REPORT: Dollar figure finally emerges on significant ESPN deal Pac-12 rejected
Earlier this week, John Ourand of Sports Business Journal reported that in 2022, Pac-12 presidents rejected what was termed a significant offer from ESPN for Pac-12 media rights.
Let’s remember that the Big 12 arrived at a deal — sans Texas and Oklahoma (who will leave next year) — for $31.7 million per school. That was a remarkably good price point considering the two huge brands in the conference would no longer be part of the media landscape in the Big 12.
Apparently, the Pac-12 had a competitive media rights price point in 2022, but according to John Canzano, the conference’s presidents turned down an ESPN deal. That deal would have paid out $30 million to each member school per year.
The Pac-12 should have rushed to ESPN’s doors to agree to a $30 million price point, maybe bargaining to see if it could bump it up to 32 or 33, but being happy with 30. Given that USC and UCLA were no longer going to be in the conference, that would have represented a sand save after hitting the fairway drive into the bunker. It wouldn’t have been an amazing deal, but it would have been a competitive deal and given the conference stability.
Let’s process this huge story and what it means on multiple levels:
IT'S WORSE THAN YOU THINK
The Pac-12 had an offer from ESPN of $30 million per school in the fall of 2022. The network wanted it all. But the presidents and chancellors wanted more.
“We said we want $50 million per school.”
ESPN's response?
“Goodbye.”
Read: https://t.co/5FvvINZHQ2 pic.twitter.com/E8FS2oRiXe
— John Canzano (@johncanzanobft) August 11, 2023
USC VALUE IGNORED
USC leaving the Pac-12 obviously limited the ceiling on the Pac-12’s value. The hubris attached to wanting $50 million per year was not only unrealistic; it angered ESPN and can now be seen as a reason the network did not come to the Pac-12’s rescue in the final weeks and months before Colorado bolted for the Big 12 and began the chain reaction of departures that essentially destroyed the Pac-12.
The Pac-12 presidents did not understand USC’s value.
QUOTES
One quote from Canzano’s story comes from an unnamed Pac-12 inside source. This was a saga, the source said, of “How so many smart people can make such stupid decisions.”
KLIAVKOFF'S CENTRAL FAILURE
Canzano on Kliavkoff’s central failure in this process:
“The board instructed Kliavkoff to reject ESPN’s proposal and make a lopsided counter-offer. The commissioner should have pushed back and managed expectations in the room. He should have been more tuned into the eroding media landscape. Kliavkoff followed the order and the consequences were grave.
FOX SWEETENED THE POT FOR OREGON
Fox helped push Oregon to the Big Ten with a late infusion of money, per Canzano:
“Oregon officials informed Pac-12 leadership the Ducks wouldn’t leave the conference for less than a full share of the Big Ten’s deal. In the hours before the Pac-12’s fateful Friday meeting, the Big Ten added a sweetener.
“Oregon and Washington were informed they would receive a full share of the Big Ten’s subsequent TV negotiation (in 2030). When UO president John Karl Scholz announced Oregon’s departure on Friday afternoon, he didn’t talk about the six-year guarantee. Scholz instead noted that the annual distribution would “average” $50 million in revenue over a 10-year period.”
PAC-12 ALIENATED ESPN WITH ITS 2022 REJECTION OF THE $30M DEAL
One Pac-12 source told Canzano, “Fox obviously screwed us, and I would argue that after that initial ESPN offer in the fall that ESPN was no friend.”
PAC-12 CEO GROUP DIDN'T TRUST KLIAVKOFF IN THE END
One source told Canzano the Pac-12 CEO Group lost trust and faith in George Kliavkoff:
“I like George a lot as a person,” one person said, “but we were told things that didn’t come true time and time again.”
This is a weird statement, given a deal — a reasonable deal — was in place in 2022, and the presidents rejected it. Kliavkoff’s mistake, as noted earlier in this piece, was not in failing to get a deal in 2023. It was in failing to insist that the 2022 ESPN deal was good enough.
REMINDER No. 1
Reminder: The 2022 ESPN deal did not include San Diego State or SMU. Subsequently adding those schools and making some contractual provisions would have bumped up the Pac-12’s price point.
REMINDER No. 2
Pac-12 presidents rejected Larry Scott’s Pac-16 plan in 2011, a plan that would have included Texas and Oklahoma. Once again, while the Pac-12 commissioners bear plenty of blame for the conference’s demise, it is ultimately the Pac-12 CEO Group that killed the conference. It rejected deals that undeniably would have strengthened the conference.
