NCAA Rumors: ESPN’s SEC Channel Negotiations Nearing End
The SEC has been in negotiations with ESPN about launching their new channel, and it looks like things could be heading in to the final stages in preparation for the channel going live. There are three issues that had to be resolved before the SEC channel has its expected launch in August 2014.
First, The SEC has to obtain the local TV rights back from the schools to give the channel the content it needs. Right now, those rights belong to the schools’ rights holders — IMG College, Learfield Sports and CBS Collegiate Sports Properties — so the SEC is negotiating with those companies to retain the rights for the new channel.
In total, those local rights would give the SEC one football game per school and about six to eight basketball games for each school, as well as some of the non-revenue sports and their games, including baseball, softball and soccer.
Second, ESPN had to decide if they were going to partner with another media company on the SEC channel. A few months ago, Comcast, who was looking at possibly changing their Comcast Sports Southeast channel into an all-SEC network, had contacted ESPN about the possibility of partnering with them on the channel, but those talks stalled early on.
It would seem unlikely that ESPN would partner with another media company, because they already have the Charlotte-based ESPN Regional Television – that operates ESPNU – with the infrastructure, on-air talent and producers to plug in to the SEC channel from the jump.
Third, as part of the deal to run the channel, ESPN will have to take over almost all of the SEC’s marketing rights, which is probably the biggest stickler in the negotiations. Taking over those rights from the SEC would give ESPN the ability to combine its TV ad sales with the conference’s corporate sponsorships. That would add up to huge revenue jumps for ESPN.
Those marketing right are currently held by IMG College, who could negotiate to retain some of the power to sell corporate sponsorships, but it’s likely that all rights will end up with ESPN once negotiations are complete.
The SEC is looking at this channel as a potential unlimited flow of cash once they regain control over all of its live games, which will cost them some money up front. The additional national exposure of non-revenue sports, as well as additional pay-per-view revenue – which can be as much as $750,000 per game – are all big incentives for the conference.
ESPN sees this as not only a way to further corral viewership on college sports, but as a way to give them a sales advantage over other networks. Being able to package TV advertising on the SEC channel with corporate sponsorships is huge. The SEC’s list of major corporate sponsors includes Allstate, AT&T, Dr Pepper and Regions Bank, as well as second tier sponsors Aaron’s, Dick’s Sporting Goods, Golden Flake, and UPS – and that’s only naming a handful of them.
If these three issues can be resolved as quickly and some other loose ends are tied up, then the expected August 2014 launch date could possibly be moved up.
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