Big Ten wants to extend its reach
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In television parlance, it is called the conference's "footprint."
And the Big Ten wants a bigger foot.
Of all the reasons for expanding the 11-team Big Ten Conference, the one factor that would benefit the most financially relates to, of course, the tube.
"The main point of expansion for the Big Ten Network," said John Ourand, a media reporter for the Sports Business Journal, "is to expand its in-market area."
One school that doesn't seem to improve the Big Ten's television footprint is Pitt. The Panthers play in the 22nd largest media market, but the Big Ten Network is available in all but three cable operators in Pennsylvania, and Penn State has nearly 53,000 alumni in 13-county Western Pennsylvania.
"They don't need Pitt," Ourand said, "because they have the Pennsylvania market covered by Penn State."
Big Ten Commissioner Jim Delany said in Chicago this week that extending the market of the Big Ten Network, the conference's wildly successful three-year-old venture, is one of the driving forces behind the expansion study.
So, while gaining a presence in the ever-growing South and a desire to host a football conference title game are worthy by-products of expansion, the financial bottom line would be most affected by the Big Ten Network.
"(Expansion) is the most immediate manifestation of what (the network) can become," said Mike Reynolds, a news editor for Multichannel News, a magazine that covers television and cable services.
The Chicago-based Big Ten Network, 49 percent of which is owned by Fox Cable Network, has 45 million subscribers and is available to another 30 million homes.
Each conference school received $6-7 million last year from the network, and advertising revenues are up 30 percent, according to industry experts.
"I don't see it slowing down," Ohio State associate athletic director Dan Wallenberg said.
The most popular candidates to catch the Big Ten's eye are Missouri, Nebraska, Notre Dame and Rutgers, while Connecticut, Pitt, Syracuse and Texas remain possible targets.
They are desirable for different reasons and offer fertile ground for the Big Ten Network to increase its cable subscriber base.
"I'm reticent to speak on the larger issues," Iowa associate athletic director Rick Klatt said, "but, hypothetically, teams added that are not in that footprint can bring that to another level."
Since being launched Aug. 30, 2007, the Big Ten Network has grown from a fledging first-of-its-kind experiment into a billion-dollar cash cow that is the envy of every conference.
The network pays the Big Ten Conference $75 million in rights fees and, depending on expansion, income could double in the next couple of years.
The network is a key reason why each Big Ten school makes about $22 million in revenue, a figure that includes its national TV contract with ABC, bowl game payouts and NCAA Tournament funds.
The ACC, Pac-10 and SEC earn about $11 million per school, according to 2007 figures, while the Big 12 pays out between $7 million and $12 million and the Big East about $4.5 million or less per school.
The Big Ten Network is available on more than 300 cable operators nationally, including 19 of the nation's top 20 media markets (all but Los Angeles). It is available in 83 percent of Pennsylvania's households, by far the lowest percentage of any state in the Big Ten footprint, according to the Big Ten Network.
"We always believed the concept of a Big Ten branded network would be successful," Big Ten Network president Mark Silverman said. "The question was 'How quickly?' And that is what has been most surprising."
Hence, there is expansion talk.
According to industry experts, the Big Ten Network receives between 70-80 cents per month from 17.6 million subscribers within its eight-state footprint, and between 5-10 cents per month from 27.5 million subscribers outside the region.
That's a huge difference between the Big Ten market and those untapped areas. Thus, expansion's goal is to increase the eight-state footprint and hike the number of customers who receive the network as part of their cable service's basic package.
"The Big Ten Network has a vested interest in getting as many cable networks as possible," Ourand said.
Gone are the days when Comcast, Time Warner and other cable networks snubbed the new channel, insisting the BTN be part of a higher-priced sports tier. Now, it is part of the basic cable package in all eight states that comprise the Big Ten's footprint.
By luring Rutgers or even Syracuse and Connecticut, the Big Ten Network can possibly get New York City-based Cablevision, the dominant presence in the No. 1 media market in the nation, to offer the network as part of its basic cable. Rutgers also is 60 miles from Philadelphia, the nation's fourth-largest media market, and has approximately 380,000 living graduates, trailing only Texas (450,000) among the presumed Big Ten list of candidates.
By landing Missouri, the Big Ten's footprint would expand to include St. Louis, the nation's 21st biggest media market, and Kansas City, the 32nd ranked market.
If the 2.2 million households in Missouri started earning the Big Ten Network the 70-cent basic-tier fee rather than the 10-cent out-of-region pay, that would equal potentially an extra $1.5 million per month.
And that's just Missouri.
By contrast, a Big Ten title game in football would raise perhaps $1 million per school, at most, according to industry estimates. The SEC title game, which is much more ingrained since its 1992 inception, made $14.3 million last year for the conference.
The Big Ten footprint already includes Indiana and Chicago, but Notre Dame would offer national appeal and could be a negotiating tool in New York, with its large Roman Catholic and Irish population.
The Fighting Irish also earn enough from their current TV deal with NBC (a reported $15 million per year) that they wouldn't tap into the Big Ten's current slice of the pie.
Texas is a nationally known school in the South that plays in a top-50 media market.
"Where else are they looking to go?" Reynolds said. "Missouri would be a nice addition. It gives them St. Louis. As for Nebraska, Omaha is growing rapidly. It's an up-and-coming market. That's beyond the current province of their footprint."
Delany said he doesn't expect any expansion announcement before late fall. He said there won't be any ruling when the conference presidents, who have the ultimate say, meet June 6 in Park Ridge, Ill.
New York is the one market the network covets, but it might not come aboard with just the addition of Rutgers. Cablevision, that area's largest operator, is a notoriously tough negotiator for basic tier admission, especially with college sports.
"It will be very interesting if Rutgers was invited and became part of the network, how that would play out," Reynolds said. "Not since Chris Mullin was around has college sports been must-see TV in New York."Additional Information:
Here is the closest major designated market area (DMA) for some of the teams being considered for Big Ten Conference expansion:
School -- Nearest City -- DMA rank
Rutgers -- New York -- 1st
Missouri* -- St. Louis -- 21st
Pitt -- Pittsburgh -- 23nd
Connecticut -- Hartford/New Haven -- 30th
Texas -- Austin -- 48th
Nebraska -- Omaha -- 76th
Syracuse -- Syracuse -- 83rd
Notre Dame -- South Bend -- 91st
* Kansas City, which is farther from UM, is 32nd
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