DirecTV Expects to Offer SEC Network Soon
The SEC Network is set for one of the most successful sports network launches in history now that DirecTV, the nation's largest satellite company, emailed Outkick that the company is "quite hopeful" and "expects to be able to provide the network soon." The public comments of DirecTV square with the private comments of SEC and ESPN executives, who are confident that a deal is near as well. DirecTV, which has over twenty million satellite subscribers, carries the Big Ten Network, but does not carry the Pac 12 Network The satellite company has, at times, engaged in contentious negotiations with content providers in an effort to keep costs lower. Its primary competitor in the satellite arena, Dish Network, became the first national satellite company to sign on for the network several months ago.
DirecTV's negotiations with the SEC Network are part of a larger negotiation with the other ESPN networks, and while it is unclear exactly when those deals will all be finalized, it's a significant pick-up for the SEC Network and SEC fans across the country, especially for those fans who hadn't wanted to go through the hassle of changing providers. In conjunction with Outkick's previous report that Comcast and the SEC Network are near an agreement, this would mean that every major cable and satellite company -- excluding Time Warner, which has remained fairly quiet so far -- would carry the SEC Network, allowing ESPN and the SEC to hit their goal of roughly 75 million cable and satellite subscribers at launch.
At 75 million subscribers, the SEC Network, which reportedly sought $1.30 a month per subscriber in the 11 state SEC footprint and .25 cents per subscriber outside the SEC states, is poised to do revenue of $369.6 million off the 28 million cable and satellite households in the SEC states. (That's assuming the network ended up averaging $1.10 per month in those households, roughly 20% less than the reported asking price.) Toss in an additional $141 million from the other 47 million cable and satellite households from outside SEC states, and you're talking about $510.6 million in revenue. Add in a quarter more in advertising revenue -- roughly the same percentages as ESPN receives -- and you get an additional $127.65 million. That's a total of $638.25 million.
While there will doubtless be launch and programming costs and we don't know the exact breakdown of the revenue share between the SEC and ESPN, Outkick has been operating on the assumption that both sides will split the money evenly. Given that the colleges don't have to pay taxes on their TV revenue, we're talking about roughly $319.25 million for the SEC, or in the neighborhood of $20 million a school. Combine that with the $20 million that the SEC already distributes to member institutions and you're talking about $40 million or more in television revenue in the near future, half of which will come from the SEC Network.
That's all before the rates begin to rise. (Many popular regional sports networks cost $3 or $4 a year. The SEC Network's ratings will dwarf stations that cost three or four times what it does). The SEC and ESPN gambled that SEC fans would demand that every major cable and satellite subscriber carry their network. Baseball may not be a featured sport in terms of driving fan interest, but with DirecTV on board the SEC Network is officially a home run, poised to become one of the most successful sports network launches in history.