What does the ACC get by adding Stanford, Cal and SMU?

On the surface, potential moves by Stanford, California and SMU to the ACC make little sense for the league, which of course means – in this upside-down world of modern college athletics – it’s probably an inevitability.

“Renewed optimism” were the buzzwords among ACC stakeholders Wednesday evening, signaling that the league may ultimately vote to invite the three schools – or a combination of the trio – sources confirmed to On3.

“It feels different now,” one longtime ACC administrator said. “It feels like this will happen.”

Nothing has been decided. And the league had been, and may for the moment still be, at an impasse, with four schools – Florida State, Clemson, North Carolina State and North Carolina – opposing at least adding Stanford and Cal. If one vote flips, expansion is on.

What is giving expansion proponents hope now is a financial model that could make the additions mutually beneficial. Stanford, Cal and SMU are willing to play the long game in order to gain entry into a Power 5 conference and best position themselves for long-term viability.

‘They’d crawl over glass to get into a Power 5 league,” one industry source told On3.

Yahoo! Sports‘ Ross Dellenger reported that the Bay Area schools are willing to take an initial roughly 30% revenue share, while SMU is willing to forgo any revenue distribution for up to seven years. (History has shown that the Mustangs are awash in enough deep-pocketed donors to offset the revenue hit.)

That would yield a financial boon of roughly $72 million in annual additional revenue for the ACC; existing members would benefit financially, likely in the form of some performance-based incentives.

Time to ‘turn off the lights’ on the Pac-12?

A decision is expected before college football begins in earnest in a little more than a week. The ripple effects of an ACC West Coast recruiting coup would be significant on several fronts:

Most importantly, it would serve as the death knell for the Pac-12. We’re not talking the death of the Pac-12 as we know it. We’re talking the death of the 108-year-old conference – period.

As retired Fox Sports Networks President Bob Thompson tweeted: “Oregon State and Washington State will split whatever [dollars] are left in the checking account and turn off the lights.”

OSU and WSU, both of which lack a marquee brand name in the coveted TV market, would still need a home. Both the Mountain West Conference and American Athletic Conference would accept them with open arms, sources in both leagues told On3. The MWC pays some $6 million annually to members, while the AAC pays a little more than $8 million.

After deliberating for weeks, fielding calls from U.S. dignitaries and weighing both dollars and sense, the ACC would establish a West Coast outpost, a presence in Texas and hope to secure its survival in a world with dwindling super conferences.

In the three-dimensional chess world of conference realignment, this would represent a big move by the ACC.

But there remains doubt whether this is the right move. 

As the tectonic plates continue to shift, with moves driven wholly by TV rights revenue, numerous industry sources, including some with deep ACC ties, question whether West Coast expansion would be beneficial enough for the historic ACC to offset challenges.

“It does not make sense to me,” a veteran TV source told On3.

ACC an example of today’s college sports world

The ACC’s quandary provides a window into the modern, complex world of college athletics. The league is splintered, with at least a handful of schools, led by vocal Florida State, eying more lucrative footing elsewhere. And amid a fast-evolving time in the media world, with cross-currents reshaping the rights landscape, there is no quick fix: The ACC’s rights deal with ESPN extends to 2036.

It’s a poach or be poached college sports ecosystem.

Failing to make a move could, in time, pose an existential threat to survival.

“There is no question that the conferences compete against each other,” Tom McMillen, CEO of LEAD1 Association, told On3 on Wednesday, not speaking specifically about the ACC’s decisions. “They are vicious. They’ll look for any angle to get ahead of the others, even when working together might be in the best interest of college sports. There is a fragmentation where dog-eat-dog is the prevailing culture.”

It remains to be seen how much adding the Bay Area schools would address the league’s clear and present pain points. In fact, the move could create new ones.

New ACC would have ‘insane’ travel for teams

There’s no guarantee expansion would allay concerns emerging from Tallahassee, where disgruntled Florida State leadership in recent weeks has been pounding the table and threatening to exit the league.

The blustery rhetoric centers on believing FSU deserves more TV rights revenue because of its brand name. The revenue gap between the ACC and the industry’s two heavyweights, the SEC and Big Ten Conference, is likely to expand to more than $30 million annually in the coming years.

Secondly, travel logistics and related costs create daunting challenges. The two westernmost schools in the ACC are located in South Bend, Indiana – Notre Dame competes in the ACC in all sports except football – and Louisville, Kentucky. The league would now stretch from Boston to Miami and some 3,000 miles away to the Bay Area.

“Travel would be insane,” one source said. 

Travel concerns that have come to the forefront in the new coast-to-coast Big Ten would apply to the ACC as well.

“How can you tell a player at USC that signed a year or two ago, ‘You can’t transfer without penalty’?” Jay Bilas, the ESPN analyst, told On3 on Wednesday. “You just materially changed that player’s life. Now their road trips include Rutgers. And maybe they went to USC saying, or UCLA saying, ‘I went there so my parents could see me play.’ They can make a road trip to Stanford. They can’t make a road trip to Rutgers.”

What do Stanford, Cal bring to the table?

Lastly, to be clear, Cal and Stanford are both exemplary academic institutions.

Stanford arguably offers the best combination of academics and athletics nationwide, dominates the Directors’ Cup and is awash in world-class athletes who compete in a multitude of sports. Stanford also has a $36.2 billion endowment.

But TV sources had initially cautioned that the Cardinal wouldn’t grow the league’s revenue pie enough to warrant inclusion.

“It won’t make a difference,” one veteran source familiar with the discussions said.

Another: “ESPN controls the ACC. Why does ESPN want to ante up more money to make that happen? If they were to ante up more money, existing schools like Florida State would want more first.”

There is a pro-rata clause in the ACC’s ESPN contract, according to Yahoo! Sports, which stipulates that the financial value of the deal increases accordingly if the league adds new members. But TV sources have long said that the Bay Area is not a market that is coveted as much as several others nationwide. 

Neal Pilson, the longtime former CBS Sports president, recently told On3: “I don’t think either or both Cal and Stanford add sufficient value to an ACC TV package to induce the conference or ESPN to add them to the agreement. The travel costs to the two schools for football, basketball and multiple Olympic sports would be prohibitive. Makes more sense for the four remaining Pac-10 teams (including Oregon State and Washington State) to join the Mountain West, improve its value for TV and perhaps change the conference name back to the Pac-12 (or 14).”

Stanford, Cal face desperate times

The ACC took an informal straw poll earlier and fell one vote shy. One longtime college administrator called it a “reality check” for the league, considering the severity of challenges associated with the moves.

The ACC needs 12 of 15 schools to approve the expansion. Notre Dame has been strident in its belief that adding Stanford and Cal would benefit the league.

For Stanford and Cal, these are desperate times. If the ACC passed, their options to join a Power 5 conference for 2024 would be all but gone, especially with the Big Ten signaling it is done expanding for the time being. Condoleezza Rice, a Stanford professor and former U.S. Secretary of State, has reportedly called the ACC on Stanford’s behalf. (Former President George W. Bush has done the same on SMU’s behalf.)

A key element has been if the ACC additions could take enough of a cut in initial annual revenue shares that the amount of additional ESPN money secured from expansion could be divvied out among current league members. While an attractive strategy in theory, Florida State still has been pushing for uneven revenue shares of TV rights dollars to benefit the biggest league brands of best on-field performers.

When the dust (finally) settles and a formal ACC vote is taken, all parties may get their wish, for better or worse.

As Nebraska Athletic Director Trev Alberts told The Lincoln Journal Star: “History is unkind to conferences that have not had the courage to expand.”