West Coast Post: Inside Pac-12 Networks

16 September 2014 | Posted in SportsPro Blog | By Ian McPherson | Contact the author

West Coast Post: Inside Pac-12 Networks

Courtesy of Pac-12 Networks

The college football season is well underway and the Pac-12, one of the country’s most prestigious athletics conferences, is leading the charge through its wholly-owned media company, Pac-12 Networks. In the first instalment of a new weekly column from the US, SportsPro's Ian McPherson went along to the Pac-12’s offices in San Francisco to talk business with commissioner Larry Scott and check out its production facilities.

A walk around the new offices, where Pac-12 Networks’ nearly 200 media staff were recently joined by the conference’s 40-strong team of administrators, feels more like a showroom tour rather than a trip through the nerve-centre of perhaps the most lucrative amateur sports organisation in North America.

Pac-12 Networks is the only multimedia company wholly owned by its university membership, comprising one national television network and six regional affiliates. 850 sports events are broadcast live every year across its numerous platforms, while a host of original content is produced at its San Francisco headquarters, which opened for business in 2012.

"I wanted us to have our own media company so that we could be masters of our own destiny"

It’s a big operation and, consequently, it attracts big investment. ESPN and Fox are reportedly paying US$3 billion over 12 years for a package of its programming, which equates to almost US$21 million annually for each of the conference’s 12 member schools. It is the largest TV deal in college history and one which put the wheels in motion for Larry Scott, the conference commissioner since 2009.

Courtesy of Pac-12 Networks

“We were able to get some prepayments from ESPN and Fox,” explains Scott when asked how the network, one of his “half a dozen or so” initiatives upon taking up the role, was financed. “We did a 12-year deal, a lot of money. We got them to front some of the payment that helped with some of the startup cost, and we were able to manage the rest off our cashflow. We’ve got a great cashflow because we generate so much money off the sale of TV rights and other things.”

Although ESPN and Fox have a substantial portfolio of Pac-12 programming, the conference retained a large chunk of rights - including 35 football games a year and 150 men’s basketball games - to create a valuable TV proposition in its own right.

“I wanted us to have our own media company so that we could be masters of our own destiny in programming and controlling our own content and exposing sports that we wanted to expose in addition to football and basketball.

“We use the power of football to create leverage to get distribution that now gives us the opportunity to create great exposure for all these other sports, like men’s and women’s tennis and golf, swimming, soccer, diving. We’ve got over 100 women’s volleyball games, similar number of women’s softball and baseball games. It has created an incredible platform of exposure for the student-athletes that participate in these sports."

The Pac-12 Networks side of the office features 12 edit booths which handle pre and post-production and the ‘bullpen’, which houses a team dedicated to real-time editing during live events. This area is at maximum capacity during Saturday football games and is responsible for generating instant replays and highlights.

"There was a sense the conference had fallen behind its peer conferences competitively, financially, and in prestige and exposure."

“None of that was on the drawing board when I arrived in 2009,” says Scott, who joined the conference from the Women’s Tennis Association (WTA) having previously played professional tennis. “At the time I knew the conference was very prestigious, it had a great heritage of athletic success and academic strength. There was a sense the conference had fallen behind its peer conferences competitively, financially, and in prestige and exposure. I knew there was a television deal that was coming up in 2011 so I’d have a little time to figure out what we might do to reverse the worrying trends and to unlock value.”

Although it is not alone as a collegiate media channel, the Pac-12 is unique in its ownership structure. The rival Southeastern Conference’s channel is 100 per cent owned by ESPN, while Fox owns a majority share in the Big Ten’s channel. Those structures may be be safer but they come with a cost.

“They’ve chosen to mitigate the risk by giving the rights to a media company,” Scott explains. “The SEC network is 100 per cent owned by ESPN so they don’t have the risk, they also won’t get some of the reward and opportunities that we have.”

"They don’t have the risk, they also won’t get some of the reward and opportunities that we have.”

Pac-12 Networks was certainly a risk for the conference’s incoming commissioner five years ago but it is already paying dividends. However, plenty of work remains to be done. “It does require financial risk although we have been profitable from the first year so we’ve done well in that regard, and it’s not easy to get distribution for your network so you’re going to have some disputes and conflict with operators.

“We’re fortunate that we’ve got over 60 different distributors carrying the network. But we don’t have full distribution yet so we’re in a battle with DirecTV and that’s uncomfortable. You get some frustration from fans that can’t get it yet because we’re not fully distributed. You’ve got to be prepared to take some risk and deal with some conflict to launch and make successful a media company.”

As an extension of its 12 member schools, Pac-12 Networks also maintains a commitment to education, offering live production training and paid internships for students from Pac-12 institutions. “Since we've launched, students who were interested in learning about and working in television production have been a part of our team,” explains Lydia Murphy-Stephans, the president of Pac-12 Networks.

“Over the past two years, Pac‑12 Networks have created the most extensive remote TV production training program in the country, offering students at all 12 of our universities an opportunity to get valuable training from skilled professionals and hands on experience while being paid for their work."

Ian McPherson is SportsPro’s US correspondent based in Los Angeles. Get in touch by email ian.mcpherson@live.co.uk or Twitter: @iomcpherson

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