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Here’s the latest on the Pac-12 Networks and DirecTV (unless something has changed in the last few seconds).
The Pac-12 Networks likely will be forced to overhaul their cherished business model in order to reach a carriage agreement with DirecTV this fall.
DirecTV’s parent company, AT&T, may take an equity stake in the networks, which have been wholly owned by the conference since their launch three years ago, according to industry sources.
Such an arrangement, if finalized, could require the networks to change the terms of existing carriage deals with partners like Comcast and DISH, potentially resulting in lower subscription prices across the board. Commissioner Larry Scott, who was not available for comment, has extolled the virtues of 100 percent ownership over the years, saying it would enhance the networks’ long-term value and create more flexibility to take advantage of changes in technology and consumer behavior. The Pac-12 Networks have approximately 12 million subscribers nationally, according to media research firm SNL Kagan. Nor are the Pac-12 Networks as profitable as the conference initially hoped, sources said: They’re generating just $1 million per year (approximately) for each university – far less than the Big Ten and SEC networks distribute to their schools.
AT&T, which acquired DirecTV in a $49 billion deal this summer, has an existing distribution agreement with the Pac-12 Networks (through U-verse) and a wide-ranging sponsorship and infrastructure partnership with the conference. Sources did not know the percentage of equity AT&T would receive if the deal is finalized. Also unknown is the exact value of the DirecTV carriage agreement (if finalized), although sources said previous projections of $2 million per school annually were thought to be accurate. Lazard, a financial advisory company based in New York City, is believed to be working with the Pac-12 on the AT&T deal.
Considering the regional differences in population density and rate of subscription (among other factors), how is Scott supposed to match those figures?
If you don’t expect to match dollar-for-dollar yet 20% is unacceptable, what percentage would be acceptable to you? Well, I would expect USC to get more for their 3rd Tier rights than say Iowa State or Kansas State or any of the lower profile Big 12 schools.
The PAC 12 will be 10s of millions behind the SEC and B1G and even the Big 12 is anywhere from 3-10 million more depending on the school. Remember, with Fox owning the Big Ten Network and ESPN having the SEC Channel, both of them were quite happy to see Pac 12 go independent because neither of them own distribution systems themselves. But going back to DirecTV for a second, they didn’t have the luxury the other cable networks did to not add the P 12 nationwide. 1) a couple of years ago the Yankees sold a large portion of their network to FOX, not easy to make a go of it on your own. BTN has had it’s own issues, DISH has carried it off and on and this year Suddenlink finally signed on to carry BTN after carrying Pac12 for a few years. Yeah, it seems as though Larry Scott’s strategy of a wholly owned network for the conference will be a failure.
I think DirecTV wants to put the Pac-12 Network on a premium tier and pay the networks for the subscribers who pay for that higher tier of service, unlike the SEC network for which ESPN receives a certain amount per subscriber in the WHOLE TV footprint of the SEC and a lesser amount for all the other subscribers who are not in the SEC’s TV footprint. Just cancelled my scheduled installation of Directv for this Sunday and un-cancelled Frontier FIOS TV. Why would I dump a service that I enjoy immensely because the PAC 12 can’t see the benefit of higher revenues WITH a partner.

He and the CEOs know that partnering with a cable network that is dependent on a fixed infrastructure of wire is not the future for the rest of the world, satellite is. It all comes down to being patient and not listening to guys like Wilner and developing great content. No sympathy for the Pac12 who demands to be treated better then the SEC or Big10 conferences, even though those two conferences have far better national coverage numbers according to TV ratings….
Not once in the 15 years I’ve been to Jakarta, Tokyo, Taipei, Manilla, etc have I ever heard a local lament about missing a college football or basketball game, much less from a specific conference. By the way, from reading these comments, I see that David is the lone voice of PAC 12 support. If you have a Direct TV subscription it will cost $50 and you can even use your PS3 as another Direct TV receiver. There are various ways to pay your DirecTV bill such as it can be paid online, by mail, by phone, in person at the collection office etc.
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That’s one-fifth the total of their Big Ten and SEC counterparts, which are co-owned by FOX and ESPN, respectively.
The current distribution model for television is dying, why sacrifice independance for a dying model? If they were serious about thinking long term they would lower the asking price and get on every distributor. If that is the case, Scott would have been better off partnering with ESPN or Fox from jump.
Whether its the basic tier inside the respective footprints or the sports tier or plus package outside the footprint. Everyone else but Charter, FIOS and DirecTV has a deal done and have had a deal done for years. Had we partnered with Comcast for example, they could have used the P 12 network to squeeze ESPN and Fox by not giving them access to certain markets if they didn’t discount their rates for those networks where the Pac 12 was located.
AT&T is the kind of partner Scott has wanted all along (only second to perhaps, Apple) who wants to break the monopoly of cable distribution and go to all platforms simultaneously. After all, if you can’t get $20 million a year from a regular cable syndication deal…why pack it in? Blame their greed and 300 million dollar payrolls bankrolled on the backs of every single cable household in the county paying 7 bucks a month. The landscape of sports viewing is likely moving to pay-per-view and as a result I think providers like DirecTV are unwilling to give per subscriber deals to sports networks like they were before.
What she had a really hard time understanding was that I could care less about the NFL, HBO, Showtime or other hook-packages… if no Pac12 Network no deal. Better yet, pay close attention to the business models for the SEC, Big 10 and PAC 12 networks. I could have told him from day one DirecTV was going to play hardball knowing PAC fans aren’t going to give him the leverage SEC fans would. Given below are the links that lets you access all payment options as well as other details.
In addition, AT&T is already investing a lot of money upgrading stadium technology for mobile phone users at many Pac 12 schools.
They wanted to pay less because they knew college football fans in Florida and Vermont weren’t going to tolerate a huge increase in their bills. If this new venture with AT&T yields $30 million a year, will the chancellors really balk at that amount of money?

Apparently I wasn’t the only one (after they tested Pac12 Net on channel 612) because it was a two week wait for installation and they had started doing installs 7 days a week. He tried to make a KILLING off of holding his Conference network hostage for larger subscription rates.
The CEOs have been very aggressive already in recruiting foreign students for tuition to the point of getting flack from state officials for doing so. The PAC 12 isn’t thinking about building a SPORTS network, they are trying to build a real, honest-to-God network that features sports along with any other programming that generates revenue. Where he failed was not understanding the PAC fan base and people like you who need their Sunday Ticket over their college. PAC fans wouldn’t drop DirecTV to give PAC the leverage they needed like B1G and SEC fans would. If you are a customer and wants to have an online access, you must have registered your account. Direct tv bill payment number for pay your bill through an Automated Phone System – is Call on: 1-800-531-5000. He can’t push distribution for the same product (conference network) at half the cost. The SEC Network is available in something like 90 million homes while the PAC is available in a little over 10 million. If they lowered it for Charter (who will probably carry it when Time Warner goes through) than they would have to lower it for everyone, favored nation clause.
But, as we all know, this has petered out now and we can see that the proposed AT&T buy-in to the Pac12 Network is now under negotiations.
The SEC and Big 10 networks operate under a business model where they partner with a major cable provider. That’s why the PAC will always lag the SEC and B1G conferences in fan support and why those conferences dominate the media. The registration process is easy and you need to provide required information as well as create username and password.
Late start times, 1 week notice for game times, poor distribution for the network, especially in Southern California, their largest market. Kansas State took in over 4 million for their 3rd Tier rights every year for the past 3 years while USC hasn’t been getting 1 million.
That is much more complex and I doubt it will be resolved in less than several months – if ever. I understand the leverage Fox and ESPN hold to force those MORE EXPENSIVE rates for their conference networks. The PAC 12 Network went the extortionist route with DirecTV and it predictably FAILED MSERABLY. The brains behind the PAC 12 Network made a horrible business decision by giving DirecTV the middle finger.
But we’re not dropping the Ticket to get access to the little watched and very maligned PAC 12 Network.
As a sports fanatic, I’m doubly disappointed that my wife cannot watch her beloved Cal Bears, because they are off to a fine start this season and they are a contender folks. You’ve got three or four big name schools and the rest are scum-sucking bottom feeders. They’ve been waiting for the DirecTV sports fanatics to drop bait and come running for years now.

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