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Figuring Out The Fine Print In Conference Expansion

Speed kills in college football. If you are not getting ahead, you are falling behind. That goes for on the field as much as it does off the field.

From recruiting to facilities, from uniforms to campus life, each school is in a never-ending race to the top to get more – more wins, more championships, more recruits, more prestige.

More money.

The financial aspect of college football has been at the forefront early this season as Texas A&M began the musical chairs of expansion talks. Their threat and eventual secession to the SEC from the Big 12 got every major conference thinking expansion. In the end, only the ACC took the bait in accepting bids from Syracuse and Pittsburgh to move to 14 teams in 2012.

Still, the idea has been planted and will hang as a specter.

The More Things Change…

Really, though, nothing has changed. As much as schools and fans preach the “tradition” and “pageantry” of college football, each team’s true colors are green.

Switching conferences has been a time-honored tradition in college football long before scandals and Texas bias caused the Southwest Conference to break up in the early 1990s. That is when Arkansas left for the SEC and those allegedly greener pastures.

Texas A&M has seemingly been waiting for the final straw to leave, resting on their own self-esteem and pride to keep them tied to the conference with their rivals in Texas. The Longhorn Network seemed to be it for Texas A&M as the uneven split of TV money in the Big 12 no longer made the conference worth it. Neither did Texas raking in $300 million over the next 20 years for the Longhorn Network.

The SEC had greener pastures with an even split of television revenue and a 15-year, $3 billion TV rights deal with ESPN and CBS signed in 2008. Some of the other Big 12 teams saw the Pac-12 as greener pastures after ambitious commissioner Larry Scott secured a 12-year deal with ESPN and FOX worth about $250 million per year, according to Sports Business Journal.

When you consider that the Pac-12 now has the largest TV deal in college football and that the SEC has an option to look into its 15-year deal after five years, adding a potential market in Texas could put the SEC in a better position to get even more and pull ahead of the Pac-12 in TV money.

Not that the product on the field does not help the SEC much. This is a race to the top and a race to get more and more and more.

The question throughout this whole expansion saga (one that will not end but will just go dormant for a while) is how much more money the actual teams could get.

Splitting the Pie

The way most conferences work, teams split bowl and television revenue money evenly among the member schools. That is one of the benefits of being in a conference. When one member school gets the bonus from winning a national championship or a bowl game, the whole conference benefits. The larger the TV deal, the more that gets shared with the other members of the conference.

That is the theory at least.

Logically, then, it makes sense to say that the larger the conference, the less that gets split among the members. That would make it actually a bad thing to expand because less money would be able to be spread around.

Of course, certain opportunities cannot be passed up.

That had to be what the Big Ten was thinking when it set off the latest round of expansions by adding Nebraska. With the Big Ten Network raking in cash for the 11 member schools and providing great national exposure by showing every single home game the Big Ten had to offer, it seemed there was not much the Big Ten could gain from expanding.

It made sense though for the Big Ten to expand. BTN was continuing to grow and improve – becoming much more of a cash cow than it was initially. And by moving from 11 to 12 members, the Big Ten gained the highly profitable championship game (to be played this year in Indianapolis).

Much more expansion just does not seem to make much sense unless ESPN is willing to give the Big Ten a retooled TV agreement or unless Notre Dame would be willing to share its spoils with the other conference members.

This has to be the thinking for the Pac-12 too after it inked its record TV deal and secured 12 teams in Colorado and Utah to get a championship game.

The game of musical chairs is all about how much money the schools and conferences can make. It is all about being the most attractive for the major networks – ESPN being the main culprit (and the network is reportedly trying to use its influence to do more than tell the news). When a conference expands, many of these TV deals allow the conference to renegotiate their deals.

This is a powerful tool to ensure that each school keeps at least the same amount of the pie they were collecting before expansion. It is very uncertain what kind of money the expanded SEC or the expanded Pac-12 will make in the near future. And it is quite uncertain whether Vanderbilt will still rake in the money it had been before Texas A&M joins.

Addition by Subtraction?

Right now, the Big 12 might be the conference that benefits most. While the conference may not have a long-term future, Clay Travis of Out-Kick The Coverage predicts the teams remaining in the Big 12 might get a short-term windfall as FOX and ESPN cannot get out of their current TV deals.

“The leftovers in the Big 12, those without many options, might stand to reap a whirlwind for the next decade or more as remaining members of the Big 12,” Travis wrote in early September. “That is, Baylor, Iowa State, Kansas, Kansas State, and Missouri – the five schools that aren’t presently leaving or rumored to be leaving, yet – have a strong legal argument that ESPN and FOX will breach the Big 12 contract if those networks provide the inducement to others schools, Texas A&M, Texas, Texas Tech, Oklahoma and Oklahoma State to leave those conferences.

“That’s why this is a fact you can take to the bank: ESPN and FOX aren’t going to reduce the amount they are paying the Big 12 for television rights even if the remaining Big 12 is a shell of its current state.”

Now that we know Oklahoma is not going anywhere, for the time being, the Big 12 is not quite the shell it used to be. And if this hypothesis is true, the Big 12 could still stand to make a major move in reforming its conference – such as going after the Big East’s TCU, Louisville or USF or going after other schools like Boise State, UCF or Air Force to name a few. The Big 12 might actually have some options if it can piece itself together and begin to trust itself once again.

These TV deals get pretty complicated and a lot of money is owed to these schools for the foreseeable future. Whether these schools can keep their stakes and interests in these TV deals while actually expanding their income and revenue remains to be seen as the market plays itself out.

When the Pac-12 put the brakes on its consideration for expansion and turned down any overture that Oklahoma may or may not have made, everything else slowed down with it.

But it will only be a matter of time before these conferences and teams begin to re-evaluate things and the expansion round robin begins again.

This is Philip’s first piece for Crystal Ball Run. Follow him on Twitter @RiseNU

About Aaron Torres

Aaron Torres works for Fox Sports, and was previously a best-selling author of the book 'The Unlikeliest Champion.' He currently uses Aaron Torres Sports to occasionally weigh-in on the biggest stories from around sports. He has previously done work for such outlets as Sports Illustrated, SB Nation and Slam Magazine.

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