SBJ Morning Buzzcast

SBJ Morning Buzzcast: August 8, 2023

Episode Summary

Are college presidents a help or a hindrance? The Pac 12's media options; Could MLS land another global star?

Episode Transcription

This is your Morning Buzzcast for Tuesday, August 8th. Good morning. I'm Abe Madkour. Thanks for listening to the Buzzcast. One element of all the movement from the world of college sports that makes me shake my head, and that is the role and the actions of college presidents. I'm sorry. I just find it fascinating that these leaders, who know very, very little about the business of sports, are the ones making the key sports business decisions about their institution. I know very few people who are involved in the world of intercollegiate athletics who find the input of today's college presidents to be valuable. I know that sounds harsh, but it's just what I'm hearing. And sometimes you hear some of the presidents speak and comments on the issues of the day, and it does make you wonder about if they are the best people to be making the decisions around sports business issues.

Anyway, I found it interesting the perspective of Washington State President Kirk Schulz, who, to be fair, has been very active in college sports and college sports issues throughout his career. He said he thought that the deal that the PAC-12 received from Apple was innovative and forward-thinking, and he believed it had great upside. Arizona President Robert Robbins said the PAC-12's offer from Apple was for $23 million per school with no games on linear television. And he admitted those issues were problematic, and they didn't like being with a partner that was based around subscriptions. The president's found had great concern about being tied to a subscription-based product. Now, everyone I have spoken with acknowledged that the Apple deal had incentives based on projected subscribers to a PAC-12 streaming product that would result or could result in the conference dramatically increasing its annual revenue, getting it to an estimated $40 million a year, if not more.

The PAC 12 also had a well-reported opt-out clause after a couple of years if the deal didn't reach a specific revenue target. But all that being said, in the end, and this is no fault to the presidents, they just were averse to this type of risk. They didn't like the risk of going with Apple. They wanted more financial certainty. They wanted linear distribution and linear coverage. And at the end of the day, that drove the decision of most of these institutional leaders. Now, some asked me yesterday, "Where were the traditional media players?" Well, SBJ's John Ourand reported Monday night that ESPN, Fox, and CBS all put in last-minute bids for packages of PAC-12 games. But these bids were only for a few games, and they all came in way lower than the conference wanted. In fact, they were so low that PAC-12 Commissioner George Kliavkoff only presented the presidents with Apple TV's bid last week.

Not any of the bids from the traditional media players, and what shouldn't be overlooked is the difference in the marketplace in just a year. Last year, the Big 12 did a deal. There was a time last year where ESPN, Fox, and CBS were each willing to do a deal with the PAC-12, but that all changed, and that led to much smaller bids that limited the PAC-12's options, a changing media landscape with shrinking subscriber numbers. And there's employee layoffs that caused each of the networks to be much more disciplined in where to spend their money than they have in the past. And all of that hurt the PAC-12. So what's left? Let's review some other pieces in play here. First, the California Board of Regents will meet today, Tuesday, to discuss Cal's PAC-12 membership. Meanwhile, George Kliavkoff told the San Jose Mercury-News that he has no plans to resign.

He said he is loyal, and the conference still has a lot of work to do, and that he is committed to that work. Here's what else you need to know for today. The ACC might not remain on the sidelines much longer, as ESPN is reporting that there are talks scheduled immediately for the ACC to discuss the potential addition of Cal and Stanford. I was with a sports business executive last night, and they believe that Stanford, despite the geographic distance, would be a great fit, specifically in the ACC. Meanwhile, there's been a lot of talk about Florida State possibly leaving the ACC, and there is an August 15th deadline for any member of the ACC to give notice if it plans to leave the conference in a year. Now, Florida State has been, let's just be kind, unpredictable during this whole entire process. They are a certain wild card you need to keep an eye on.

Last week, you heard UNC Athletic Director Bubba Cunningham pretty much chastise the school and its leaders for talking so publicly about potentially leaving the conference. Now, Florida State has a very vocal athletic director and Michael Alford. They have a very, I would say, aggressive president. They have both been vocal publicly and in meetings that the school is not happy with how the conference is addressing its revenue gap compared to, say, the Big Ten and the SEC. So the bottom line is Florida State is getting frustrated and certainly making a lot of noise about its future. But where would they go if they decide to leave? They're likely not going to land at the SEC, which is not looking to expand, and the Big Ten certainly seems set for now.

So Florida state's options to me, from this vantage point, seem to be limited. Wow. So there is a lot going on, but let's look at some non-college sports stories. I met with a top executive with very close ties to Major League Soccer last week, and they told me something interesting. They said there was great Messi envy among a number of MLS owners, who are very eager to land their own top player and elevate the exposure and business prospects of their teams. Owners are already seeing what Messi is doing in Miami, and they want to play in that game. Now, my retort was that there's only one Messi and is the pool of players that deep, but they countered that there are a number of top players around the world that owners in MLS are eager to try and land. While now comes a very interesting report broke yesterday that MLS has explored the possibility of landing Mbappé and bringing Mbappé to the United States confident after landing Messi. MLS is looking to come up with a wide-ranging deal structure that would be attractive to the player.

Now, Commissioner Don Garber acknowledged so much by saying that MLS is ambitious and will come up with various kinds of structures to attract top players. So this is very early, and one would have to say it's probably a long shot to land Mbappé, but there are certainly a lot of energy and interest among MLS and owners to ramp up talent in the game. And that has been seen for a long time as the league's biggest shortcoming, not getting the best players in the world to play in MLS. I love a little saber rattling, and there was an interesting story in yesterday's SBJ Daily where BIG3 founder Ice Cube claims his league is making great progress, but it's getting ignored by mainstream media and corporate sponsors.

Now, Ice Cube probably didn't make any friends at the NBA's League office or with Commissioner Adam Silver, as Ice Cube believes the NBA views the BIG3 as a rival and claims that it has encouraged sponsors and networks such as ESPN to dismiss the league. He said it's nearly impossible to find BIG3 highlights or scores on television. And he said that the league's lack of media coverage and sponsorship is its biggest obstacle, and he added that he believes the NBA is telling its business partners to not pay attention to the BIG3. Pretty strong words, pretty fun gamesmanship. I have not paid a ton of attention to the BIG3. I went to a game a couple of years ago pre-COVID, but I was surprised to hear that the BIG3 just spent a successful weekend in Boston, where they drew a season-high more than 11,000 fans to the TD Garden. Last week, they were in my hometown of Charlotte. I haven't heard how they performed here, but Ice Cube obviously feeling that there's some pressure being put on major media companies and corporate sponsors to ignore the BIG3.

And we'll end with a name in the news back to college sports. Utah State University has named Diana Sabau as its athletic director after a national search. Diana Sabau will start at Utah State on August 21st. She is a well-respected leader. She's had a long tenure in college sports, more than three decades. Most recently, she served as deputy commissioner and chief sports officer for the Big Ten Conference. Prior to joining the Big Ten, she was part of Gene Smith's executive leadership team at Ohio State, where she learned under Gene Smith. Gene Smith is incredibly fond of Diana Sabau, and she had a lot of roles at that big institution for a number of years before going to the Big Ten. Now she starts at Utah State University as his athletic director on August 21st. Diana Sabau was also an SBJ game changer in 2022.

And that is your Morning Buzzcast for Tuesday, August 8th. I'm Abe Madkour. Thanks for listening. Stay healthy, be good to each other. I'll speak to you tomorrow.