SEC could’ve influenced CFP decision to not test open market, re-sign with ESPN

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One of the more puzzling aspects of the College Football Playoff’s decision to finalize a deal with ESPN for a 24-team format is why the FBS conference commissioners tasked with negotiating the deal didn’t put their inventory on the open market, where other networks and streamers could’ve bid for the event.

This decision was even more puzzling after reports surfaced that ESPN will pay only incrementally more for the 24-team playoff than it did for the current 12-team playoff. After accounting for lost revenue from conference championship games, which will be eliminated under the new format, the 10 FBS conferences will earn about $155 million more than under the 12-team system, or about 12% more than the $1.3 billion per year ESPN currently pays. That shakes out to about $2-3 million more for SEC and Big Ten schools, $1.5 million more for ACC and Big 12 schools, and $200,000 more for each Group of 6 school.

For such a drastic change, the additional revenue is borderline negligible.

Several theories explain why CFP leadership settled for such a minimal increase from ESPN rather than taking the rights to the open market. But perhaps the most compelling explanation comes from Yahoo Sports’ Ross Dellenger, who said on a recent episode of the College Football Enquirer podcast that it likely boiled down to ESPN’s ongoing partnerships with nearly every FBS conference except the Big Ten, particularly its deal with the SEC.

Dellenger resurfaced earlier reporting that the SEC has a “look-in provision” with ESPN around 2030, which could let the conference renegotiate its media rights deal at a higher rate. The SEC’s current agreement with ESPN runs through 2034 and pays the conference an average of $710 million per year, substantially less than what the Big Ten earns from Fox, CBS, and NBC ($1.15 billion per year), despite dominating the Big Ten in television viewership.

Naturally, the SEC expects its media rights fee to rise once its look-in provision kicks in, which may have motivated the conference to keep ESPN’s CFP increase lower. The SEC must share any additional CFP revenue with the rest of the FBS, while any additional revenue from its own revised deal with ESPN would stay entirely in-house. Thus, there’s incentive to keep ESPN’s coffers full rather than extracting maximum value now.

Of course, the ACC, Big 12, and many Group of 6 conferences have their own media rights agreements with ESPN. A similar theory is that those conferences would like to remain on favorable terms with ESPN for the sake of their own deals. Bringing CFP rights to the open market could jeopardize those relationships.

The decision to stick with ESPN may have cost the CFP additional revenue. Dellenger says there were “a couple of streamers that were interested in at least a piece of the playoff,” but we’ll never know how much they would’ve been willing to pay.

The jury is still out on the long-term impacts of expansion. Clearly, CFP leadership viewed the non-monetary benefits of expansion, like increasing playoff access, adding more power conference matchups in the regular season, and creating “tiered incentives” for teams of varying ability, as overwhelmingly positive. Without them, the revenue increase wouldn’t have been nearly enough to move forward with the change.

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