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Tanner: Year 1 SEC Network Payout to be at least $5 million per school
Posted on 2/20/15 at 2:39 pm
Posted on 2/20/15 at 2:39 pm
Initial Projections said it would be Year 3 before schools got payouts, but, well, you know...
“Long story short, when we first started talking about the network, they said we’d probably realize a benefit in Year 3,” Tanner told the BOT. “Obviously it’s been more successful than that. This summer we’ll receive a distribution (and) I think it will be at least $5 million. I’d like to think that’s on the conservative side. Each school will receive a $5 million gain.”
“Long story short, when we first started talking about the network, they said we’d probably realize a benefit in Year 3,” Tanner told the BOT. “Obviously it’s been more successful than that. This summer we’ll receive a distribution (and) I think it will be at least $5 million. I’d like to think that’s on the conservative side. Each school will receive a $5 million gain.”
This post was edited on 2/20/15 at 2:40 pm
5
Posted on 2/20/15 at 2:42 pm to GoldenFlakes
Posted on 2/20/15 at 2:50 pm to GoldenFlakes
What's the number projected to be down the road? I saw it may be worth 500 mil someone said eventually but payout wise what are we looking at- any idea?
Posted on 2/20/15 at 2:53 pm to piggilicious
quote:
What's the number projected to be down the road? I saw it may be worth 500 mil someone said eventually but payout wise what are we looking at- any idea?
That depends on the per subscriber price, which we won't know until we can back calculate this stuff.
What $5 million a year does is push each SEC school past EVERY non-Notre Dame ACC school, every PAC school, and all but a handful of Big 12 schools.
Posted on 2/20/15 at 2:53 pm to GoldenFlakes
So they ruined scheduling and subjected us to Mizzou and tamu fans for $5 million a year. Fantastic
Posted on 2/20/15 at 2:55 pm to Tooncesridesagain
Posted on 2/20/15 at 2:55 pm to cardboardboxer
Well I didn't have to pay extra myself - I'm just confused on how this stuff works I guess. At this point I'm thinking 5 mil isn't all that for having to put up with all y'all.
Posted on 2/20/15 at 2:55 pm to Tooncesridesagain
Oh wow, a LSU fan complaining. What a rare sight.
This post was edited on 2/20/15 at 2:56 pm
Posted on 2/20/15 at 2:56 pm to Tooncesridesagain
quote:
So they ruined scheduling and subjected us to Mizzou and tamu fans for $5 million a year. Fantastic
Sounds like the number will likely grow from this level in the coming years. As Tanner said, when they were planning the launch, they weren't expecting ANY payouts this year or even next year as things ramped up.
This post was edited on 2/20/15 at 2:57 pm
Posted on 2/20/15 at 2:58 pm to Tooncesridesagain
How were your last two seasons? I'll wait...
Posted on 2/20/15 at 2:59 pm to piggilicious
quote:
I'm just confused on how this stuff works I guess.
It is pretty simple: cable companies pay so much per subscriber for the SEC Network, and the cost is more inside the SEC footprint. This revenue then gets applied against costs and ESPN's cut. What is left over gets split 15 ways (the front office takes an equal share) and then each program gets 1/15th that revenue.
Seeing as how every quote implies this is low due to startup costs, I assume year two will be gang-busters and year three will be the full payout (which I personally expect to be over 10 million per team a year).
And don't scoff at $5 million, that is a fourth the TOTAL distributed TV revenue a conference like the PAC gets. The SEC still gets Tier 1 revenue on top of this plus probably some extra ESPN revenue for Tier 2 (aka the stuff that is on ESPN 1/2).
With this extra revenue the SEC jumps from the worst paid power 5 conference to the second best paid.
This post was edited on 2/20/15 at 3:02 pm
Posted on 2/20/15 at 3:02 pm to GoldenFlakes
over 5 million, less than a full year, added start-up expenses.
I expect team will start cashing yearly payments approaching 15 million soon, which is pretty close to the ridiculous numbers that were thrown around.
I expect team will start cashing yearly payments approaching 15 million soon, which is pretty close to the ridiculous numbers that were thrown around.
Posted on 2/20/15 at 3:03 pm to cardboardboxer
quote:
It is pretty simple: cable companies pay so much per subscriber for the SEC Network
Makes sense since all of the concern before it started about providers carrying the station - that's was due to the providers battling out what their pay would be I assume.
quote:
, and the cost is more inside the SEC footprin
I don't really understand what you're saying there though?
Posted on 2/20/15 at 3:04 pm to cardboardboxer
quote:
It is pretty simple: cable companies pay so much per subscriber for the SEC Network, and the cost is more inside the SEC footprint. This revenue then gets applied against costs and ESPN's cut. What is left over gets split 15 ways (the front office takes an equal share) and then each program gets 1/15th that revenue.
Seeing as how every quote implies this is low due to startup costs, I assume year two will be gang-busters and year three will be the full payout (which I personally expect to be over 10 million per team a year).
And don't scoff at $5 million, that is a fourth the TOTAL distributed TV revenue a conference like the PAC gets. The SEC still gets Tier 1 revenue on top of this plus probably some extra ESPN revenue for Tier 2 (aka the stuff that is on ESPN 1/2).
With this extra revenue the SEC jumps from the worst paid power 5 conference to the second best paid.
All of this, plus a great channel to watch so many great games on. Wherever we are, we can watch out teams play.
I love it.
Posted on 2/20/15 at 3:04 pm to cardboardboxer
That's a far cry from the $30 million per year payout I've seen aggies spew across the Internet...
Might have to sell more bonds or raise the hotel tax more to pay for all those upgrades.
Might have to sell more bonds or raise the hotel tax more to pay for all those upgrades.
Posted on 2/20/15 at 3:05 pm to texashorn
Why are you posting here?
Posted on 2/20/15 at 3:06 pm to Hugh McElroy
churches around north east bama and north west Georgia will be splitting auburns money.
Bama will put its money in recruiting
ole miss money is going to hospice care for its remaining sec champion football players.
Bama will put its money in recruiting
ole miss money is going to hospice care for its remaining sec champion football players.
Posted on 2/20/15 at 3:07 pm to texashorn
quote:
That's a far cry from the $30 million per year payout I've seen aggies spew across the Internet...
link?
Posted on 2/20/15 at 3:08 pm to Hugh McElroy
quote:
All of this, plus a great channel to watch so many great games on. Wherever we are, we can watch out teams play.
That's the best part. Without sounding too greedy even 15 mil doesn't sound outrageous to me. Now I'd take it personally but...
Posted on 2/20/15 at 3:08 pm to piggilicious
quote:
that's was due to the providers battling out what their pay would be I assume.
Exactly. ESPN was asking for $1.25 per in the footprint, no clue what they got in actuality though.
quote:
I don't really understand what you're saying there though?
A cable subscriber in Arkansas is worth over a $1.00 per month, while one in Oklahoma is worth something around a quarter a month. That is all that means.
This whole thing is built on a screwy business model pioneered in the B1G where states inside the conference footprint pay more for access to the network. Hence why adding Texas and Missouri was important- it tripled or more what ESPN could charge for those cable subscribers.
Given the very high distribution of the SEC Network year one I think ESPN gave a break on the cost early on. Once it is established is when they like to jack up the rates (like they do with ESPN 1). That is why year 3 is the year I am watching for.
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