SEC and Big Ten are super conferences on another level

Joe Rexrode

The Tennessean

The term “Power 5” is just 2 years old, and already we may need a new one to accurately describe the tiers of conference clout in college athletics.

The SEC's television contract with worth $3 billion. The SEC head football coaches earn an average of $4 million per year. Yes, the SEC is big business.

Super Power 2? Dominant Duo? The New Odd Couple?

They’re easier to identify than they are to give a cute name — the Southeastern Conference and Big Ten are in position to widen their financial advantage over Power 5 cohorts ACC, Big 12 and Pac-12.

The Big Ten’s recent success in negotiating a massive TV deal proved that the broadcast giants aren’t done paying premium rates for college sports. And though the cable industry could change significantly by the time the SEC’s deal with CBS expires in 2024 (the SEC and ESPN are aligned until 2034), the league should be in strong position when it does.

“The SEC and Big Ten are poised for separation, and the difference makers for both are their networks,” said Jeff Nelson, vice president for client strategy at Chicago-based Navigate Research, which evaluates sports and entertainment marketing investments. “The SEC, no matter what, is going to be in good shape, because it has strong, passionate fan bases and the top level of play. The Big Ten will be in great shape and right now might even be above the SEC, but if I had to bet on just one conference in the long run, no matter what the landscape looks like, it would be the SEC.”

Already, the SEC stands alone in terms of investment in football, the sport that drives most of the money changing hands. According to USA Today salary figures for last year, the SEC had the highest-paid coach (Alabama’s Nick Saban, $7.09 million) and 10 of the top 18, with no one making less than $3.26 million (there were no figures available for Vanderbilt, a private school).

Average SEC head coach pay was $4.28 million, while the other four Power 5 leagues averaged $3.11 million per head coach. Just six coaches from other leagues made more than the SEC average last year.

The Ultimate SEC Guide

The difference in pay for assistant football coaches is just as striking. The SEC had the five highest-paid staffs last year, led by LSU’s $5.47 million for its nine full-time assistants.

The average per team was $4.03 million, more than all but three teams from other leagues, (Clemson, Florida State, Michigan), while the other four leagues combined to average $2.96 million per coaching staff.

SEC schools averaged $8.31 million in combined head coach/staff pay last year, with the Big 12 the next-closest at $6.3 million. All the Power 5 leagues have at least one school that isn’t required to report its figures, so they aren’t complete, but they are telling nonetheless.

And the revenue numbers and projections suggest no need for frugality ahead.

“From a financial standpoint, I don’t think the SEC has ever been better,” said Paul Finebaum of the SEC Network and ESPN.

The SEC has yet to release how much it will pay each school for the 2015-16 season, but the 2014-15 payout was $31.2 million per school — about $10 million more than the previous year, thanks mostly to the addition of the SEC Network.

The SEC Network and the Big Ten Network are the industry leaders and give those two leagues more clout moving forward than the other three Power 5 conferences. The Pac-12 Network has struggled to gain distribution, the ACC recently announced plans for a network to debut in 2019, and the Big 12 has no firm plans for a network (Big 12 member Texas has the Longhorn Network, which is good for Texas but a complication for everyone else).

Annual payouts from leagues to its members include TV and postseason money, and the most recent numbers for the ACC, Big 12 and Pac-12 range are in the low to mid $20 million range per school.

The Big Ten paid its full-status members $32.4 million for 2015-16, and considering the recent TV deals for its rights — $2.64 billion over six years from Fox, CBS and ESPN, according to the Sports Business Journal — it should be paying much more soon. That’s nearly triple what ESPN and CBS had been paying for the same programming, and it means the Big Ten could be doling out as much as $60 million to each of its schools by 2018.

“The Big Ten showed recently that college sports is alive and well,” Finebaum said. “A lot of people made a big deal out of it, and they should. I think (Jim) Delany is a phenomenal commissioner, and I think he guided that league very, very well. But I don’t think it means the SEC is slipping into oblivion. I think anything but. I think it shows there are two super conferences now in college athletics.”

SEC Network revenue should continue rising, but cable TV could have a different look when the next negotiations arrive. “Cord cutters” are ditching cable to stream specific content, and a large portion of TV sports revenue comes from networks gaining distribution on basic packages forcing all cable subscribers to pay for those networks, whether they watch them or not.

“Anyone who tells you they know what the landscape will look like in (a few years) either has a magic crystal ball and should be placing bets, or they’re just overconfident,” Nelson said. “The SEC will be in an interesting position in (2024). Will they stick with the traditional model for one last huge pay day? Or will they go in a new direction?”

That could mean a deal with a streaming platform, a NetFlix or a Google — the Pac-12’s recent deal with Twitter is a move in that direction — and full control of SEC content. There’s no telling how that revenue would compare, but the value of the content — especially for the Super Power 2 — is clear.

“If you’re the SEC or the Big Ten,” Nelson said, “you’re going to be in the driver’s seat of whatever landscape unfolds.”

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