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Would each full AAC member earn an extra $7M over 12 yrs. by sticking with 11 teams?
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jedclampett Offline
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Would each full AAC member earn an extra $7M over 12 yrs. by sticking with 11 teams?
In the discussions about potentially adding a 12th AAC member - - which would be an option if a change in the FB championship rules can't be obtained from the NCAA - - one issue has popped up:

If a FB championship rules aren't changed, the conference might possibly be the most inclined to stick with 11 teams, if the AAC schools would benefit financially by staying with 11 teams throughout the 12-year duration of the new ESPN contract.

However, there seems to be a lack of consensus about whether or not the all-sports AAC members would receive an extra benefit by deciding not to replace UConn in both sports.

Some have suggested that the payments from ESPN that would have gone to UConn would be "divvied up" among the remaining AAC members.

Others seem to disagree or to be uncertain about this, wondering if instead, ESPN is simply going to pay the contractual amount of $6.8 million per year to the full AAC members.

All that seems clear is that contract has a proviso ensuring that the AAC won't be penalized financially for losing a single team.
This could either mean that each school will receive a contractually agreed amount directly from ESPN, or that the AAC as a conference will receive a contractually agreed amount totaling the complete amount that would have gone to each AAC member, including UConn.

My guess is that the AAC/members will receive the previously announced payments with the amount that would have gone to UConn being retained by ESPN. But the other option might be equally possible.

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IF THE AAC WERE TO LOSE ANOTHER MEMBER OR TWO, THE PAYMENTS WOULD APPARENTLY HAVE TO BE RENEGOTIATED LOWER:

When considering any potential $$ or other benefits of staying with 11 teams, it's also of note to consider the possibility of significantly decreased payments if the membership drops to 10 teams.

Few expected UConn to leave the conference, and few expect another member to leave, but one of the risks of staying with 11 teams is that it would make the conference members much more vulnerable to a significant loss of income from ESPN.

Correspondingly, by replacing UConn, the AAC members could protect/insure themselves from any loss of income that would occur if any other AAC member(s) should leave the conference in the next 12 years.

Those P5 conferences with 14 teams decided to expand, in part, to generate additional income by expanding their TV market. In doing so, they also gained an assurance that their media payments wouldn't collapse completely if they were raided by another conference.

Both the AAC members and ESPN could benefit financially, in the long run, by eventually expanding the AAC market size beyond 12 members at some point in the next 12 years. A future expansion to 14 members would generate a substantial increase of income, but just as importantly, would help to protect the members from substantial losses if the AAC ends up being raided by any of the P5 conferences (which is not a very remote possibility).
(This post was last modified: 10-24-2019 09:44 PM by jedclampett.)
10-24-2019 09:37 PM
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