Last summer, we went heavy on Big East financial reporting in an attempt to put some context behind the extensive conference realignment talk. We wanted to show what the conference made and spent, how much the individual schools received, how that compared to other schools and conferences, and ultimately what the future TV contract might look like.
Of course, this summer is the one that has gone off the rails with conferences not just realigning but straight up imploding, RIP Pac-12. I just didn’t have much new data to sift through and tie in to the Big East’s outcomes. That all changed.
If you would have told me back in high school I’d be giddy seeing new results in Pro Publica’s Non Profit Explorer database… I would have believed you because I’ve always been a huge nerd. And that giddiness at new data multiplied seeing the 2022 Fiscal Year results.
Goodbye COVID, Hello Media Money
Per the Big East’s 990 Tax Form, the conference took in over $81 million in the 2022 Fiscal Year, which ran from July 2021 through June 2022. On its own that number sounds pretty big, but when combined with the data from previous years, it truly stands out.
In fact, it’s the first time since the reformation in 2014 that the conference surpassed $70 million in revenue, and then blew right past the $80 million mark as well, constituting a 36% jump year over year.
What’s the reason behind it? COVID receding as a pandemic, mostly.
If you look back at the chart above, the 2020 and 2021 years give it a little dipper constellation vibe with their dips from the 2019 level. And what happened in 2020? Almost all of the Big East Tournament was cancelled. That amounted to almost $6 million less in revenue in each of 2020 and 2021 (when it was played without fans in the stands).
(This is a bit of a sidebar, but it’s incredible just how important the BET is to the conference. Having looked at a ton of other 990s, no other conference comes close to having the tournament make up such a big portion of total revenue.)
TV Inventory
And one thing that often got forgotten about TV contracts, despite that revenue being budgeted years in advance, in only gets paid out if the games happen. So if you look at the table above, the media revenue goes down from $36M in 2019 to $32M in 2020 as a result of the BET games not happening.
And then you can see in 2021 that even though media revenue does increase to $34M, it still doesn’t reach even the 2018 totals. Again, this is because not all of the games were played. There was a shortened noncon and a plenty of Big East games cancelled (with Providence only playing 17 of the 20 scheduled games).
In 2022, there were no cancellations so FOX and the TV partners had a full slate of inventory, and paid up as such, to the tune of $48.7 million.
Contract Structure
This is where I’ll also note that the Big East contract with FOX, widely reported to be worth around $500 million for 12 years, usually is structured in such a way where there’s a slight increase every year. The first few years are below the average, with the back end of the contract above it.
In this case, breaking up $500M into 12 parts gets us an average of $41.6M a season. Which seems weird, since through 8 seasons, the Big East hadn’t come within $5M of that average number, topping out at $36M.
We already discussed that 2020 and 2021 were COVID affected, and thus well below what was most likely contracted, but trying to sniff out the contract structure gets us a pretty strange quirk.
The first 3 media revenue jumps came in at 3.9% from 2015 to 2017. The next 2 were at 3.7% which just confirms our estimate that the contract was written with specific average annual value baked in.
But if we model out a 3.9% yearly increase and remove the COVID blips, the 2022 media revenue total should have come in around $40.8M. So having that total be 19% higher at $48M has me wondering if this has somethingto do with UConn’s return to the conference.
We are way past the point of just facts at this point and heading straight into conjecture, so don’t take this as anything other than me nerding out, but depending on who you read, the FOX contract had an automatic increase clause should UConn rejoin. Obviously they’ve been back for 3 seasons now, but this was the first one without a COVID inventory issue, so that could also be a reason for that big jump. The Big East isn’t divvying up the same amount of pie with an additional member, the pie also got bigger.
Tournament Success
In terms of what matters to the conference ledger, the TV contract is the biggest slice, but the NCAA Tournament credits make up over a fifth of the total revenue. So needless to say, March success is imperative for the financial health of the conference.
And there’s good news there as well. Without even factoring any part of 2023’s tremendous tournament performance from the conference, the Big East saw a record haul in NCAA credits, topping $23 million in 2022.
As a reminder, NCAA credits are paid out over 6 year increments, so 2022’s inputs included performances from the previous 6 tournaments. The 15 units from 2023, totaling $30M according to Sportico, will end up being paid out starting in 2024 and running through 2029.
Per School Payouts
Of course most of the money the conference makes gets paid out to the individual schools, and although I can confirm there is an NCAA Tournament component in the formula, I still don’t have the exact formula used.
In 2022, The Big East distributed a record $55.2M back to the schools, with Villanova, and its 2 championships, getting a significantly larger share than anyone else.
And here is how the past decade of payouts looks, by team, with Villanova topping $52M and Marquette the closest at a distant $41M.
Conclusions
I’ll be very interested to see what the 2023 media revenue numbers and up looking like, to see if the elevated payments continue or 2022 was some sort of blip. For now, what we can take away is that even though the Big East’s revenue and payments don’t come close to matching that of the power football conferences, it’s still in a very good place, financially.
With renegotiation talks underway about a potential extension with FOX, all eyes will be on if or what that number end up being.
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