Go nuts! Fans in Clemson celebrate as Tigers win national championship
In college athletics, revenue streams flow through HDMI cords. The Big Ten, Southeastern and Pacific 12 conferences have brokered billion-dollar media rights deals for linear television networks that pump millions back into their member schools.
However, for many years, the Atlantic Coast Conference’s media rights revenue trickled through Wi-Fi. The ACC held a longstanding deal with ESPN to broadcast games on its family of networks, but the league’s own network was confined to the web streaming.
That changed in July 2016, when ACC commissioner John Swofford announced a 20-year extension to its partnership with ESPN that included a linear network. Three years later, the ACC will finally be added to the channel guide.
The ACC Network will launch on Aug. 22 with studio programming. A week later, it will telecast its first football game, Clemson’s season opener against Georgia Tech. A four-part documentary series on Clemson football will follow through opening weekend.
Clemson has dominated its foes on the field, but it has trailed its peers at the bank. As the price of success continues to rise, with coaches’ salaries and facility construction, closing the revenue gap will help Clemson remain at the forefront of the industry.
The linear network is expected to increase conference payouts to all ACC schools. Yet, establishing a steady revenue stream like other leagues will require more than a click of the remote. The ACC must generate viable viewership before it can generate substantial revenue. It will require prudent programming, effective marketing and time.
“In the SEC and the Big Ten, the majority of the revenue differential is associated with the fact that they have mature television networks,” Clemson athletic director Dan Radakovich said. “We’re looking forward to the debut of the ACC Network and, over the course of the next two to three years, having that network mature and create additional revenues for us to help close that gap.”
The success of the ACC’s closest competitor supports Radakovich’s optimistic outlook. According to figures compiled by Forbes, the Southeastern Conference generated $205 million in television revenue during the 2013-14 academic year, approximately $35 million less than the ACC. The next year, after the launch of the SEC Network, SEC television revenue increased to $347 million.
“It’s certainly been meaningful to the conference as a whole,” said Charlie Hussey, SEC associate commissioner for network relations and COO. “Content, distribution and engagement, we’ve been successful in all three of those pillars. We tapped into the passion of the SEC and SEC fans right out of the gate, and we’ve been able to maintain that the last four years.”
Like the ACC, the SEC launched its network through a 20-year deal with ESPN. That extended the 15-year, $2.3 billion deal the SEC signed with ESPN in 2008. The Big Ten Network launched in 2007 with Fox and began a six-year, $2.6 billion deal with ESPN and Fox Sports in 2018.
Last year, the Big Ten distributed an average of more than $50 million to each of its member schools. The SEC distributed $43.7 million.
The ACC distribution last year to its schools? Just $29 million.
In South Carolina, it means that Clemson operated with $23.4 million less than in-state rival South Carolina in 2017. Approximately 66 percent of that discrepancy was in the reported revenues from media rights and licensing. Each year since 2015, the first year after the SEC Network launch, South Carolina has reported at least $41 million in rights and licensing revenue, a 30.2 percent increase from the reported figure in 2014.
Although Clemson’s pockets are not as deep as its peers, its bills stack just as high. In May, Clemson awarded Dabo Swinney a 10-year, $93 million contract, the largest contract ever offered to a college football coach. Clemson spends more than $100 million each year in salaries, scholarships, facilities and operations for all 19 sports, according to figures compiled by USA TODAY Sports.
Clemson relies on fundraising, investments and creative frugal strategies, like insurance policies to cover potential coaches’ bonuses, to mitigate its expenses. More television revenue will allay the accountants, but before they can get their hands on more TV money, ACC schools must get more eyes on the network.
Major television distributors DirecTV and Verizon Fios have agreed to carry it, as well as streaming services Hulu Live TV and Playstation Vue. Yet Dish Network and Spectrum have not reached a distribution agreement.