ACC's New Revenue Model: Will It Save the Conference?

Has the ACC figured out a way to keep the league together? The board of directors have endorsed a new model, but what does it mean?

The board has endorsed a new revenue distribution model based on postseason performance. The “success incentives” will allocate a larger share of revenue from the revenue-generating postseason competitions to participating teams. So, basically, teams that make the College Football Playoff or the NCAA Tournament are going to make more money in this situation.

Now, all other revenues, including from the current television contract, will continue to be shared equally among all ACC members. Gotta keep things fair, I suppose - right?

The ACC has been discussing this new revenue distribution plan for a while, to address the anticipated revenue gap between the conference and the SEC and Big Ten, which some estimate could be as much as $30M per year in the future. ACC schools could be looking at being over $360M behind each school in those conferences at the end of the ACC / ESPN deal, which runs through 2036. Those are mindblowing numbers.

Truth be told - This is a bandaid. They’re hoping the revenue from the new CFP deal will get their bigger brands closer to matching the SEC and Big Ten and keep them from trying to break up the conference and the grant of rights?. But what happens if Wake Forest or Pitt wins the conference, like we saw in 2021? What happens when Clemson or Florida State doesn’t win the conference again, even though they’re clearly the biggest TV draws in football? We’ll be right back in the same situation.

The problem with the new revenue distribution model is that it still won’t make up the difference. Per the story at ESPN, making the College Football Playoff could potentially add over $10 million in annual revenue for a team under the success incentives plan. Most likely, it’ll be somewhere between $5M and $7M, unless the next CFP deal is worth SIGNIFICANTLY more per participant.

This is a dead conference walking. Right now, that Grant of Rights appears to be ironclad… but remember, we saw Texas and Oklahoma announce for the SEC in 2020 when they couldn’t join until 2025… it cost them $100M combined to leave the Big 12 a year early. Once we get into the early 2030s - which is not as far away as it feels - you’ll see somebody announce that they’re leaving. What a weird college football world we’re living in.

From the Friday 5/26/23 full show: https://youtube.com/live/hI75KVbtNds

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