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There is so much happening in the world of sports right now: the Super Bowl, IT, Hockey All-Stars, Blake Griffin, the LaVar Ball of College Football and Hot Stoves.
Thanks to a recent #WOOF and another MBB win, there is even UW news to digest.
But the apple of my eye in the sports media world today is the plight of the PAC 12 Networks.
Source: struggling @Pac12Network informs staff of cost-cutting, restructuring plan, (moves incld elimination of several positions)
— Jon Wilner (@wilnerhotline) January 23, 2018
My opinions on the strategy and execution about the PAC 12 Networks have been well documented on this site over the course of several editorials.
(The PAC 12 Network vis-a-vis layoffs at the Worldwide Leader - 2017)
(Pac-12’s new cable deal - 2016)
(The one where I worked the word “incognizable” into the article - 2015)
(PAC 12 Network following the SEC deal with DirecTV - 2013)
(This was fun - a letter from the PAC 12 to fans in 2012)
In short, I always liked the idea of outright ownership but hated the strategy that saw Larry Scott try to strong-arm DirecTV into a deal that mirrored the kinds of economics that he had won from the regional-based deals that he worked out with some of the cable companies. This in spite of the fact that a national deal with DirecTV held intrinsically far more value than similar deals he worked out with the likes of Comcast and Cox.
But a land grab for money coupled with a misjudgment of the bargaining position he held against DirecTV (now owned by AT&T) has boxed Larry Scott and his PAC 12 in. If he were to cut costs by shutting down the PAC 12 regional networks, he’d be forced to renegotiate his distribution deals with his carriers given that he would have less content to offer. If he tries to negotiate a deal with DirecTV at a lower price, he’d be forced to renegotiate his carrier deals given whatever guaranteed low pricing he’s already granted his current partners.
Checkmate, Larry.
The wheels are not falling off of the PAC 12 Network. There is still much value contained within the enterprise. The full-ownership strategy still creates potentially powerful options for the PAC 12 in a “cord-cutting” and increasingly global marketplace. However, the entity is already on its third president in its four-year tenure and now faces the prospect of a restructuring. There are hard decisions to make and hard times ahead.
In the short term, there may also be no choice. Larry Scott and his media team will be forced into some difficult choices. Those could include holding back more premium content for the P12N to try to force up his value with distributors (at the expense of his deals with the likes of Fox Sports and ESPN) or, more likely, hitting the reset button on his distributor deals to include new pricing attractive enough to bring AT&T/DirecTV to the table.
Check out Jon Wilner’s mailbag where he captures many of his thoughts on the current P12N situation.
All right, on to some dots.
- It’s all about livin’ the dream if you are Mike Hopkins and the Washington Men’s Basketball team.
- Larry Stone says that the Dawgs are arriving “ahead of schedule.”
- Whatever that schedule looks like, rest assured that the new Pac-12 basketball task force will have something to say about it.
- Looking for some football offseason drama? SI ponders whether or not there is a path to the playoffs for the Pac-12.
- New Husky commit, RB Cameron Davis, could turn out to be a “national recruit” before all is said and done.
- The Lady Dawgs had a hard time with the Women of Troy.
That’s it, Dawg fans. Sorry for the late dots today. Life, you know?