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Uneven ACC Revenue Distribution is a Start, Move to Big 12 Should be the Finish

Clemson AD Graham Neff is urging the ACC to distribute revenue more fairly. They should, but that probably won’t be enough to keep the ACC afloat until their next TV deal.

Syndication: The Greenville News Ken Ruinard / staff, Ken Ruinard / USA TODAY NETWORK

For the past several months, ACC fans have had to hear all about the Big Ten and SEC’s lucrative new TV deals and incoming big brand programs. Additionally, they’ve watched as the Big 12 added the best remaining Group of Five programs (UCF, Cincinnati, Houston, and BYU). Meanwhile, the ACC has stood pat. Now, the two most important programs in the ACC, Florida State and Clemson, are saying aloud what their fans have been thinking for a while, change must happen – and soon.

Florida State Athletic Director Michael Alford said: “Something has to change because we cannot compete nationally being $30 million behind every year. It’s not one year. We’re talking about $30 million compounded year after year.”

Clemson Athletic Director Graham Neff suggested they should begin distributing the conference’s TV revenue based on the value each program creates rather than simply giving each school one-fourteenth of their $240 million per year deal.

Is it time revenue distribution within conferences, or at least the ACC, is done differently? Yeah, I’ve been very active in those conversations within the league and continue to expect to take a leadership role in our desire for that to be a changed circumstance. Urgently.”

How would an uneven distribution work? Here’s one possible model for dividing the $240 million pie. Currently divided 14 ways, each school receives $17.1 million annually. When looking for an alternative way to allocate those funds, I believe there are three factors that should be considered. First is a fixed pay-out. While Clemson and Florida State want more of the pie, there is also an interest in competitive balance and membership. It cannot be completely based on metrics. Every member must be guaranteed something. Let’s call that one-third of the pie. That comes to $5.7 million per school – a lot less than the $17.1 million they’re currently guaranteed.

The next consideration is purely merit based: ACC football wins. Over the past four seasons, Clemson has 13% of all the ACC wins while Syracuse and Duke each only have 5%. There should be a reward for putting forth a good product. Furthermore, this makes every single conference game especially meaningful as money to help build the program is always on the line. For simplicity, let’s call this another one-third of the pie. Clemson would get 13% of this slice of the pie or roughly $10 million dollars.

Finally, TV ratings must be included. They are the engine that powers the ship after all. On the one hand, this is unfair because a bad Florida State or North Carolina squad may still draw better ratings than ACC Championship-level Wake Forest or Pittsburgh teams. On the other hand, what could be more fair than paying schools directly for the eye balls and thus dollars they contribute to the TV contract? Without delving into TV ratings for every Clemson game on the ESPN family of networks, let’s say it mirrors the 13% of ACC wins and thus Clemson would collect another $10 million from this slice of the pie.

When you add those up, it gets Clemson to an annual TV deal pay-out of $25.3 million dollars. That’s certainly better than the $17.1 they receive now and a step in the right direction. Graham Neff makes a great point about this being an urgent need and it is something the ACC should do as soon as possible.

That said, this is merely a band-aid solution. The Big Ten’s new TV deal is set to pay members $72 million dollars each. The new SEC deal will pay members $51 million. Even if unequal revenue sharing increases Clemson’s allocation from the ACC to approximately $25 million, they’d still be making half of what SEC rival South Carolina collects. Can they sit back and be okay with that?

Keeping the ACC together and workable is in all members’ best interest as the new 12-team playoff grants an automatic bid to conference champions and a bye for the top four ranked champs. Winning the ACC is certainly easier than winning the SEC or Big Ten, something that would become even more difficult if the ACC’s top teams were to join.

Nevertheless, money is needed for recruiting budgets, facilities, securing the best coaching staffs, and potentially one day paying athletes. Clemson and Florida State likely won’t trade falling that far behind financially for an easier path in the new 12-team playoff format.

Joining the SEC, which seems most obvious, is highly limited by the ACC’s Grant of Rights agreement. It “grants the rights” of the member schools’ TV property to the conference through 2036. The SEC wouldn’t want to absorb that many members as there are only a few that would boost their already sky high per team revenue.

Perhaps ESPN, which has a vested interest in keeping the ACC around for the ACC network, would adjust the deal to make it more viable. Of course, counting on ESPN to do what’s best for the sport and their long-term interests rather than taking the quick dollar is probably wishful thinking.

Instead, one idea that has not been discussed much is the Big 12 absorbing eight ACC schools. I have not heard any inside rumors of this, but it could serve as a major win-win. If a majority of the ACC schools leave, the Grant of Rights would no longer apply. This would allow those schools to escape their bad TV contract. The Big 12 TV contract ends after 2025 and this move could massively boost their own upcoming TV contact.

Imagine if the Big 12 added: Clemson, Florida State, Miami, Georgia Tech, North Carolina, Duke, Virginia Tech, and Louisville. The conference would stretch wide – from Utah to Virginia – but new members would fit nicely within the boundaries of their current members. Geographically, it actually looks mostly cohesive.

It would be far more difficult for Clemson to win this proposed 20-team super conference and earn the CFP auto-bid than in the current ACC, but games would be more entertaining and draw more national interest. Obviously, this would immensely hurt the ACC schools left behind like Boston College, but they can’t expect major brands to subsidize them any longer, at least not when those brands can no longer afford it. I dive in a bit deeper into this possibility in the video below:

Recently, several reporters close to the program have suggested that the Big Ten could come calling for both Clemson and Florida State. Unfortunately, their hesitance to add Oregon and Washington makes me question if they’d be interested in taking a big enough chunk of the ACC to void the Grant of Right deal. If the SEC joined them in the raid, the two could perhaps pick it apart. Florida and South Carolina may be loud enough to block Florida State and Clemson from joining the SEC which could result in them joining the Big Ten.

It is impossible to predict what will happen except that the status quo will likely change again. Hopefully when the dust settles, Clemson finds themselves still playing key rivals like Florida State, Georgia Tech, NC State, and South Carolina and not taking too many trips to far-off locales like Minnesota, Illinois, and Los Angeles.