August 25, 2008

ESPN, SEC ink 15-year, $2.25B broadcast deal

In a follow up to the recently announced SEC/CBS television deal, ESPN has purchased the remainder of the SEC broadcast rights for $2.25 billion over the next 15 years.

ESPN will pay the Southeastern Conference a staggering $2.25 billion over the next 15 years — about $150 million a year — for the conference’s TV rights, giving the network all of the SEC’s content that was not taken by CBS, industry sources confirm.

The deal effectively ends any conversation of a conference network, and it knocks Raycom Sports (formerly Lincoln Financial and Jefferson Pilot) out of the SEC’s distribution business for the first time since 1986, when JP Sports began distributing SEC basketball.

The deal is interesting, because it essentially makes ESPN the default provider for the majority of the SEC's televised games... if it so chooses. And that's an important distinction.

While ESPN has plenty of schedules to fill at ESPN, ESPN2, ESPNU, ESPN the Ocho, etc... there is no obligation for ESPN to actually televise the games it has purchased. As speculated earlier this week, ESPN may have pulled a pre-emptive strike in purchasing the broadcast rights and could potentially sell some games to Raycom, Fox Sports, or another provider.

The deal also gives ESPN exceptional leverage in getting its daughter networks (ESPNU, etc) placed on more cable packages. There are rumors that a Comcast deal will be announced this soon regarding ESPNU.

The total combined payout from the CBS/ESPN deal represents a nearly three-fold increase in broadcast revenues - $205 million per year versus the $70 million that the SEC just realized in 2007. The new revenues essentially guarantee each SEC school a minimum of $15 million per year, which means that even Vandy will be making close to "Notre Dame money" for the next 15 years.

HT: Georgia Sports Blog

Posted by Kevin Donahue

Comments:

ESPN, SEC ink 15-year, $2.25B broadcast deal
In a follow up to the recently announced SEC/CBS television deal, ESPN has purchased the remainder of the SEC broadcast rights for $2.25 billion over the next 15 years.
ESPN will pay the Southeastern Conference a staggering $2.25 billion over the next 15 years — about $150 million a year — for the conference’s TV rights, giving the network all of the SEC’s content that was not taken by CBS, industry sources confirm. The deal effectively ends any conversation of a conference network, and it knocks Raycom Sports (formerly Lincoln Financial and Jefferson Pilot) out of the SEC’s distribution business for the first time since 1986, when JP Sports began distributing SEC basketball.
The deal is interesting, because it essentially makes ESPN the default provider for the majority of the SEC's televised games... if it so chooses. And that's an important distinction. While ESPN has plenty of schedules to fill at ESPN, ESPN2, ESPNU, ESPN the Ocho, etc... there is no obligation for ESPN to actually televise the games it has purchased. As speculated earlier this week, ESPN may have pulled a pre-emptive strike in purchasing the broadcast rights and could potentially sell some games to Raycom, Fox Sports, or another provider. The deal also gives ESPN exceptional leverage in getting its daughter networks (ESPNU, etc) placed on more cable packages. There are rumors that a Comcast deal will be announced this soon regarding ESPNU. The total combined payout from the CBS/ESPN deal represents a nearly three-fold increase in broadcast revenues - $205 million per year versus the $70 million that the SEC just realized in 2007. The new revenues essentially guarantee each SEC school a minimum of $15 million per year, which means that even Vandy will be making close to "Notre Dame money" for the next 15 years. HT: Georgia Sports Blog