The Big10. The Big12. The PAC10. The ACC. These collegiate athletic conferences are in a massive race. The news most recently is centered around the demise of the PAC10 and schools like Colorado heading to The Big12 and Oregon and Washington heading to The Big10. The geographic boundaries are non-existent at this point and schools are seeking the biggest stage for their athletic programs. Why is the stage so important to these athletic departments? The answer lies in the MONEY, but it is not that straightforward.
The conferences supply the stage that schools compete on giving them the brand awareness and exposure. These stages come with national prominence, prestige, and status - as well as a significant payday. This payday is not a check written by the czar of collegiate athletics. It is the culmination of the value of the properties in the conference that ultimately delivers a media rights deal.
A media rights deal is an agreement related to broadcasting, underpinning the relationship between sport and television and other media. Television and media organizations pay huge sums of money for the exclusive license which delivers the rights to broadcast top sporting events live.
As the world of television expands massively from terrestrial to cable to streaming, the competition is fierce for media dollars. In order to create the most valuable property and drive the largest media deal, conferences are competing to bring the biggest, most notable and valuable schools to their conference.
As the conference media rights deals increase, the schools fixed payments from those deals rise. These fixed payments to each member school will provide a solid financial base for the schools and the athletic departments to manage their large annual operating budgets. The Media Rights deals are the life blood to major college sports and many other sports leagues around the world.
Media deals are not restricted to collegiate sports. The Olympics, the World Cup, the NBA, the NFL, the Premier League and the MLS are just a few deals in the news recently. Media and Broadcast Rights is a major topic that can provide great insight into the economic principles that drive Sports Business.
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