Pac-12 survival: Downside risks, potential benefits, missing pieces tied to an Apple deal

Pac-12 commissioner George Kliavkoff presented a media rights contract to the schools on Tuesday, with nothing less than the future of the century-old conference at stake.

Details are sparse as the presidents and athletic directors digest the proposal, save for an ESPN report indicating Kliavkoff’s plan featured a heavy presence on Apple and a revenue structure that tied cash to subscriptions. Our reaction ...

1. Any chance to link arms with the richest, most influential, most innovative, savviest, smartest company in the world is something the Pac-12 should seriously consider, especially when that company is rapidly expanding its portfolio of sports properties

2. The lean into streaming comes as no surprise. Kliavkoff signaled his strategy 18 months ago, telling a sports media podcast: “Whatever deal we do, it’s my goal to have our content available on any piece of glass connected to the internet. Period, full stop.”

Six months later, he indicated the conference’s next media rights deal was “highly likely” to feature a major digital media company.

3. At the same time, the Hotline viewed any media rights deal that didn’t include a package of games on ESPN as a suboptimal approach.

ESPN is vital because of the product visibility provided by linear television and the network’s messaging power within the college sports space.

If the Pac-12 isn’t contractually tied to ESPN, then its highly-influential studio shows have little motivation to discuss the conference and promote its teams and players.

4. Which brings us to a critical point in this assessment: The unknown elements of the deal Kliavkoff presented.

Is the proposed contract only with Apple? Or is there a separate linear TV component? Did Apple commit to sub-licensing games on ESPN or another network? What other deals are under consideration, if any?

5. Within the Apple piece alone, there are myriad unknowns.

How much revenue is guaranteed per year? How easily reached are any subscription-based incentives? How would Pac-12 content be viewed on Apple products and, of course, what’s the cost?

6. Another question: To what extent will Apple throw its immense marketing power behind the Pac-12?

7. How would the football schedule work, particularly the kickoff times?

Traditional broadcast windows do not exist on streaming platforms. Would there be a weekly selection process, or could the Pac-12 set the start times weeks (perhaps months) in advance?

Would there be a need for Thursday or Friday games? Could each team play every home game at 1 p.m. or 4 p.m. if so desired?

8. How would an Apple deal impact recruiting?

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Yes, the prospects want to perform on the sport’s biggest stages — that’s one reason the Hotline has always viewed ESPN as a critical piece to any contract.

That said, recruiting is increasingly driven by NIL opportunities, which aren’t connected to ESPN, and the transfer portal, where prospects seeking a second chance prioritize playing time and skill development.

9. The conference plans to expand — it needs a 10th team in time for the 2024 football season. Will the targets change with a media contract that connects revenue to streaming subscriptions?

If the size of the fan base matters more than the size of the media market, perhaps San Diego State (undergraduate enrollment: 31,000) is more advantageous than SMU (7,000).

Perhaps the conference would reconsider the merits of large schools with passionate followings, like Fresno State and Boise State, that have not been on the expansion radar.

Add this item to the lengthy list of unknowns.

10. Kliavkoff’s strategy also focused on limiting the duration of the contract. Specifically, he wanted a deal that expired before the new Big Ten (2030) and Big 12 (2031) contracts, thus giving the Pac-12 a chance to gorge at the media cash trough before its competition.

Within that approach is a vital calculation for the university presidents to consider: The next contract.

Yep, the schools are already (and smartly) thinking about what comes next. How would a contract cycle that begins in the summer of 2024 position the Pac-12 for a deal that starts in the summer of 2029?

We know ESPN will become available on a direct-to-consumer basis in a few years, the company is seeking a strategic partner and Apple is a prime candidate for that role.

What might that mean for the Pac-12 in Year One of an agreement with Apple, and what would it mean for Years Three and Five?

Should the Pac-12 prioritize a close relationship with Apple above all else, including revenue?

Is the best comparison not the MLS Season Pass on Apple TV+ but, rather, the Big East’s marriage to ESPN in the early 1980s, when the network was on the verge of domination?

Those are the strategic issues the Pac-12 schools should consider.

This much is clear: The future of the conference is at stake. Colorado just left for the Big 12, and Arizona could very well be next. That might force Arizona State to leave, sparking the swift extinction of the Pac-12 as we know it.

Is the Apple deal good enough to save it?