Big 12 Media Contract Extension: Security > Maximum $$$

The report that the Big 12 is about to extend its media rights contract with ESPN have been out for a while now. Sports Business Daily is now saying that the pending media rights extension will be patterned after the new Pac-12 media deal, which means that ESPN and Fox would share broadcasting and cable programming rights for the league.

That could have a positive effect for the Longhorn Network, and it certainly brings financial stability to a league that was on the verge of dissolving not that long ago. The current contract with ESPN runs through 2016, so why extend it this far out, and by doing so, could you be leaving money on the bargaining table?

Right now ESPN has the broadcast rights to the Big 12, while Fox has the cable rights for football through 2016. The current report says that the two media outlets will agree to swap games on occasion. The two have a similar agreement in place for the new $3 Billion agreement with the Pac-12.

This could work in favor of the Longhorn Network. Fox may want a Big 12 game for its broadcast network and would trade it for a game to be on one of the stable of ESPN cable channels, including the LHN.

The extension will be through 2025 and the money is good -- really good. The Big 12 will be getting $2.5 Billion over 13 years ($1.3 Billion from ESPN, $1.2 Billion from from Fox). That works out to over $19 Million a year for each of the 10 members of the league. That isn't the top of the financial mountain (both the Pac-12 and Big Ten pay their members $21 Million a year), but the view is pretty damn good from there. Unlike those two leagues, Big 12 members have control over their third tier rights, which include at least one football game a year and several basketball contests as well.

The Enemy of My Enemy is My Friend

The deal works for ESPN and Fox for a couple of reasons. They get the league for 2012 dollars. It is probably cheaper now because there is no bidding war, and there might have been one if the Big 12 waited.

When Comcast purchased NBC they made it clear that they are very interested in challenging both ESPN and Fox for sports programming, and they are interested in college football. They would love to have a BCS league to join Notre Dame on their network.

Both ESPN and Fox are invested in seeing that Comcast/NBC Universal doesn't get a foothold in live sports programming, and keeping the BCS leagues to themselves is a great way to block any new competitor.

So what is in it for the Big 12? Why not wait to renegotiate closer to the end of the contract? Why not at least get a permanent Commissioner? Chuck Neinas is serving as interim commissioner until later this summer. Moreover both the SEC and the ACC are expected to enter contract talks with ESPN in the near future and it is expected that they will see substantial increases, probably more than what the Big Ten or Pac-12 are getting.

One advantage for the Big 12 is that it solidifies the membership and stops the revolving door that has been whirling feverishly at the Big 12. The league brought in TCU and West Virginia to replace Texas A&M and Missouri, and this contract helps make it in the best interest of all ten members to keep the league stable. It also would seemingly make it in the best interest of the members to keep the league at 10 -- at least for a while -- to keep the per-team payment up.

Everybody gets a boost in media money, Texas has easier access to more than one football game for the LHN, and the networks can turn their attention to other leagues.