.
The lack of developmental leagues in the U.S. led to the creation of the image of the amateur athlete in college. As a student-athlete, they are not paid and are thus seen as being self-less players that play for the love of the game, as opposed to professionals who earn lofty salaries for their athletic abilities. The image of the amateur athlete makes college athletics in the U.S. completely unique in comparison to athletics of a similar level in other countries. It is something that often endears players to fans and is an image that the NCAA works tirelessly to maintain.
Finally, the most obvious reason for the division between the U.S. and foreign countries is the media attention generated. Other countries put little importance on ‘second tier’ athletics because they see no need in wasting their time watching sports that are sub par to professional games. The reason Americans find collegiate sports more appealing is largely due to the notion of amateurism and the strong affiliations felt for certain universities by the spectators, whether this is because of geographic location or ties to an alma mater. These serve as the driving force behind the popularity of college athletics in the United States.
ESPN
Background
The Entertainment and Sports Programming Network was launched on September 7, 1979 by father and son, Bill and Scott Rasmussen, as a twenty-four hour a day sports channel that would roam the nation covering sporting events.8 What started as a dubious concept has since turned into a network with eight domestic cable networks, over 50 business entities, and is now available through cable stations all over the world. Acquired by ABC (which is now a part of The Walt Disney Company) on April 30, 1984, ESPN has since become one of Disney’s most profitable operations, reaching over 100 million households in the U.S.9 10
Entering College Athletics
In preparing to launch ESPN, the Rasmussen’s understood that their start-up couldn’t yet afford major league sports TV rights. However, they saw college sports as a feasible way of obtaining significant and relevant programming that would attract viewers, and provide legitimacy and stature.11 On March 14, 1979 ESPN signed a two-year agreement for exclusive national cablecasting rights to a series of NCAA championships and regular-season events.12 This agreement began the era of collegiate sports broadcasting that has quickly grown into today’s multi-billion dollar industry.
ESPN’s Current Media Contracts Situation
Having been the first onto the college sports scene, ESPN has remained the most dominant player over the last three decades. College rights are now split into tiers for basketball, football, and other sports. First-tier are to be broadcast nationally, while second tier consists of football and basketball games not taken by the holder of the first-tier rights. Of the six major FBS conferences (the Big 12, Pac-12, ACC, SEC, Big Ten, and Big East), ESPN currently has contracts for first or second-tier rights with each of them. They currently hold a 12-year, all-inclusive contract with the ACC for rights to all sports and conference championships, as well as a 12-year partnered contract with Fox for all first and second-tier rights to the Pac-12. In the Big 12 and Big Ten they hold the first-tier rights for both through the 2015-16 academic year. While they do not hold first-tier rights in the SEC, they currently have the second-tier rights through 2023-24. Finally, their only contract expiring in the next five years is their contract for the Big East’s first-tier rights, which is set to expire at the end of the current 2011-12 academic year and has yet to be renewed. Finally, ESPN has begun a new contract solely with the University of Texas at Austin for the newly launched Longhorn Network. This grants them the rights to the new regional sports network that focuses on sports-related programming for UT and is valued at $300 million over the next 20 years.13
Conference Realignment
In December 2009, the most recent series of National Collegiate Athletic Association (NCAA) conference realignment plans were set off when the Big Ten announced its interest in considering the addition of one or more teams. The motives behind the addition of a twelfth team are generally seen as the potential financial windfall to be had from two sources. First, the conference’s Big Ten Network reportedly earns the conference 88 cents/month for every cable subscriber in Big Ten territory, so expanding the footprint has immediate gains. Second, reaching 12 teams meets NCAA requirements to hold a conference championship game in football, similar to the highly lucrative SEC championship game.14
Since then, each major conference has been impacted by schools having chosen to throw aside geography, rivalry, and history for the chance to increase their economic opportunities. The first wave of movements came in 2010, when Nebraska chose to join the Big 10.15 Meanwhile, the Pac-10 targeted six teams from the Big 1216 and ultimately brought in Colorado17, as well as Utah from the Mountain West Conference, to form the current Pac-12.
One year later, Texas A&M became dissatisfied with the Big 12 due to concerns regarding the conference’s stability and the university’s outrage over the possible unfair advantages in revenue and recruiting that Texas had gained with the creation of their new Longhorn Network with ESPN.18 This led to their jump to the SEC and Missouri, who reportedly stands to make upwards of $12 million more from renegotiated SEC broadcast rights than they currently make as a member of the Big 12, is expected to officially announce their decision to follow suit any day. 19
The next major moves came from the ACC with the additions of Pittsburgh and Syracuse, both from the Big East Conference.20 As a result of these additions, the ACC, which just this year began its new 12-year exclusive rights deal with ESPN worth $1.86 billion, has already begun talks to renegotiate the deal.21 Meanwhile, the Big East took more hits as Texas Christian University, which had previously committed to join in 2012, backed out of its commitment for an invitation to the Big 1222 while both Louisville and West Virginia have been courted as well and have both declared their desire to depart.23
ESPN Influences Conference Shifts
The recent realignment sheds light on a new set of issues for ESPN that are a result of its having contractual relations with each of the major conferences. In each of these contracts, a “good faith” provision is included that requires all parties to act in the best interests of their partners. Throughout realignment, the economic advantage of increased media rights revenue has served as a major factor in decisions, and ESPN is the entity providing this revenue stream. As a result, it becomes very difficult for ESPN to balance their fiduciary duties and act in the best interests of two opposing partners.
A&M and the SEC
In considering the motives behind Texas A&M’s departure from the Big 12, it is important to note that ESPN has a contract with both conferences. A&M is a lucrative member school to have when negotiating television contracts due to the 25 million viewers in its market. Seeing as the incentive for A&M to switch conferences is the prospect of increased media revenue, it follows that the SEC will renegotiate its contract with ESPN to this end. This creates ESPN’s current dilemma, they control the money and thus the incentive for schools to realign. And of course, one conference’s gain through the addition of an institution is an equal loss for the conference that they leave. As such, is ESPN breaching contract with the Big 12 by offering more money to the SEC and thereby inducing Texas A&M to leave?
It is also important to note that ESPN’s contract with the Big 12 is void if the conference falls below ten teams. Therefore, it’s in the best interest of the Big 12 to keep Texas A&M in terms of both their current television contract and future ones, in the case that they do fall below ten. Although they may not need to worry as much as it would seem. Looking back at the case with Colorado and Nebraska, despite the fact that both left the Big 12, payments from ESPN remained the same. In order to prevent possible issues with breach of contract and a possible law suit with the Big 12, ESPN decided against contract renegotiation. The same is the case with Texas A&M’s withdrawal from the Big 12. 24
The problem for ESPN then becomes how to serve their own best interest in light of their contractual dilemmas with the conferences. ESPN is now forced to pay conferences losing members the same amount as before in order to keep from being sued, while they also pay conferences gaining members more. As a result of their dominant position and involvement with conferences on both ends of realignment, ESPN has put themselves in a costly situation that requires careful consideration of the various interests at stake.
Additions to the ACC
In the case of the ACC’s recent expansion with the additions of Pitt and Syracuse, ESPN’s role was brought under public scrutiny following comments by Boston College’s athletic director Gene DeFilippo. While the additions were initially seen as merely a move to expand the conference’s footprint and become the premiere basketball conference, DeFilippo commented that, beyond consideration of television money, ESPN pushed the ACC to make the move:
We always keep our television partners close to us. You don’t get extra money for basketball. It’s 85 percent football money. TV - ESPN - is the one who told us what to do.25
While the moves are in the interest of the ACC, DeFilippo’s comments have given credence to the popular theory that ESPN has pushed for the downfall of the Big East.26 While the Big East’s first-tier rights are currently with ESPN, the contract expires at the end of the current 2011-12 academic year27 and, in May, the Big East turned down a new nine-year, $1.4 billion television contract from ESPN.28 This was largely because the Big East wanted to open up bidding to NBC and Fox as well. However, in orchestrating the defection of Pitt and Syracuse to the ACC, ESPN severely weakened the Big East’s negotiating power and shifted their largest TV markets and best basketball entities to the ACC.29 By greatly diminishing the value of the Big East, ESPN successfully prevents either NBC or Fox from being able to gain a strong foothold in the college sports market if the Big East signs their media rights to them. In effect, by influencing realignment to maintain a dominant position and marginalize any entry attempts by competitors, ESPN is actively taking actions that are to the detriment of one of their current partners.
The Future of College Athletics
It’s warfare…it’s market share warfare, that’s exactly what it is.30
While the changes in conference affiliations previously detailed have already taken place, the process has yet to stop. Currently, schools such as Louisville, Central Florida, Air Force and Boise State, among many others, have shown interest in realigning and have been in contact with potential new conferences. With the potential for schools like Air Force and Boise State going to the Big East and Louisville joining the Big 12, Dr. White was not exaggerating in stating that, “We’re throwing away all sense of geography, and rivalry and history and trying to monetize [college athletics]”.31
As realignment continues, all indications point to the eventual formation of super-conferences that will dominate college athletics. The most likely scenario, and the one that Dr. White anticipates, involves 64 institutions split among 4 conferences that will eventually separate from the NCAA. Currently, there are 120 institutions that are members of the Division I Football Bowl Series (FBS). While the formation of such conferences stands to greatly benefit the members, the four-conference scenario means a significant number of institutions will find themselves left out of what will then constitute major college athletics.
Furthermore, if those four conferences were to push aside the NCAA, all of Division II and Division III college athletics as it stands today would fall apart. This is because almost all of the NCAA’s revenue comes from a 14-year, $10.8 billion agreement for the rights to the NCAA Division I Men’s Basketball Championship.32 The NCAA spends over $90 million annually to fund 88 national championships in all three divisions.33 Without these funds and other support provided by the NCAA through distribution of their revenue, college athletics will not be able to support itself. Revisiting Dr. White’s views, this scenario leaves everyone outside of the super-conferences in, “a frightful position,” that would cause most institutions to become, “nothing more than glorified intramurals.”34 So while the formation of super-conferences will result in incredible monetary benefits for the institutions included, the outlook for those that fail to gain membership is very bleak.
Super Conference Issues
Tradition is something all the TV money in the world can't buy, but, sadly, tradition doesn't pay the bills.35
A four super conference structure seems almost inevitable in college athletics, and with this realignment there come many costs. The most apparent disapproval of this system is a loss of college rivalries. With teams being shuffled around to different conferences, there is great risk that big time rivalries won’t be placed in the same conference. Some say that this will not affect college athletics a great deal.
Yes, tradition means something, a lot to a great many alumni and fans. In-state rivalries are important, too, but they do not depend on two schools playing in the same conference. Florida-Florida State. Penn State-Pitt. Georgia-Georgia Tech. Iowa-Iowa State. Not to mention great non-conference intersectionals like Notre Dame-Michigan or Notre Dame-USC. For decades, Texas and Oklahoma maintained the blood feud of all time while playing in different conferences.36
Although these rivalries can continue through non-conference and bowl games, others believe the intensity will begin to diminish.
I'm not certain the inter-conference competition would remain. It would be diluted, at the least. With so much shifting, teams wouldn't have the same loyalty and belonging with respect to their conference.37
This brings up an entirely different issue: conference loyalty. Fans that feel affiliation to a specific university expand their loyalty to the conference as a whole. Therefore, in bowl or non-conference games that do not directly relate to the viewer, they are more likely to offer support to the team that belongs to their conference. With conferences becoming so much larger, this passion may fade quickly.
Impact on Student-Athletes
It is important to remember the fundamental reason behind universities’ endorsement of college athletics: betterment of the individual as a whole, not solely through academics. Recall, the purpose of a scholar-athlete is to reinforce positive character values such as sportsmanship, teamwork, leadership, and time management as a secondary priority to academic excellence. Collegiate sports is not designed to be entertainment for an audience, although some argue that this is what it has become.
The question of who benefits from the realignment into four super conferences is vital in evaluating whether or not college athletics has deviated from their original purpose. The answer is fairly simple--universities and television companies. But how are the student-athletes affected?
The general consensus seems to be that no one even considered how realignment would affect the students. In response to the changing environment, over 300 student-athletes from major college programs have signed a petition asking the NCAA to, “realize its mission to educate and protect us with integrity.” The petition supports protecting players’ scholarships in the case of injury, covering the cost of attendance, and fully covering the cost of sports-related injuries. Says Georgia Tech defensive end Denzel McCoy, “The things we go through, the hours we put in, what our bodies go through, we deserve some sort of [support]. College football is a billion dollar industry.”38
Super conferences are bound to force teams to travel thousands of miles unnecessarily to play against teams that are not even remotely close, but may very well be in the same conference. Not only will this excessive travel take away class and study time for student-athletes, but it will also impact their quality of life by adding additional hours spent on athletics to an already highly time-consuming commitment. NCAA President Mark Emmert shares his opinions:
I think what came across [with realignment] is that all we care about is money and what we can do that is to our advantage. Nobody was talking about what this is going to do for student-athletes or intercollegiate athletic programs. It was all about ‘let’s make a deal.’39
While the motives behind conference realignment can be questioned, the question that has not been asked enough is how this impacts those that collegiate athletics were meant to benefit. This is more than just business and it is more than just sport. Business practices and monetary motivation aside, the factors leading to conference realignment have also put the well being of the student-athlete at stake.
Study Questions
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Who are the stakeholders in the business relationships between ESPN and college conferences? In what ways have the interests of these stakeholders been helped and/or hurt as a result of realignment?
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Who does ESPN have a fiduciary responsibility to in their contractual partnerships? Is there any way for ESPN to act in the best interest of two partners when they are on opposing ends of realignment? Does ESPN’s involvement in influencing realignment raise any ethical issues?
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What about the business of college athletics today conflicts with the image of the student-athlete? How does realignment reflect this conflict? In what ways can the business aspect benefit student-athletes? In what ways can it hurt them?
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What groups, beyond the student-athlete, are impacted by realignment? How does it impact universities beyond athletics? How is it likely to impact the culture of college athletics that is so unique to the U.S.?
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Who is responsible for protecting the interests of the student-athlete? As a business entity, does ESPN have an obligation to consider the interests of the student-athlete, and why or why not? What should be the priorities of universities in handling the business aspects of college athletics?
Appendices
Exhibit 1
Timeline of Realignment Activity
Date Event
Dec. 2009 Big Ten commissioner Jim Delany announces conference’s
intent to add one or more teams
June 7, 2010 Pac-10 members authorize commissioner Larry Scott to
pursue expansion plans, issue invitations
June 10, 2010 University of Colorado joins Pac-10
June 11, 2010 University of Nebraska joins Big 10
June 15, 2010 Texas declares intent to remain in Big 12, ends speculation of
Texas, Texas Tech, Texas A&M, Oklahoma and Oklahoma State
all departing for Pac-10
June 17, 2010 University of Utah joins Pac-10
July 27, 2010 Pac-10 officially becomes the Pac-12 with the additions of Utah
and Colorado
Nov. 29, 2010 Texas Christian Univ. announces plans to join Big East in 2012
Aug. 26, 2011 The Longhorn Network is launched
Aug. 31, 2011 Texas A&M announces plans to join SEC in 2012
Sept. 18, 2011 Syracuse and Pitt announce plans to join ACC
Oct. 10, 2011 TCU backs out of commitment to Big East, announces plans to
join Big 12 in 2012 instead
Pending Moves Missouri to join the SEC
West Virginia to join the Big 12
Exhibit 2
Growth of ACC’s Market Due to Expansion
*Hypothetical
Exhibit 3
Current TV Contracts Rights
|
First-Tier Rights
|
Term of First-Tier Rights
|
Second-Tier Rights
|
Term of Second-Tier Rights
|
Total Per Year Average
|
Big 12
|
$480,000,000 (ESPN)
|
8 Years
|
$1,170,000,000 (Fox)
|
13 Years
|
$150,000,000
|
08/09-15/16
|
12/13-24/25
|
Pac-12
|
$3,000,000,000 (ESPN and Fox) for first and second-tier; 12 years (12/13-23/24)
|
$250,000,000
|
ACC
|
$1,860,000,000 (ESPN) for all-inclusive; 12 years (11/12-22/23)
|
|
$155,000,000
|
SEC
|
$825,000,000 (CBS)
|
15 Years
|
$2,250,000,000 (ESPN)
|
15 Years
|
$205,000,000
|
09/10-23/24
|
9/10-23/24
|
Big Ten
|
$1,000,000,000 (ESPN)
|
10 Years
|
$2,800,000,000 (BTN)
|
25 Years
|
$212,000,000
|
06/07-15/16
|
07/08-31/32
|
Big East
|
$200,000,000 (ESPN)
|
6 Years
|
$54,000,000 (CBS)
|
6 Years
|
$42,333,333
|
06/07-11/12
|
7/8-12/13
|
**Note: Texas also has a contract for the Longhorn Network with ESPN worth $300 million over the next 20 years.
Exhibit 4
Conference Mission Statements
ACC Mission Statement:
The Atlantic Coast Conference, through its member institutions, seeks to maximize the educational and athletic opportunities of its student-athletes, while enriching their quality of life. It strives to do so by affording individuals equitable opportunity to pursue academic excellence and compete at the highest level of intercollegiate athletics competition in a broad spectrum of sports and championships. The Conference will provide leadership in attaining these goals, by promoting diversity and mutual trust among its member institutions, in a spirit of fairness for all. It strongly adheres to the principles of integrity and sportsmanship, and supports the total development of the student-athlete and each member institution's athletics staff, with the intent of producing enlightened leadership for tomorrow.
Big 12 Mission Statement:
1.3.1 Mission. The mission of the Conference is to:
1.3.1.1 Advance standards of scholarship, sportsmanship and equity consistent with
the highest ideals of Conference membership.
1.3.1.2 Support the development of national-championship caliber intercollegiate
athletic programs.
1.3.1.3 Organize, promote and administer intercollegiate athletics among its
member institutions.
1.3.1.4 Optimize revenues and provide supporting services compatible with both
academic and competitive excellence.
1.3.1.5 Encourage collaboration in areas beyond athletics that builds good-will
between institutions and promotes the overall missions of the universities.
Exhibit 5
NCAA Student-Athlete Certification of Eligibility (Cover and pt. 1 and 3)
Exhibit 6
NCPA Petition Screenshot
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