Quote:
Originally Posted by Arles
OK, just so I understand, Texas is going to pass on a plan by Larry Scott that will get them roughly $25-27 million starting in year 1 with the Pac-16, top dog status in football for the Pac (given USC's issues) and association with much better research/academic institution (primarily the Cali Schools) for a package of:
1. $14-17 mil annually.
2. A one time payment of $2 million from Colorado/Nebraska leaving
3. the ability to start their own network - which could net them $3-4 million 3 years down the road.
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I highlighted year 1 because that's the significant issue year -- Texas wouldn't get $25-27 million in year one. First, the Pac 10's current deal with Fox runs through 2012, so you're not talking about getting money under a new deal until the 2012-2013 school year. Secondly, the Pac 10 network doesn't exist. It would take at least a year before the network could debut, and more likely wouldn't debut until 2012 when the Fox deal ends. Thirdly, any network requires startup costs and it's unlikely a Pac 10 network would be profitable for at least 3 years, maybe more.
So you're really talking about getting those revenues in year four or five, if those numbers hold up. The Pac 10 is basing its assumptions it can get $200-$250 million per year from a network AND start it's own network. That combination is unlikely.
From a financial standpoint, moving to the Pac 10 wouldn't pay dividends for 3-4 years. So why not stand pat, let the other Pac 10 schools deal with getting the network launched and see where you're at then?
Plus, don't forget to subtract the $16 million or so Texas would owe to the Big 12 in penalties for bailing on the league.