wile_e8

November 20th, 2012 at 6:53 PM ^

 

In other words, as a profit-making mechanism, this is essentially a scam. It relies on an opaque pricing mechanism (bundled cable television) forcing people to pay for a product they don’t want. Right now, it’s a highly lucrative scam. But bundled cable television pricing is not going to last forever, and possibly not very long at all. There is already a revolution in video content under way that is going to render the cable television bundle model obsolete. When that revolution has finished, the Big Ten will realize it pulled apart its entire identity to grab a profit stream that has disappeared.

And here is the key - cable subscription fees won't last forever, and when they are gone we're still going to be stuck with Maryland and Rutgers.

Eck Sentrik

November 20th, 2012 at 7:37 PM ^

{And here is the key - Fiber optic television subscription fees won't last forever, and when they are gone we're still going to be stuck with Toledo and Ball State.} - Posts from 2025

 

I'm pretty confident thus far that the B1G will stay ahead of the curve with the network.

bronxblue

November 20th, 2012 at 11:19 PM ^

Yeah, this was my thinking as well.  Sure, the schools already have built-in fanbases, but people complaining that "just wait until cable isn't relevant anymore" are ignoring the fact that masssive multimedia conglomerates tend to dictate the methods and technologies by which you receive information, even if the customer-facing entity appears to be struggling.  

FreeKarl

November 20th, 2012 at 7:47 PM ^

Bundled cable is not a scam. I don't think people realize how cable tv would cost if everyone was  buying individual channels. Channel's are bundled because they fixed costs(the actual cable infrastructure and cost of producing content) is relatively expensive while the cost of distributing the channel to more people is essentially nonexistent. 

jblaze

November 20th, 2012 at 9:35 PM ^

if cable were not bundled, we would all pay $100/ month for Internet access and then pay $1-$3 per channel. I can assure you that the cable companies, who control internet access (generally via monopolies) are not going to not make a huge profit!

Services like Hulu & Netflix only make live TV more valuable. Sports is the only reason I even have Cable TV.

wile_e8

November 20th, 2012 at 10:23 PM ^

At some point not very far down the road, streaming video over the internet will become ubiquitous to the point that lots of people will drop bundled cable and and only pay for the streaming shows they want. At this point, all of those infrastructure costs will be covered in the internet bill and the individual channels will need to find interested customers willing to pay to cover the costs of producing content. And when this happens, BTN.com will be able to attract a significant number of subscribers from the die hard fans, but more casual fans are going to be discouraged by the number of crappy games from programs that have nothing going for them other than "demographics". Those demographics won't matter when they drop cable and subscribe to streaming video from anywhere other than BTN.com, but those programs are still going to get an equal cut of the BTN.com subscription fees. In the mean time, good luck raising ticket prices with schedules featuring Rutgers and Maryland and whatever other middling programs get added because they have "demographics".

Gulogulo37

November 20th, 2012 at 10:46 PM ^

You say CABLE TV would cost more if everyone were buying individual channels, and you're absolutely right. But isn't the point what it's replaced by? There's already internet infrastructure. It doesn't take anything more to add that content to my internet package, right?

Cable - internet = undesirable, cable can't get me dirty, dirty German porn (insert South Park quote that I'll forego)

Internet - cable = totally fine provided that I have college football and about 2 TV shows I like that aren't on basic channels. And actually one of them isn't even on basic cable; it's on HBO.

I realize most people watch more TV than me, but for myself, buying individual programs or channels is far cheaper than the bloated price of Comcast that my mom pays. Hell, I can watch The Daily Show and South Park online for free. And certainly part of the reason it's free is that it doesn't cost anything extra for them to throw it on the internet.

Edit: Damn! Wile_e8 said everything already. Not sure how it was supposedly posted 20 minutes before me though

FreeKarl

November 20th, 2012 at 11:09 PM ^

The thing is the channels that cover college football, if paid for seperately would probably excede the cost of your current tv bill. You can only watch The Daily Show and South Park for free because millions of other people are paying for it. Jon Stewart isn't working for free with a donated studio and the revenue generated by people watching a few ads online isn't going to cover the costs of producing the show. 

Blue since birth

November 20th, 2012 at 8:07 PM ^

I think all of the predictions about the demise of the cable companies (and the current model) are very premature. I say this after recently looking into dropping my monthly provider and finding it wasn't at all practical for a family of four. Maybe a different story if I were single and kid-free. As sad as it may be... I'm one of the more tech savvy people I know.

turtleboy

November 20th, 2012 at 6:56 PM ^

While I don't necessarily disagree, it's funny how he doesn't deride Notre Dame dropping B1G play to expand ACC and Pac 12 participation for the same reasons, only much more selfishly and greedily. Everybody basically applauded their move, while more is somehow expected of the B1G.

UofM-I-Hart

November 20th, 2012 at 7:20 PM ^

There was a ton of people in which it is their only job amd they get paid well to do all of the research and they must have found it would benefit the B1G

IPFW_Wolverines

November 20th, 2012 at 7:28 PM ^

How about a mod makes one thread for expansion. That way the "end of worlders" can go in there and hold hands or whatever it is that end of worlders do to console themselves, and the rest of us can move on without seeing ten threads saying the same thing.

Tater

November 20th, 2012 at 9:06 PM ^

And this means it can't be in multiple threads because?  You don't want it to be in multiple threads?  There are a lot more people here than just you, and they all have their own opinions and ideas of what is relevant.  

Relevance is determined by participation.  In other words, every time you post about something that you see as redundant, you are actually making it more relevant.  

You don't want my advice, but I'll offer it anyway: it isn't wise to expect everyone on mgoblog to obey you or agree with you just becuase you say it is so.  It also isn't wise to prove the relevance of the very things you want to eliminate.

I hope this helps.

 

LSAClassOf2000

November 20th, 2012 at 7:33 PM ^

"Like the Big 12, the ACC learned that taking a bunch of fan bases that reside in the same general region and declaring that they should start caring passionately about beating each other is not enough to make it happen."

This is one of the things that worries me about this on an admittedly sentimental level. I do understand the money angle, the BTN subscription fees being very attractive in these markets where Rutgers and Maryland reside, the desire expressed by these schools to have solvent athletic departments and the like, but will Rutgers or Maryland ever develop a real rivalry in a relatively insular Big Ten? I see ours as a conference where it might be difficult to invent a rivalry, as there are some long-standing, storied ones. The revenue estimates are enough for the conference that this may not matter, but to some extent, it does to me. Hard to explain precisely. In a decade or two, will we be revisiting this week and wondering what has been gained by the conference in an intangible (i.e., not financial) sense? Part of me fears the answer may be less than thrilling. 

 

eamus_caeruli (not verified)

November 20th, 2012 at 8:53 PM ^

In my mind you make a great point, will they ever be accepted to the degree of Nebraska? In all honesty, ru and mu may get their money but will always be outsiders. If anything people will resent that they are forced to call them BIG schools and they will have a hard time garnering respect. I mean who went to Expedia and started looking at tickets to DC or NJ for our first game against them in two years.

Oh, no one.

I won't get behind them. This isn't me being stubborn, it's me being BIG ethnocentric. I like many want the BIG to stay relevant to me, and where I live. Could careless about peoples cable boxes, even alums --sorry but true! We make a ton of money now as a conference and would have regardless.

Nebraska was a good call. They were not.

Section 1

November 20th, 2012 at 7:54 PM ^

Because I agree 110% with him on all things college football, and I agree with close to 0% of his political writings, which is his basic "day job."  It's actually a wonderful feeling to find agreement with someone who comes from what you normally associate as the opposition.  And he really is a very fine writer, no matter what the sentiment.

In this story, Jon walked right up to the edge of a very large question and then never really dealt with it.  Why, exactly, do colleges continue the need to feel ever more pressed for more money?  Assuredly, every B1G athletic director feels an urgent need to raise more money.  To even do whacky, crazy, extravagant things, to raise more money.  Bring in Maryland and Rutgers and make the Conference 14 teams!  Why?

It's a little like political fundraising, isn't it?  (To pick an analogy close to Chait, without going into a political argument.)  Politicians, most of them, HATE political fundraising but they do it because it is part of the job.  And it is part of the job because it is necessary, to compete.  The competition is regulated, but only partly, and only in certain limited ways.  You can never have too much cash, and you will always find a way to spend it.  The more you have, the better you can compete.  You could place limits on the fundraising and spending, but it isn't easy; when there are separate competing interests, money will usually find a way to do its work.

As always, the interesting comparison is the NFL.  The NFL is almost pure socialism compared to the wild west capitalism of collegiate football.  The owners of NFL franchises are very much geared to the financial success of the league.  The NFL has one contract with apparel vendors, one system of rigid salary capping, one entry draft (with the poor getting richer and the rich getting poorer), and even the schedules get re-jiggered every year so that bad teams don't have to play too many great teams, within the limits of geographical divisions.  Teams share equally in all manner of league revenue, and even the tiniest details from player discipline, to approval as to how uniforms are to be worn, are league prerogatives.  One commissioner, ruling all of the franchises.

Just imagine; the Lions trying to raise donations in order to build better facilities so as to attract a better class of players in 2014.

In the case of trying to expand the revenue base of the Big Ten Network, Michigan is not getting a leg up on Ohio State.  But all of the Big Ten schools might be getting a leg up on Oklahoma, or Tennessee, Syracuse.  Maybe, just maybe, the evil at the root of all of this expansion mania, is the balkanization of tv contracts broken up by leagues and/or teams.  As a consumer, I like the Big Ten Network.  It's fun and interesting.  But when it leads to the destruction of Michigan playing Wisconsin, or the ruination of the final season game against Ohio State, I will have a very hard time supporting the BTN.

FreeKarl

November 20th, 2012 at 7:54 PM ^

I don't think either of those are really good analogies though:

1 Of course politicians hate the act of fundraising, no one likes asking people for money and pretending to like them and care about what they have to say. That doesn't mean they don't like the present of money in the political system.

2 In NCAAF, recruiting players is about having sweet facilities and a broader influence that will help you to be given the benefit of the doubt in polls. In the NFL, player's care a bit about about facilities and desire to play on a winning team, but mostly salary dictates their decision. 

Section 1

November 20th, 2012 at 8:07 PM ^

You've made two good points that illustrate what I was suggesting.

Of course there are politicians -- even incumbents, for whom the status quo usually works pretty good -- who so despise fundraising, that they'd vote to reform it. Meet Senators John McCain and Russ Feingold.  Bipartisan reformers.  But then there are the others who know that what currently exists usually helps get them re-elected, and they fear (and oppose) any change that would upset their position.  Meet Bo Schembechler, who lobbied hard against Title IX legislation, and who complained about the reduction in his number of scholarships.

And yes oh yes NFL players care about the money.  That was partly my point.  They expect a certain basic level of facilities, but beyond that, they make millions and can buy their own trainers and facilities.  The big thing for them is the salary cap, and there you run into NFL socialism once again.

What would Michigan do, if the NCAA set an absolute limit on how big a collegiate football budget can be?  Michigan football makes about $75 million a year, and they spread it out to all of the other sports.  What if the NCAA wanted to make it more even for everybody, to help promote a unified game like the NFL?  Teams could only spend $10 million a year on football operations, and all revenue above a certain level were shared?  Because that is how the NFL works, essentially.

Soulfire21

November 20th, 2012 at 7:51 PM ^

Saban's come out in support of superconferences, and with conferences reaching 14 teams (and possibly 16 soon), does this mean we're going to play more than 12 regular season games?

Is that even on the table?  Like a 16 game model?

UMRecruitingFannatic

November 20th, 2012 at 7:59 PM ^

Play the majority of the games in the fall semester, then move the finale of the season to the spring term with Bowl games being played after?  That way we could get northern bowls and more reason for households to get the BTN.  Plus more ticket sales, more time to practice, etc. 

Geary_maize

November 20th, 2012 at 8:06 PM ^

Lots of faulty logic here

1) Cable might become obsolete: Yes, but it doesn't change the fact that the two schools are the dominant in state institutions of populous states. Whatever medium media morphs into in the future, that is a built in advantage that cannot be replicated by, say, Pitt, Syracuse, or NC State

2) B1G will fail like the B12 failed: WTF? The B12 failed because Texas acted like a spoiled ahole and the B12 payouts were pitiful. In case you haven't noticed, the B1G is equal, and the payouts are peerless.

3) B1G will fail like the ACC: The ACC is a hugely flawed conference to begin with. 4 schools in North Carolina? Are you kidding me? A basketball league in a land driven by football? And Rutgers/Maryland >>>> Pitt/Syracuse long term.

4) At some point you don't need more money: Tell that to the SEC. Long term the B1G's rival is them, and they ain't slowing down, especially with the SEC network coming soon. Facilities need constant updating, coaches pays get higher, and Michigan will build a new hockey arena sooner or later.

He is right though, in that the tradition loss is sad. 

Section 1

November 20th, 2012 at 8:12 PM ^

I just finished saying that I agreed with Chait, but these are great points.  +1.

I guess that I don't much care whether this is a financially winning strategy or not.  I just want my game-day experience preserved, and I am nearing my personal limit on how much I will allow the University to continue to pick my pocket for more money in the future.

Geary_maize

November 20th, 2012 at 8:39 PM ^

Tradition loss is sad. I just hope that Rutgers and Maryland will be able to take advantage of their in-state talent (which dwarfs schools like Iowa, Minny, Wisky, Indiana) and B1G resources to become consistantly ranked teams when they come to the Big House.

And with the newcomers raking in 2x or even 3x the money of the Big East or ACC schools around them, it seems like a matter of time.

Section 1

November 20th, 2012 at 8:22 PM ^

Do you mean more rowers, gymnasts and field hockey players?  Because scholarships in revenue sports are strictly limited.  Michigan can't give out more "free educations" for partaking in football if they wanted.

There is a name for what is happening in FBS-level college football.  It is called "an arms race."

FreeKarl

November 20th, 2012 at 8:31 PM ^

Yes that is what I mean, and scholarships are limited in those sports also so I'm not sure why that was pointed out. If it was a football arms race why would Michigan be spending 200 million dollars on non-revenue sports?

FreeKarl

November 20th, 2012 at 8:48 PM ^

Yeah but the renovations were to increase revenue and give more people the opportunity to watch football, not in the spirit of some sort of competitive advantage. Additionally, a 56 million dollar facility for 100+ athletes is a similar level of spending to a 40 million dollar indoor rowing facility for a team of around 50 athletes. 

Geary_maize

November 20th, 2012 at 8:43 PM ^

When Alabama hired Nick Saban for 5 million a year, I realized it was going to take money to win.

And not just money, but the MOST money. 

College sports is going the way of baseball. The Yankees usually win.

Just sayin.

Geary_maize

November 20th, 2012 at 8:55 PM ^

They are the dominant, peerless in-state schools in a populous, talent rich state. Once they update their facilities and hire better coaches with the B1G money, there is a good chance they will become pretty decent football teams. They have much better built in advantages than Iowa, Northwestern, Minnesota, Wisconsin, Indiana, Purdue, Michigan State, and dare I say... Nebraska.

The even better thing is those Jersey and Maryland recruits will come to the B1G in bigger numbers. Just look at the talent the past 2 years.

Henri Poggi, Steffon Diggs, Kendall Fuller, Eli Woodard, Yuri Wright, Darius Hamilton, Devin Fuller, Ronald Darby, Cyrus Kouandjio, Blake Countess

Pitt will always be second fiddle to Penn State for recruits. Syracuse is a small private school in a less than talented state.

And Rutgers brings in New Jersey cable money, and Maryland brings in Maryland cable money. Neither Pitt or Syracuse does.

justingoblue

November 21st, 2012 at 10:38 AM ^

but it's still very much of an uphill battle against PSU. Of the guys you named, Paterno wanted Fitzgerald to play LB, McCoy was a huge in-state recruit but committed to Miami before ending up at a prep school after problems in high school, Pitt picked him up after that. I don't know the story regarding Otah's recruiting, and Revis was a legit win, although aided by his desire to play basketball as well.

I'd say Pitt/PSU is much more equal than M/MSU, OSU/Cincinnati, or USC/UCLA, but it's still something like UT/A&M. At least under Paterno, PSU won a lot more recruiting battles than they lost; we'll have to see with O'Brien and Chryst.

VSS

November 20th, 2012 at 7:57 PM ^

I completely agree with Chait. But, the only reason I support this expansion is because they're large flagship universities in densely populated and wealthy states with good academics and the potential for much better athletics as well. As crazy as these expansions are becoming, I'm almost of the mindset that we should go after the best schools no matter where they are, but I can understand the "upside" argument with this deal. Where I especially agree with Chait is with whether framing the issue in these terms as if it's a game of Risk is right. I don't think it's right at all. I think as far as the business model is concerned, I think we should be able to adjust. I don't see us going to a-la-carte cable or the content providers relinquishing their bargaining power anytime soon, but the cable business will be much different 10 years from now. 

Geary_maize

November 20th, 2012 at 8:59 PM ^

South Carolina was nothing a decade ago. But recently, with the SEC money really kicking in around the late 90's, they made a good coaching hire, and boom look at where they are.

But it takes more than money. You need recruits, preferrably in-state recruits. Where is Marcus Lattimore from? Where is Jadaveon Clowney from? South Carolina.

Maryland and New Jersey suck right now, but I don't see why they can't become the next South Carolina.

ppToilet

November 20th, 2012 at 7:58 PM ^

My favorite line:

What’s amazing about the college conference expansion fad is that the conferences are not even doing the normal dumb thing that every business does, which is to try to copy success. They are trying to copy failure. Everybody is racing to turn their successful product into the next New Coke.

ppToilet

November 20th, 2012 at 8:03 PM ^

I think he is saying that you can't manufacture tradition. That just because you make something sweeter, and just because people generally like sweeter things, doesn't mean the "new" product is better than the old one.

Geary_maize

November 20th, 2012 at 8:10 PM ^

You can't manufacture it... if you mistreat your own conferencemates. Texas drove off Nebraska, and the ACC simply could not supply the financial support it should have.

Given the B1G's rock solid status, I don't see why another 40 years down the line we won't have more rivalries.