In the great debate over the Longhorn Network, a possible Big 12 Network, and the future of the misfit conference that keeps wanting to tear apart at the seams, there's one important question that doesn't often come to the forefront. What happens if no one wants to purchase it?
With the current business model in a state of upheaval that could lead in a multitude of directions that make providers nervous, there's a growing sense that companies like ESPN and FOX could be reluctant to make big expenditures to bundle Big 12 third-tier rights together into a network, especially since the burden of finding a solution to the Longhorn Network conundrum will increase costs, even if ESPN takes on a hypothetical Big 12 Network.
In fact, one industry insider believes that it won't happen. Not for the Big 12 and presumably not for the ACC, either:
"I believe the days of conference networks have kind of come and gone for the most part," the insider said. "The SEC Network feels like the last one to me. No cable or satellite distributor wants to pay for another network, not in this environment."
So, yeah. That's just the opinion of one person in the industry, but it's instructive to take a look at the conference that most closely resembles the Big 12 at this time -- the ACC. The conference has been in negotiations with ESPN to start a conference network for at least three years with no success. And while the Syracuse athletic director recently said that he's not concerned about the impact of cord-cutting on negotiations, the industry insider interviewed by ESPN certainly has a much different opinion.
There's a difficult line to balance here for the ESPN -- Disney wants the company to cut costs, but live programming is the only thing that truly brings in viewers at a time when subscriptions are down year-over-year for the company to the tune of 3.2 million in lost subscribers.
Like the Big 12, the ACC is desperately chasing the Big Ten and the SEC in terms of revenue, but doesn't have the opportunity to increase revenue by adding a conference championship game -- it's ACC Network or bust for the league at this time. So if commissioner John Swofford can get any type of deal done with ESPN or FOX, there's a significant amount of pressure on him to do so.
For the Big 12, the industry insider wasn't optimistic:
"I feel that the Big 12 network is an uphill battle," the insider said. "Nobody in the industry wants to spend money right now in the satellite or cable distribution world. Nobody wants to dance in this climate. That is the biggest issue with a [Big 12] network."
In other words, even if Texas is willing to make significant concessions by giving up the Longhorn Network -- something that insiders believe is unlikely unless the Longhorns depart for another conference -- there are no guarantees that ESPN or FOX are ready and willing to ink a contract that would increase revenue to the level of the SEC Network or the Big Ten Network:
Yet for Texas -- not to mention Oklahoma, Kansas and West Virginia -- to recoup a palatable portion of tier 3 money, a Big 12 network would have to generate a collective payout in the ballpark of at least $80 million, provided the conference would share the revenue equally. That's a tall task, considering the Pac-12 delivered about only $17 million total through a network in its fourth year of existence.
Here's another way to look at it -- ESPN already has the Longhorn Network and FOX already has a productive relationship with Oklahoma that works well for both sides. So why would ESPN want to pay all that money to add Oklahoma and a bunch of programs that don't move the needle? And why would FOX want to deal with the issues related to the Longhorn Network just to add Texas and a bunch of programs that don't move the needle?
Neither scenario seems to make sense for either company.
Combine all those factors and the possibility of a Big 12 Network bailing out the conference and returning it to some semblance of stability and competitiveness with the two leaders in college sports looks rather slim.