The industry is on edge as College Football Playoff leaders continue to consider the company's future.
The Big Ten and SEC have that proverbial power. The Big 12 and ACC are struggling to come to a compromise.
The playoff format and revenue model remains in circulation.
The deadline is approaching. There is no consensus.
And for some, there is an alarming certainty. A deal would drive an even wider financial wedge between the four major conferences.
The CFP is moving toward a new format and revenue model that leans toward the new Power 2 of college athletics, creating a more formal demarcation line between the two groups: the SEC and the Big Ten. ACC and Big 12.
The Power Two separated long ago due to increased revenue streams and recent business expansion, but the new playoff model is expected to draw a more permanent line. The unequal distribution of revenue is creating a visible divide between college football's power players and those who were once true equals in the field.
A person with knowledge of the proposal spoke to Yahoo Sports on condition of anonymity.
“Two leagues are asserting their power,” said one college athletics administrator.
CFP format and revenue distribution
Any decision regarding the format of the playoffs would take a backseat to a more important factor: money.
A revenue-sharing model has emerged that would give the SEC and Big Ten millions of dollars in additional revenue each year over the two power league teams. Although an expected move, the numbers shocked those who saw the proposal.
Under the previous structure, the five major conferences would split 80% of CFP's $460 million in revenue roughly evenly.
Under the proposal reached with administrators this week, the Big Ten and SEC would collectively receive about 58% of CFP's base distribution. This number is sure to increase as each school earns more money by qualifying and advancing through the playoffs. . This number would significantly exceed the combined ACC and Big 12 distribution, which is expected to be about 31%. The remaining amount (approximately 10%) will be split between Notre Dame and 5 teams in the Group of 64.
The difference in distributions between the two sets of conferences, the SEC/Big Ten and ACC/Big 12, could exceed $300 million annually. The Power Two's combined revenue will be about $760 million, compared to the ACC and Big 12's about $440 million. Approximately $115 million will be allocated to Group of Five.
The CFP is expected to distribute approximately $1.3 billion per year in its new television deal with ESPN, triple the amount of the previous deal in the four-team version, so there will be no reduction in revenue for any school. . Participating distributions are expected to account for only $100 million of total distributions. Each team will earn between $3 million and $5 million each for participating in and advancing to the playoffs.
Taking into account distribution rates, SEC teams will earn $23 million annually, the Big Ten $21 million, the ACC about $13.7 million and the Big 12 about $12.3 million. Group of Five teams are expected to earn just under $2 million.
The deal is expected to include a final “look-in” clause in 2028. The look-in clause may be triggered prior to that date by rescheduling the meeting. The provision was encouraged to be added by Big 12 Commissioner Brett Yormark, officials said. With discussion.
The format of the playoffs has not yet been determined.
A variety of 14-team formats continue to circulate across the industry, including one that made news last week. This gives three automatic qualifiers to the SEC and Big Ten, two each to the ACC and Big 12, and one automatic qualifier to the highest-ranked Group of 5 program, with three at-large spots (3-3- 2-2-1). +3 models.
There is also a 2-2-1-1-1+7 model. This gives them seven automatic spots: two each in the SEC and Big Ten, one each in the ACC and Big 12, one each in the highest-ranked Group of 5, and seven at-large spots. There is also a 5+9 model that mirrors the current 5+7 12 team format, but with two additional at-large spots. Presumably, that model would award automatic berths to the conference's top five champions.
The concept of the Big Ten and SEC holding exclusive rights to two first-round byes has received enough backlash that many expect it to be put on hold.
Money is more important.
Revenue matters more than ever. Major conferences and their members are preparing for future athlete compensation models. This concept requires securing extra cash flow for players, whether through employment, revenue sharing or collective bargaining.
The traditional method of equally distributing revenue has recently broken down at the conference level. Washington and Oregon received discounts for joining the Big Ten. SMU, University of California, and Stanford University also joined the ACC. The league currently distributes funds primarily based on football performance rather than equally.
Now, this trend has reached the national stage. The CFP-based revenue sharing model is primarily based on historical playoff success over the past decade. Considering future realignment moves, the SEC and Big Ten will account for 72.5% of CFP participants. Considering Oklahoma and Texas, the SEC leads all schools with 17 in the four-team field. Next, the Big Ten will have 12 schools, considering the four new schools. The ACC (seven teams) and Big 12 (two teams) follow.
“I'm watching this real conference dissolve,” Washington State President Kirk Schultz, the Pac-12 representative on the CFP board, told Yahoo Sports last month. “At least when it comes to football, you have the Big Ten and the SEC, and then you drop down to the ACC and the Big 12, and then you drop down to the Mountain West and the AAC. The Pac-12 is somewhere in there. From the Big Ten and the SEC. I'm glad to see national leadership. Someone needs to take the reins, but if you don't happen to be in the Big Ten or the SEC, it's probably a little scary. There's no indication that things are going to go this way. Will it come out? ”
Formalities aside, the split of the money alone is causing anxiety in both the ACC and the Big 12, with some administrators asking troubling questions such as:
“If we say no, will Power Two really leave?”
What position does ACC have in this regard?
The impact of college football's new class could be far-reaching, but nowhere more so than in the Atlantic Coast Conference.
ACC's predicament, which prevents some of the biggest brands from exiting, is likely to worsen as CFP further defines the industry's power structure. Gaps in the revenue-sharing model could encourage more programs to follow Florida's example and seek legal exits.
Seven ACC schools (FSU, Clemson, Miami, North Carolina, NC State, Virginia, and Virginia Tech) lost most of their money from ACC grants last year, as their television contracts fall further behind the Power Two financially. They held their own meetings to explore potential exit strategies. right. Leading the trip were Florida State and Clemson, two of the most disgruntled and possibly prized programs seeking a new conference. FSU took the first step in its withdrawal strategy in December, filing a lawsuit against the league. A trial date is set for later this spring.
Clemson's lawyers have been preparing for their own lawsuit in recent months, a source familiar with the discussions tells Yahoo Sports.
Further attempts at secession could throw the conference into chaos. Will they be able to get out of entitlement as a result of leaving Florida and Clemson? — may chart a path to North Carolina for the other members of the seven, especially the program's most attractive.
Could the seven separate and leave the league to reinvent itself as a smaller, more valuable conference? Is it possible some of the seven will join a new conference (Big 12, SEC, or Big Ten)?
A date looms as a potential turning point in the ACC's future.
ESPN's contract with the ACC extends through 2036, but the network has the option to opt out of the final nine years starting in 2027, which would allow ESPN to restart its own rights grants or at least close the organization. There is a possibility of rebuilding. transaction.
Could a restructured agreement with unequal distribution prevent further withdrawals? If ESPN opts out, will it pave the way for more schools to pull out?
The network has until February 2025 to exercise this option.
Timeline
According to independent reporting, ESPN is in the final stages of agreeing to a six-year extension with CFP that will pay out approximately $1.3 billion annually through 2031 and include 12 teams in 2024 and 2025. However, starting in 2026, there will probably be 14 teams.
The proposal has been the subject of debate for more than a month, as CFP leaders debate a variety of issues, including the playoff format, revenue-sharing model and voting structure. Network officials have communicated the need for the decision.
Some sort of internal deadline has been set by the end of next week for the conference to agree to or bail out the future CFP framework, and possibly the entire contract with ESPN. It is not yet entirely clear how a deal will be reached, as there is currently no contract or voting system in place beyond the 2025 playoffs. The deal with ESPN is the only one that binds the 10 leagues and Notre Dame.
Unanimity is not and will not be a requirement for new contracts. This is expected to result in changes to the playoff voting structure. It is hoped that these conferences and Notre Dame will be part of his CFP in 2025 and beyond as they actively work on the future framework.
