Mere weeks ago, many were drafting eulogies for the Big 12, as Texas A&M announced its departure from the conference to join the SEC.
However, with TCU’s acceptance of an invitation to join the conference on October 10, the Big 12 not only gained a tenth member, but arguably reclaimed some stability.
TCU is presently a member of the Mountain West Conference and was set to join the Big East next summer. However, in announcing that it will join the Big 12 in 2012, TCU effectively exited the Big East before ever competing within the conference.
TCU’s move to the Big 12 presents several incentives which will be enjoyed by the university and conference.
a. For TCU
As noted above, TCU was set to join the Big East next summer. That being said, its 11th hour switch to the Big 12 does not come without financial consequences. Reports indicate that TCU will have to pay the Big East a $5 million exit fee.
Most would balk at the thought of a school shelling out $5 million to swap out its conference affiliation. However, the size of the Big East’s exit fee and TCU’s willingness to pay it signals just how much the school expects to gain financially by joining the Big 12.
Last week, the Big 12’s members voted to distribute revenue earned from its television contracts equally amongst its members. Presently, the Big 12 is a party to a first-tier television rights contract with ESPN worth $480 million. Next year kicks off the start of a 13-year second-tier television rights contract with Fox worth $1.17 billion.
The Big East’s first-tier television rights contract with ESPN expires in 2012 and is worth $200 million. The Big East is also party to a second-tier television rights contract with CBS worth $54 million.
Thus, while for some it may seem preposterous that TCU was willing to fork out $5 million to exit a conference it never played a game in, its Board of Trustees arguably realized the television revenue earning potential the school could reap through Big 12 membership.
b. For the Big 12
Although some believed the Big 12 to be on its deathbed several weeks ago, the conference’s extension of an invitation to TCU was not one made out of pity for the university.
Rather, the Big 12 clearly realized the money-making potential TCU brings to the conference. TCU is located in Fort Worth, Texas, which is less than forty miles away from Dallas. Dallas is home to the fifth-highest rated TV market. This ranking makes Dallas the highest-rated TV market for all of Texas. By adding TCU to its conference roster, the Big 12 enters this fruitful market and can use this to negotiate future TV contracts.
Along with providing the Big 12 with a connection to the fifth-largest media market, geography likely factored heavily into both TCU and the Big 12’s decision to join forces.
It is no secret that Texas is a hotbed for high school football talent. Securing a fourth Texas school into its conference gives all Big 12 members a significant advantage over other conferences in recruiting this talent.
Big 12 college coaches can lure Texas recruits to play for them by promising them the ability to play before their family and friends in their hometown. With four Big 12 teams being located in Texas, a recruit who signs with a Big 12 team will play at least four games a season in his home state. Additionally, schools like Oklahoma are a short drive away from TCU. Thus, non-Texas based Big 12 schools can likewise use the addition of the Fort Worth-based TCU to the Big 12 as a recruiting tool.
As noted above, TCU was set to join the Big East. While likely a small factor when considered in the grand scheme of things, the university’s athletic department will incur much lower travel expenses by moving to the Big 12. Four of the ten Big 12 schools are located in Texas. When forced to travel outside of Texas, TCU will visit Oklahoma, Missouri, Iowa and Kansas. Had TCU remained in the Big East, it would have to travel on a frequent basis to places like Connecticut, Pennsylvania, New York, Wisconsin, Washington D.C. and New Jersey to compete. Staying closer to home undoubtedly curbs travel expenses.
TCU has had well-documented success on the gridiron in recent years. Last season, the Horned Frogs went undefeated in football and won the Rose Bowl.
The Big East has a storied history as a basketball powerhouse. In fact, its basketball teams perform so well, that it is one of the only conferences which earned more money from its basketball teams than its football teams.
For the period between July 2009 to June 2010, TCU’s football revenue was $20,609,361.00. The average football revenue for Big East teams was $18.8 million, while football revenue for Big 12 teams was $35.4 million on average. Thus, although TCU’s football revenue is less than its new Big 12 peers’, it was larger than teams in the Big East. By moving to the Big 12, TCU has arguably set itself on good footing to earn even larger amounts of money from one of the biggest revenue streams in college sports.
All in all, it appears that TCU’s move to the Big 12 is a win-win situation for the university and the conference.