The fall of the Pac-12
A timeline of the events leading up to the demise of the Pac-12 Conference
The fall of the Pac-12 Conference ultimately comes down to a lack of sound negotiating, poor business execution, a declining product on the field, and failure to stay alert in a changing collegiate athletics landscape.
What was a storied and thriving conference is now down to two teams, Oregon State and Washington State. USC and UCLA fled to the Big Ten, followed by Washington and Oregon. Colorado, Arizona, Arizona State, and Utah joined the Big 12. Finally, Stanford and California left to join the new cross-country ACC.
July 2009 - Larry Scott is hired as the Pac-10 commissioner
As the CEO of the Women's Tennis Association, Larry Scott was known for his marketing and TV expertise. His skill set was what the Pac-10 needed with its current TV rights deal set to expire over the next couple of years.
January 2010 - Pete Carroll leaves USC
It’s reported Pete Carroll will be leaving USC for the Seattle Seahawks after a disappointing 9-4 season. This came after seven straight years of no more than two losses, including two national championships. A few months after Carroll’s departure, USC received a two-year postseason ban for rules violations and struggled for the next 10+ years by USC standards.
With its premier school no longer in the national spotlight, Oregon and Stanford took center stage. Oregon lost in two national championship games before leveling off. Washington had its short-lived moment. Utah, more recently, has been good enough to win the Pac-12, but not good enough to realistically have a shot at the College Football Playoffs. Pete Carroll, Reggie Bush, and Matt Leinart are the last memories of a Pac-12 national championship team.
June 2010 - The Pac-10 missed a chance at adding Texas and Oklahoma
Texas and Oklahoma, among other Big 12 teams, are speculated to join the Pac-10. However, the Big 12 accommodated Texas’ TV network so they didn’t have to share revenue equally with the rest of the league like the Pac-10 was requesting. If Scott was willing to let Texas have its way in the Pac-10, Texas likely would have made the move and brought Oklahoma, which would be the foundation of the most competitive league in college football for years to come.
May 2011 - New TV deal
Scott negotiated a 12-year deal with Fox and ESPN worth almost $3 billion after a bidding war with Comcast. The deal paid the league between $225 - $250 million annually, nearly quadrupling revenue from its last TV contract. It was the biggest TV rights deal of any of the Power Five conferences at the time.
July 2011- The additions of Utah and Colorado
After nearly swooning Texas and Oklahoma, Scott was able to bring in Utah and Colorado. This led to the rebranding from the Pac-10 to the Pac-12.
November 2011 - The Pac-12 was at the center of the college football world
College Gameday visited Stanford as the third-ranked Cardinal took on sixth-ranked Oregon. The Pac-12 finished the regular season with three of the top six teams in the nation. Scott was winning at life. His product was not only competing and winning on the field, but he was also winning in the boardroom with his huge TV contract.
December 2011 - The Pac-12 moved into new headquarters
With new cash on hand, the Pac-12 signed a lease for a 70,000-square-foot office in San Francisco. It also would serve as the home for the Pac-12 Network. The Pac-12 spent almost $7 million a year in rent. At the center of the tech world, the Pac-12 wanted to be perceived as innovative and state-of-the-art, just like the tech community it resided in.
August 2012- The Pac 12 Network is created
Previously announced, the Pac-12 Network launched. The network would control and distribute all the Pac-12 games not licensed to ESPN and Fox. The Pac-12 Network launched with distribution through Comcast, Time Warner Cable, Cox Communications, and Bright House Networks. However, the cable operators put the network on poorly distributed payment tiers, some of which were outside of the Pac-12 footprint. This resulted in fewer homes paying for the Pac-12 Network than anticipated.
After three years, the Pac-12 Network was only paying schools around $1 - 1.5 million annually whereas the SEC Network was paying schools $7.5 annually during the same timeframe. There was even a chance to gain additional distribution via DirectTV, but the league presidents rejected any offers made.
June 2013 - The Pac-12 led collegiate leagues in revenue
The Pac-12 had the most revenue in collegiate sports. With other leagues not yet capitalizing on huge TV deals, the Pac-12 was viewed as the top of the food chain when it came to the business of college sports.
June 2014 - Sentiment takes a hit as Pac-12 spending is reported
CBS Sports reported that the Pac-12 returned just 68% of its revenue to the schools in 2013. The other Power Five conferences returned at least 90% of their league revenue to its members. Blame is put on the costs incurred from running the Pac-12 Network due to new studio spaces and the San Francisco offices.
December 2016 - Washington lost in the College Football Playoffs
Washington secured the #4 seed in the College Football Playoffs only to lose 24-7 to Alabama in the semifinal. The Pac-12 hasn’t produced a team that has made the College Football Playoff since.
December 2017 - The Pac-12 showed poorly in bowl games
Postseason woes continued for the Pac-12 going just 1-8 in bowl games, the worst record ever by a Power Five conference. Its only win came from Utah, which played in a non-affiliated bowl and was only 3-6 in conference play. School presidents started to get concerned. Washington State’s Kirk Shulz said, “The Pac-12 schools have got to be competitive with the ACC, the SEC, the Big Ten, and Big 12, and we're falling behind."
November 2018 - John Canzano reported Scott’s salary
John Canzano, a sports columnist, exposed Scott’s salary of $4.8 million and how it was head and shoulders above Commissioner Greg Sankey’s $1.9 million of the SEC and Commissioner Jim Delany’s $2.4 million of the Big Ten. Scott made more than any coach in the Pac-12 while Sankey made less than every coach in the SEC. A year later, with revenues declining slightly, Scott received a $500k raise.
January 2019 - The Pac-12 pursued private equity
With the league unable to increase revenue through the Pac-12 Network and struggling with a high-cost structure, Scott pursued a private equity partner. He was looking for $500 million in exchange for 10% of the Pac-12, which included the Pac-12 Network, commercial assets, broadcasting and sponsorship rights, merchandising, and distribution agreements. Scott later reports that the school presidents voted against the proposal.
January 2021 - Scott is replaced by George Kliavkoff
Scott’s tenure as the Pac-12 commissioner ended in January and he was replaced by George Kliavkoff in May. Kliavkoff was the President of Entertainment and Sports at MGM Resorts International. The number one objective on his plate was to negotiate a new TV deal as the current 12-year deal with ESPN and Fox was coming to a close in a couple of years.
July 2021 - Texas and Oklahoma announced they are joining the SEC
Texas and Oklahoma shocked the sporting world by announcing they would be joining the SEC. In the aftermath of the announcement, the ACC, Big Ten, and Pac-12 allied with the intent to combat the SEC’s expansion and poaching of their leagues. Though no formal agreements were made, Jim Phillips, the ACC commissioner said, “We looked each other in the eye.” The Big 12, having just lost Texas and Oklahoma, were not a part of “the alliance” as they sought to rebuild their conference.
The Pac-12 could have taken a different approach and gone after remaining Big 12 schools to build out their conference but instead did nothing.
June 2022 - USC and UCLA left for the Big Ten
Less than a year after “the alliance” was formed, USC and UCLA decided to leave for the Big Ten. USC and UCLA had more trust in the Big Ten to deliver financially for their schools. Two months after their announcement to leave the Pac-12, the Big Ten announced a seven-year, $8 billion media rights deal with CBS, Fox, and NBC. The Big Ten contract with three key networks made negotiating that much more difficult for the Pac-12 as they sought a new deal.
October 2022 - The Big 12 signed a new media rights deal
Despite having additional years remaining on its TV rights deal, the Big 12 was proactive and signed a six-year, $2.3 billion deal with ESPN. The deal paid each school in the Big 12 $32 million per year.
Canzano reported that less than a year earlier, the Pac-12 had a potential offer on the table with ESPN that would have paid each school $30 million per year. The Pac-12 presidents wanted an offer closer to what the SEC and Big Ten were being valued at. Kliavkoff couldn’t convince the league presidents to sign. He countered at $50 million per school, which is when negotiations abruptly ended.
July 2023 - Colorado left for the Big 12
Colorado wasn’t willing to wait for a new media rights deal to be presented and decided to leave for the Big 12. The Pac-12 would soon be down to nine schools and was without Colorado’s first-year coach, Deion Sanders, a huge marketing asset that could have been leveraged in negotiations.
August 2023 - Kliavkoff presented the Apple deal
Kliavkoff presented a deal with Apple that would pay schools $23 million a year. Apple later upped the offer to $25 million per school. The crux of the deal was the additional financial incentives that would be delivered if certain subscription thresholds were met. Essentially, the Pac-12 would be selling Apple TV subscriptions. This was a tough pitch to schools that just 12 years earlier were sold on the Pac-12 Network, which fell far short of its revenue goals because they couldn’t acquire the projected subscriptions.
Despite the unfavorable challenges with the deal, most of the remaining nine schools were prepared to sign on the dotted line. However, right before a deal was finalized Oregon and Washington decided to flee to the Big Ten. The news spurred the departure of Arizona, Arizona State, and Utah who left for the Big 12. Later, Stanford and California accepted a spot in the ACC. The only remaining schools are now Oregon State and Washington State.
What’s next?
The collapse of the Pac-12 is a story that could have been prevented. According to reports, Oregon loved the idea of being the heavyweight in a smaller conference. They now will be competing in an 18-team conference with Ohio State, Michigan, Penn State, and USC. Arizona State and Utah didn’t want to join the Big 12 but felt they had no choice.
The saddest part is that the Pac-12 is having its best year in recent memory with two teams (Washington and Oregon) currently competing for a chance at the College Football Playoffs. We all know college football drives the business of college athletics, but so many non-football athletes are also impacted by all the changes.
The collapse of the Pac-12 will be a tale of what-ifs. What if Texas and Oklahoma joined the league? What if the Pac-12 decided to poach members of the Big 12 after the departure of Texas and Oklahoma? What if the Pac-12 Network got better distribution? What if the Pac-12 was more financially disciplined? What if the Pac-12 had more urgency in signing a new TV rights deal and were more realistic about what they could fetch given their recent struggles on the field?
Oregon State and Washington State are expected to operate as a two-team conference for at least a year. They have had discussions with the Mountain West Conference to enter into a shared schedule. If things work out, there could be an opportunity to merge with the Mountain West. Even if the Pac-12 survives in name, everything else about it will be different. Time will tell what is next for the once-prominent collegiate sports league.
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