Time Warner Cable, already a corporate sponsor with UT Athletics, apparently is willing to give the new UT channel wide distribution in return for as much as a 20% ownership stake in the network.
TWC is the major cable distributor in the state, with over 2 million customers. There are almost 8 million cable and satellite households in the state.
Other details in the ESPN/UT deal include:
* ESPN has promised to to produce programming for the Texas channel that is comparable in quality to ESPN’s national networks. ESPN is in charge of staffing the network, and will have offices in Austin and the Bristol, Conn., headquarters to oversee the channel.
* As expected the digital rights to UT content is a key component for ESPN. There will be a website that will represent the network and carry part of its programming not carried on the network. Currently some of UT’s live events are being streamed on the official site (especially baseball). According to this new agreement the school’s official site cannot show more than two minutes of an event that’s live on the channel or the channel’s website.
* IMG College will be responsible for the marketing of the network. There will be packages that include not only ads but individual sponsorship opportunities for shows or special features within shows. Again the whole "bundle' concept where advertisers can work deals throughout the network will be featured.
* Texas multi-media rights contract with IMG College is based on revenue sharing, rather than the normal collegiate contract which pay a guarantee and then a 50-50 split of revenue once it hits certain thresholds. Texas negotiated the deal so once annual revenue hits the highest threshold spelled out in the contract — $15 million or more — the split is 82.5 percent for Texas to 17.5 percent for IMG.
* Burke Magnus, Senior VP for Collegiate Programming for ESPN is confident this is a good deal for everyone involved. "It's impossible to know how long it will be before the channel is profitable, but we wouldn’t be doing this unless we thought it was a good business proposition."
This new channel once again shows how DeLoss Dodds has done an exceptional job in keeping Texas in the forefront of the multi-media marketing of collegiate athletics, while also minimizing the risk exposure to the University. This is shaping up as another Win-Win scenario for the University of Texas.