Dear Fellow Tigers,
It has certainly been a challenging few days since we communicated with you last Friday. During that time, the future of the Big 12 Conference came into serious question. The potential implications on the University of Missouri and the entire region, were very much up in the air. At that time, we wrote to you to answer what we could, and to ask for everyone's patience while we worked to solidify our situation.
As you know, yesterday was a big day for Mizzou and the entire Big 12 Conference. It was announced that 10 members have agreed to stay together and move forward. Moving forward is the tone we want to take today.
Yesterday was a very positive development for the University of Missouri, for Mizzou Athletics, for our student-athletes, and for our fans and alumni. The Big 12 Conference, already one of the top conferences in the nation, has positioned itself to become even stronger with 10 members.
As we have heard from our media partners, our collective value has not only increased as 10, but has made us more attractive from a number of standpoints, including:
- Continue to strengthen our academic partnerships with our schools in the Big 12
- Stronger financially
- Benefits our fans – preserving rivalries and regional presence
- Benefits our student-athletes
- More attractive to prospective student-athletes
- More attractive to recruiting/retaining media partners
The uncertainty of the last few weeks, and all the speculation thrown around in the media has led to a lot of misinformation. While it would be nearly impossible to answer each question individually, we wanted to let our fans know their voices and concerns have been heard. We have attempted to address the most frequent questions we've heard in the following Q&A.
We are hopeful that the dialogue below helps answer some of the most pressing questions that you have asked. As we know, getting all of our questions answered will be a lengthy process, and we will continue to communicate with you as policies within the new Big 12 Conference take shape in the future.
Thank you for your support,
Mike Alden
Director of Athletics
Mike Alden Q&A Session
Q: There are reports that Missouri, Baylor, Iowa State, Kansas and Kansas State agreed to financially assist in retaining all members of the Big 12. Is this true, and if so, why would we agree to such a thing?
A: There has been a lot of confusion on this particular issue. Our five schools approached the Big 12 Conference offices, offering to assist in assuring the retention of all 10 members of our league. We knew from Dan Beebe, our Commissioner that Texas, Oklahoma and Texas A&M were offered opportunities in other leagues. We wanted to assure the Commissioner that if the five of us could help, we were more than willing to do so.
All of us in the Big 12 receive revenue distribution from television, bowl contracts, NCAA Basketball monies, championships, etc. Approximately 60% of our monies comes from television sources; 40% from other sources. We also know from historical data that revenue streams have grown every year for the past 15 years and are already contracted to grow for the next five years. We also recognized that we have been “splitting the pie” by 12 and will now be “splitting the pie” by 10. This means that immediately and automatically all remaining 10 institutions will earn a larger revenue distribution portion.
The five schools indicated that IF necessary, we would be willing to contribute a portion of the new revenue we would be receiving to assist the conference in ensuring these three schools that the financial contributions from the Big 12 would be consistent with those being offered/committed from other leagues. We wanted to make sure our league offices had all the flexibility necessary to keep our league together and that would not negatively impact our current cash flow in our operations. With the current revenue guarantees currently in our conference and projected television contract “upsides”, we actually do not anticipate this having an impact on us… and if it does, it should be minimal.
Q: Missouri's contention in the past has been that all schools in the Big 12 should receive an equal amount of revenue from the league. Why would Missouri agree to a model that is the same as before, which did not share revenue equally?
A: Our feelings on the subject are clear, but we accept this model because it is in the best interests of our league collectively to keep moving forward.
Yesterday, in our press conference, I stated that it was on us to earn more TV opportunities, which means more revenue. Thanks to our increased success in football and men's basketball the past 4-5 years, we have actually benefited from this performance-based revenue model. For example, over the last four years, Missouri has been in the upper half of league revenue received, and no worse than sixth. We have clearly benefited from the performance-based revenue model, and we expect that to continue. Additionally, with two fewer teams in the league, and the same number of broadcasts available, we fully anticipate being televised more often, which is an obvious benefit not only for us financially, but for our fans.
So just how are these figures reached? It can be a lengthy explanation, but to quickly summarize, league revenue comes to each school from two primary sources: one being television revenue, and the other is a combination of bowl revenues, NCAA Tournament revenues, sponsorships and other miscellaneous monies. The TV revenue is so important because it accounts for roughly 60% of the money for the league. Half of that TV money is set aside and split evenly among the member schools. The remaining half of that money is set aside and given based on the TV appearances made in football and basketball (i.e. – the performance-based model). The stronger your team, the more attractive they are to TV, thus the more you will receive. Keep in mind that every school will get a base amount from the appearance model, because of a minimum number of guaranteed appearances. After the minimums are met, the top teams get the bigger share in the end.
A snapshot of the top revenue shares in the league for the fiscal year 2010 includes: 1) Kansas, $12.1M; 2) Texas, $12.0M; 3) Oklahoma, $11.2M; 4) Oklahoma State, $10.7M; 5) Nebraska, $10.5M; 6) Missouri, $10.3M.
Q: This deal seems to be based on promises surrounding the potential for a new television deal, with no guarantees. How can everyone be confident that the league will be able to come up with this promised money and that Missouri will benefit financially?
A: First of all, these promises will become more binding in the near future, as contracts with our current broadcast partners are set to expire and be renegotiated. There are no guarantees certainly. However, the figures the Big 12 Conference and every school in the league have been presented with and accepted, shows our league to be the second-most valuable in terms of TV revenue.
A very important indicator that this is an absolutely solid projection came recently when our current TV partners indicated to us that they valued our overall brand so much that they were not interested in dropping the value of our current contract, despite the defections of two schools.
Q: Why does it seem like there are so many unanswered questions from everyone involved and the answers coming out are very vague?
A: The simple truth is we have a lot of issues to discuss and decisions to be made as a conference. Keep in mind that the league leadership has to meet soon to begin ironing out the vital details of the new conference. Once that occurs, and we believe it will soon, concrete answers will begin to take shape.
Q: How will the new league influence scheduling?
A: We feel like the proposed nine-game conference football schedule and 18-game basketball schedule will greatly enhance the attractiveness for our fans, and generate stronger rivalries among all teams in the league. The Big 12 will have a true champion in football, and all 10 basketball programs will visit each opposing school's venue each year. In terms of non-conference scheduling, it is too soon to know exactly how the new alignment will impact that area, there are just too many details to get ironed out going forward, but we are working on those questions as a league.
Q: Why did Missouri publicly flirt with the Big Ten conference?
A: I would take issue with that premise. The University of Missouri did nothing to link our name to the Big Ten expansion. When the Big Ten announced in December their plans to investigate potential expansion, media outlets all over the country immediately linked Missouri, along with a select few others, to the league. It was appropriate for us to address that speculation, and that's when we said we were a proud member of the Big 12, but would investigate potential opportunities, if presented. We did our due diligence internally and feel good about those efforts.
As I said yesterday in our press conference, I do believe that we erred by not working to publicly dampen any speculation about having our name linked to the Big Ten. By allowing that speculation to continue to run without point-blank refuting of it, that fed the expectations of media and fans further, so much so that when no offer came, it was viewed as a “failure” or that we were “left at the altar,” and that is unfortunate, but it is a lesson learned. We stated very clearly yesterday that we had no offer from another conference, and that in the end, it was clear that our most appropriate opportunity was to protect the long-term viability of the Big 12 Conference, and we are very pleased that the league was able to be kept together in its new format.
Q: I heard President Forsee mention during the press conference that a Missouri television network could be an option. Is this possible?
A: We need to continue maximizing the inventory that all of us will be able to retain in the league. That could include network opportunities, other video sources, expanded corporate partnerships… the possibilities are really limitless here, so we look forward to engaging a lot of different people to address these exciting opportunities.