Grant of rights deal ACC's bid to secure future
APR 22, 2013 3:47p ET
Swofford has stealthily pulled off two of the biggest expansion coups in the last few years, adding Pittsburgh and Syracuse in 2011, then Notre Dame and Louisville late last year. And he did all of that in ninja-like fashion: quickly and quietly, and before anyone noticed.
If those moves weren’t enough to solidify the ACC’s future in a turbulent conference landscape, the ACC’s latest announcement just might be. As "The David Glenn Show" first reported, the ACC has signed a grant of media rights agreement through 2026-27.
“This announcement further highlights the continued solidarity and commitment by our member institutions,” Swofford said in a release. “The Council of Presidents has shown tremendous leadership in insuring the ACC is extremely well positioned with unlimited potential.”
The Council of Presidents added a collective statement in the aforementioned release: “The ACC has long been a leader in intercollegiate athletics, both academically and athletically. Collectively, we all agree the grant of rights further positions the ACC and its current and future member schools as one of the nation's premier conferences.”
Translation: if a school leaves the ACC before 2026-27 (which is when the league’s ESPN contract runs out), the ACC would retain that school’s media rights, which include media revenue. The ESPN deal alone is worth about $17 million per school per year.
The vote among the 15 member schools — both current and future — was unanimous (which it has to be to ratify a grant of rights agreement). Three other major conferences — the Big Ten, Pac-12 and the Big 12 — already have a grant of rights agreement. (The SEC has neither a grant of rights agreement nor an exit fee. Of course, can anyone think of a good reason an SEC school would leave? I’ll wait.)
Now, what does this mean from a legal standpoint? Who knows?
Maryland is still fighting its $52 million exit fee in court. In September 2012, the ACC approved an exit fee increase from $20 million to three times the annual operating budget (just after adding Notre Dame). Maryland and Florida State were the only two schools to vote against that increase.
Maryland announced it would leave the ACC for the Big Ten just a few months later, and since then? Well, let’s just say lawsuits have been exchanged. The ACC wants to make sure Maryland pays, while Maryland wants to make sure it pays as little as possible, if anything.
The grant of rights agreement essentially replaces the exit fee. If a school leaves, it wouldn’t be paying an exit fee. It would, in theory, just allow the ACC to retain all of said school’s media revenues. More importantly, though, it would ensure that neither the school itself (nor whatever hypothetical conference it moved to) would benefit financially.
The consensus seems to be that this agreement stops realignment rumors once and for all. It will certainly add some stability to the ACC, obviously. And it will make a decision to leave the league a lot more difficult.
But as Maryland’s willingness to leave the league even though it knew about the $50 million exit fee shows, if a school wants to leave badly enough, it will. The ACC will likely continue to fight to get the entire exit fee from Maryland, though. Even though that fee no longer exists, the ACC needs to show the other member institutions that it will not hesitate to back down from a legal battle in the event a school tries to leave.
The recent additions of Notre Dame (as a partial football member, full in all other sports) and Louisville have done plenty to solidify the strength of the ACC, particularly as rumors were beginning to start again over which other schools might bolt for the Big Ten.
The fact that every member institution voted to ratify this agreement is perhaps the best indication that the ACC in its current form is very solid. But time will tell if the agreement itself is too.
+ SHOW COMMENTS +