How The Supreme Court Made TV (and Cash) The God of College Football

Facebooktwittergoogle_plusredditmail

Forget what you think you know about the building blocks of college football. It’s not Yost or Camp or Stagg or Warner or Heisman or Rockne.

With Week Zero approaching to provide us with college football on every Saturday until January, bow down to your den’s big screen or your smart phone streaming app and worship at the god who has turned the sport into what we love.

Television.

Quick review. In the 1950s, as TV sets proliferated so did the desire to draw viewers and expand programming. The NCAA (always the villain, right?) was concerned that telecasts of games would diminish attendance and decided to limit telecasts. For over three decades, the NCAA controlled how many games could be on TV. Typically, the contracts with its television partner allowed for a Saturday doubleheader – a regional telecast and a national telecast.

In addition to controlling the number of telecasts, the NCAA doled out TV money in equal shares. That socialism reached a tipping point in 1981. No. 1 Southern Cal faced No. 2 Oklahoma. The game was televised on a regional basis. Those two schools received the same rights fee as did Appalachian State and Citadel, two schools that also had their game televised regionally.

That straw broke the camel’s back and led to Oklahoma and Georgia filing an antitrust suit against the NCAA in 1982. The Supreme Court ruled against the NCAA in 1984, stripping the organization of its control of football telecasts.

That allowed college football has become its own kingdom. The sport is run by the Power Five conferences. The spectacle of college games – emotion, upsets, cheerleaders, fans – led to networks paying Big Bucks for the realest of reality TV. As the money flowed and the telecast windows increased, conferences realigned to provide the best inventory to line the network shelves.

In terms of money making, it has become a growth industry. Big Ten schools are expected to earn $50 million each in revenue sharing. Despite uncertainty about its future because of significant membership issues caused by realignment, the Big 12 nevertheless went from $130 million in revenue distribution (to 12 schools) to $365 million (to 10 schools) over the last decade.

The Supreme Court ruling came five years after ESPN debuted. The deregulation of college football telecasts provided the first cable sports network with popular programming to replace slow-pitch softball and Australian Rules Football. For two decades, ESPN helped supplant and at times surpass the coverage and revenue from over-the-air networks.

But as we approach the 35-year anniversary of SCOTUS changing college football telecasts about three decades after college football telecasts debuted, it appears we’re reaching another seminal stage. The always widening revenue stream could be decreasing.

The approaching tipping point involves how televised sports is delivered. For today’s youth, cable is as foreign as rotary phones.

Cable made it possible for the Big Ten and the Southeastern conferences to establish their own networks. The Big Ten and SEC networks influenced both leagues to expand to 14, with the Big Ten adding Maryland and Rutgers and the SEC adding Missouri and Texas A&M. Those additions were designed to expand the geographic footprints and add potential cable customers for each league’s network.

BTN was the ground breaker in terms of a conference starting its own network. It’s a major factor in the Big Ten being No. 1 in revenue production, income that has increased every year. But the gravy train is headed toward a rickety bridge.

Cable cords are being cut by tens of thousands of subscribers. And those still tethered to cable and who aren’t sports fans are asking why they pay $100 a year for a network they don’t watch. (Your Veteran Scribe doesn’t watch dozens of the networks on his cable package but that’s a minor inconvenient considering those channels are nickel and dime charges.)

At Big Ten media days last month, BTN president Mark Silverman spoke to the media. His comments were upstaged by Urban Meyer’s clumsy tap dancing/lying about his dismissed wide receivers coach but Silverman pushed a verbal panic button.

“BTN is now facing our biggest challenge since the launch of the network,” he said. “Our 10-year agreement with Comcast expires at the end of August. A few months ago, BTN was removed from out-of-market cable systems on Comcast, which is the leading cable provider in the country. … It’s extremely concerning.”

The Pac-12 Conference lags well behind the SEC and Big Ten in overall revenue, and behind three of the other four leagues in per-member distribution. The main reason is that its Pac-12 Network has been facing distribution woes since its inception. The conference expanded by adding Colorado and Utah to help jump start its network, but Direct TV balked and never agreed to add it to its menu.

With distribution of content becoming a major issue, conferences’ cable deals could be replaced by streaming deals on (take your pick) Facebook, Amazon, Netflix. The demand for college football is expected to elicit lucrative contract offers and a bidding war between streaming services could mean another windfall. Or it couldn’t. College football fans aged 40 and older might balk at having to master a new technology that their sons and daughters conquer like flipping a switch.

In 1984, few college sports executives believed that deregulation would lead to billions of dollars in TV revenue. Perhaps what’s to come will be just as lucrative. But ask commissioners or top athletic directors about the future, their answer will be something along the lines of “Anyone who says they know how content will be distributed in 2025 is delusional.”

“When cable came out everybody said broadcast TV is dead, it’s going to go away,” Big 12 commissioner Bob Bowlsby said last month. “Well 126 million households have broadcast TV. When TV came out radio was supposedly dead. There are more radio listeners today than there have been at any time. So, the technology continues to change but if you have live content and compelling live content I think you’re always going to find a marketplace for purchase by platforms.”

That’s likely. However, stock market analysts live by the mantra that “past performance is no guarantee of future results.”

With the games starting this Saturday – and, understand this, Week Zero is a fabrication of networks wanting to fill an August programming void and off-the-radar schools wanting exposure – remember that television is the driving force and revenue source for college football.

And as the tectonic plates shifted dramatically in 1984, the coming of different distribution methods and the uncertainty of their revenue could soon change the landscape again.