ACC Network contract 'look-ins' provide comfort to FSU's Thrasher
While it’s true that Florida State is essentially locked into the Atlantic Coast Conference for the next 20 years as a result of the recently signed Grant of Rights contract extension, FSU President John Thrasher is confident the Seminoles have little risk of being hurt by the long-term deal.
In an exclusive interview Wednesday with Warchant.com, Thrasher explained that the ACC’s new contract with ESPN calls for three separate “look-in” periods -- times when executives from both entities will be able to sit down and discuss whether the contract terms needs to be renegotiated. The first of those previously unreported “look-ins” will occur in 2021, just two years after the new ACC Network is scheduled to launch on cable and satellite television.
* Warchant Extra: Ira's observations and thoughts from the Thrasher interview
“So there are going to be three opportunities during the course of the contract to take a look at it,” Thrasher told Warchant.com. “To take a step back and see how it’s doing: Do there need to be adjustments? Things like that. ESPN agreed to that. The ACC agreed to it. So the first one will be in 2021. So we’ll have about 2½ years of experience, and we’ll see where we are.
“If we have to make some adjustments, we’ll make some adjustments.”
The ACC's previous television contract with ESPN, signed in 2012, provided "look-ins" in 2017 and 2022, but that deal was revised before they ever got to that point.
During a joint presentation by ESPN and the ACC during the conference’s annual media days in Charlotte, N.C., last month, no details were provided about potential revenues from the fledgling network. Media reports have speculated that when the linear channel launches in 2019, each ACC school could receive an additional $5 million to $8 million per year.
But that will depend largely on how many cable and satellite providers agree to carry the network and whether it gains distribution similar to the highly profitable networks operated by the Southeastern Conference and Big Ten.
Thrasher said ESPN executives met with the conference’s Council of President on several occasions before the deal was finalized last month, and he said they expressed confidence that the new network would receive widespread distribution.
“We have some ideas and projections (on the financials), and it’s going to be a positive impact,” Thrasher said. “It’s no secret -- our athletic budget’s over $100 million this year. We’re in an arms race, and we’re trying to keep up. …
“Even though we’re going to start off a bit slower than some people wanted, I think by the time we get to ’19 and ESPN starts leveraging its distribution networks -- because a bunch of those contracts are coming up -- I think it’s going to be a very positive thing for us. I really do. And it will give us a chance to do it the right way, as opposed to just jumping right in and maybe making mistakes.”
Thrasher said the ACC and ESPN already have calculated estimated revenues and shared those numbers with the member schools, but he acknowledged that it’s difficult to make precise projections in an ever-changing landscape.
Not only are cable providers losing subscribers by the tens of thousands due to cord-cutting (customers moving to streaming content), but the college football conference structure as we know it is subject to change -- whether by expansion of individual conferences or even realignment.
With that in mind, Thrasher said it’s difficult to make projections for the ACC Network five, 10 or 20 years down the road; the conference’s new contract runs through 2035-36.
“College football’s evolving,” Thrasher said. “You hear all of these ideas about super-conferences and all that. That could happen. But at least for the time being, we’re going to be well taken care of in the ACC. And I like the ACC personally. I’m a big fan of the ACC. I’m a fan of the schools that are in it. And I think it gives our student-athletes the best opportunity to compete at a very high level in all sports. Not just football.”
If the college football landscape does change, or if the new network has any issues with distribution, Thrasher said he takes comfort in having the “look-in” periods as part of the contract.
“I don’t want to speculate on that,” Thrasher said, when asked what type of recourse the ACC would have in those scenarios. “But (the college sports landscape) is changing. And it’s all driven by economics. It’s driven by economics and TV. And it could be some big changes … who knows? Look at the College Football Playoff. Nobody knew where that would be five years ago, and it seems to be working all right, even though they are working kinks out of it with the announcement about the dates of the playoff games. That’s an evolving thing.
“And people are talking about going from four teams to eight teams (in the future) … and when you do that, it does kind of focus on: Are the arrangements with the conferences right? Then you have to look at a lot of those kinds of things, too. But that’s beyond my pay grade.”
* Warchant Extra: Ira Schoffel's observations and thoughts from the Thrasher interview.
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