In January of 2022, inside a convention hall within the JW Marriott hotel in downtown Indianapolis, the sport’s most powerful leaders gathered to vote on expanding the College Football Playoff.
Seven months of quibbling over an expansion format had finally led them to this pivotal moment. On the morning of Georgia’s eventual win over Alabama in the national championship game, they met in an effort to finalize a 12-team postseason. Instead, disagreements continued as three conferences — the Big Ten, ACC and Pac-12, members of the now-infamous “Alliance” — pushed back against the proposal.
At some point, as discussions grew heated, then-Big 12 commissioner Bob Bowlsby, frustrated and exhausted of the indecision, slowly packed his bag and began to rise from the table.
“The meeting isn’t over,” someone told him.
“It is for me,” he shot back.
What happened that day still lingers across college athletics.
Last month, more than two years later, commissioners agreed on a new CFP structure featuring an uneven revenue distribution model that is likely to have long-term financial impacts on the industry. The revenue model — a combined 58% of CFP cash flowing to two conferences, the SEC and Big Ten — presents adverse budgetary impacts for the other 99 programs in the Football Bowl Subdivision and grows the gap between them and the sport’s two giants.
But could this have been avoided if a decision were made in 2022?
“Our inability to conclude a deal two-plus years ago had a pretty significant impact on where the financials ended up,” said MAC commissioner Jon Steinbrecher, a leading voice in college sports who often chairs the CFP commissioner meetings. “What was on the table in 2022 was simply different. The delay opened the door for continuing changes to where we ended up.”
After the Pac-12’s collapse, the swelling of other leagues and increasing pressures of athlete revenue sharing, the sport’s two juggernaut conferences negotiated a one-sided deal, in part, by using a lingering belief that they would abandon all others to form their own postseason.
Would the SEC have really taken its proverbial ball and left the CFP?
“Absolutely,” SEC commissioner Greg Sankey told Yahoo Sports. “When we ended that set of meetings in January 2022 without a decision, I was clear: If you are going to walk away from this opportunity, we are going to reevaluate our position on format, revenue sharing and governance.
“People called me (after the latest deal) and said, ‘Why did you take a hard line? Why did you put us in this position?’ I said, ‘You guys walked away from the deal.’”
Yahoo Sports spoke to more than two dozen stakeholders across the industry — some directly involved in the negotiations — to learn more about how the CFP’s new structure came together (and nearly fell apart), its long-term impacts on college sports and an inevitability on the horizon: a vastly different “super league” than the one recently circulated.
The new deal
On Tuesday, College Football Playoff leaders — the 10 FBS commissioners and Notre Dame’s athletic director — gather in Dallas for their annual two-day spring summit. It is their first meeting since they agreed on the new CFP television deal, revenue distribution model and format. The details of the new deal are as follows:
– TV: A six-year extension with ESPN as the sole rights-holder for the 2026-2031 playoffs and guaranteed compensation averaging $1.3 billion annually.
– Revenue distribution: The Big Ten and SEC each earn 29% of the $1.3 billion; the ACC gets 17.1% while the Big 12 receives 14.7%; the remaining amount will be distributed to Notre Dame (about 1%) and the 64 Group of Five teams (about 9%).
– Format: While format was not finalized, certain “protections” were, including an automatic spot for the champion of the four power conferences and highest ranked Group of Five team; a 12 or 14-team field; and qualification guarantees for independents like Notre Dame related to their place in the rankings. For 2024 and 2025, the format is set as a 5+7, 12-team model, which grants automatic qualifying spots to the five highest-ranked champions and seven at-large spots to the next highest-ranked teams.
The new revenue distribution model shook the college athletics landscape for its disparities.
In the previous revenue structure, the power conferences split evenly 80% of the CFP’s $460 million in annual revenue and the G5 received about 19%. In real money figures, each power school earned about $6 million from the CFP in base distribution while G5 schools got about $1.2-1.5 million annually.
In the new deal, the gaps in figures are striking, especially among the four power conferences. The SEC and Big Ten schools will see their annual distribution triple if not quadruple to around $23 million (SEC) and $20-21 million (Big Ten). Those in the ACC and Big 12 will earn anywhere from $12-14 million. Notre Dame will earn $12.5 million annually, plus a $6 million bonus if it qualifies for the playoff — an $18.5 million figure. Independents, such as Notre Dame, receive the one-time participation bonus, but all other participation bonuses — which are in the current model — were removed.
G5 programs will see a $300,000-500,000 increase to about $1.8 million.
The results of the new CFP deal are pretty obvious from those in and outside of college athletics.
“The rich are getting richer,” said Bob Thompson, the former Fox television executive.
“And the poor get poorer,” added Bowsbly.
‘Heated’ negotiations
Over the course of the six-year CFP contract, an SEC school will earn about $140 million in distribution. A school in the ACC will earn about $80 million.
The revenue structure makes the situation more precarious in the ACC, where Florida State and Clemson have already started the process of seeking a legal mechanism to exit the conference, citing an expected $20-30 million annual financial gap between ACC and SEC/Big Ten schools.
“With the CFP numbers, we’re now talking about being $40 million behind every year,” said Florida State athletic director Michael Alford. The elimination of CFP performance-based incentives makes these gaps “almost impossible for individual programs to close,” Alford said.
Under the current CFP contract, teams that qualify and then advance through the CFP earn bonuses of $4-6 million per round. Those will be eliminated starting with the new deal in 2026.
In an interview with Yahoo Sports, ACC commissioner Jim Phillips described negotiations as “incredibly difficult and challenging” and at times even “heated.”
“I don’t think anybody loved all of it, but everybody tried to message what they felt was important for their conference,” he said. “You bargain and push as hard as you can.”
The CFP revenue distribution model was largely based on a conference’s historic success in the playoff over the previous decade while considering realignment moves. The SEC leads all conferences with 17 in the four-team field when factoring in Oklahoma and Texas. The Big Ten is next at 12 and the ACC (7 teams) and Big 12 (2) follow.
If a 14 or 16-team playoff were applied to the previous 10 years, the SEC would have been responsible for roughly 40% of the participants — a figure that Sankey used during an intense six-week negotiating window that played out among CFP leaders from early February to mid-March.
In an interview, Sankey suggested that the league at first requested more than 29% of the revenue. “We varied a bit from the original revenue target,” he said. “I presented the research. It’s simply negotiating.”
“We wanted to make sure we captured in this deal what we have contributed,” added Big Ten commissioner Tony Petitti.
Petitti focused at first on format, proposing the CFP expand beyond 12 teams and remove as much subjectivity as possible in the selection process by adding multiple automatic qualifiers per conference. However, discussions shifted from format to revenue.
With conferences still in a state of flux, Big 12 commissioner Brett Yormark led a movement for a look-in provision after the 2027 playoff. The provision can be exercised by a power league and would trigger a re-evaluation of the revenue structure based on CFP participation and performance over the next four years (2024-27).
The provision can also be triggered by “material realignment.”
“I can’t sit here and say I’m thrilled with the revenue model, but it’s the best deal we could get,” Yormark said. “I’m bullish on the Big 12 and I’m betting on the future. With the investment we are making in football, we will be in a better position when that look-in presents itself.”
Negotiations mostly involved the four power conference commissioners and new Notre Dame athletic director Pete Bevacqua. The five held group calls multiple times a day for roughly three weeks.
As the only individual school with a spot on the CFP governing board, Notre Dame held a unique place during the talks. “We were kind of Switzerland if Switzerland had a really big army,” Bevacqua said with a chuckle.
During negotiations, Bevacqua did not have to fight to keep Notre Dame’s place within CFP governance, which, he said, is “a testament to Notre Dame, not to me.” However, he did acknowledge conversations among a small subsection of leagues — the SEC, Big Ten and perhaps Notre Dame — walking away from the current structure.
“You say, ‘Walk away.’ But walk away into what?” Bevacqua said. “What would the landscape look like if we couldn’t have negotiated a deal? That was such a great unknown.”
During an interview with Yahoo Sports, Petitti emphasized that it was a real possibility.
“I think we felt confident that we were willing, if we couldn’t craft a deal, that we’d look at other options. We would have started over,” he said. “Without seeing better alignment, we weren’t going to sign. We were 100% confident and made it clear that we were only going to do a deal that worked for us.”
Mounting pressures
On Feb. 2, four days before CFP leaders met in Dallas to begin serious negotiations over the particulars of a new deal, the SEC and Big Ten announced they were creating a joint advisory board to explore the pressing issues in college athletics.
Was this strategically timed as a way to position the two leagues as partners ahead of negotiations? Many believe so.
But the SEC and Big Ten do share plenty. Their growth in realignment has greatly increased their power, much of it rooted in the revenue-generating sport of football.
Next year, their 34 members will encompass 61 of the 88 AP football national champions. From a revenue perspective, their schools will soon earn $70-plus million annually in total distribution — at least $20 million more than the next conference’s media rights deal.
Because of these revenue figures, they share something else: the responsibility in litigation costs; increasing pressures around athlete compensation; and the threat of private equity. These were all catalysts for their high asking price in the CFP revenue structure.
Litigation is the most pressing of the issues.
The NCAA and power conferences have been engrossed in settlement discussions in the House antitrust case, which seeks billions in retroactive name, image and likeness (NIL) pay. A settlement is a two-part endeavor. Schools would likely owe more than $1 billion in backpay, plus adopt a future compensation model for athletes.
While settlement talks mostly remain private, many administrators believe that any agreement comes with an annual revenue-sharing figure of $15-20 million per school.
“You hear SEC and Big Ten folks say, ‘We’re going to pay most of the House lawsuit!’ And they are,” said John David Wicker, the athletic director at San Diego State. “But per school in the Big Ten, they are going to receive more money than our conference as a whole. As we look at the issues that we face as an industry, this just further exacerbates things.”
The Group of Five’s situation in any new model is cloudy. For now, the highest-ranked Group of Five champion earns a spot into the field.
Despite that spot being contractually protected in the new deal, Sean Frazier, the athletic director at Northern Illinois, wonders if it will really continue. Frazier wants to revive a failed effort from years ago to create a four-team Group of Five championship tournament hosted by three bowl games (two semifinals and a championship).
“We have to think outside the box,” he said. “Next five years, we might not have access to the playoff or increased dollars.”
And what about sharing revenue with athletes? Most Group of Five football programs do not generate a profit, and many G5 athletic departments are subsidized by university and student fees.
Revenue sharing complicates matters and further tiers the Football Bowl Subdivision.
“There’s not been a level of communication about what this is going to look like for those of us left behind,” said Jared Mosley, athletic director at North Texas. “You have two conferences out here trying to forge a path best for them. And there’s not been a discussion about what does that look like for everybody else.”
In the ACC and Big 12, the gaps in the CFP revenue structure sent some administrators scrambling. They had budgeted for more in future revenues.
For instance, in the previous structure, each Power Five conference earned about an 18% cut of CFP dollars. If that remained the same in the new deal, Big 12 schools would be getting at least $3 million more annually.
“What’s going to happen is, if one of those Big 12 schools have a good year, their coach is going to be hired away by the SEC or Big Ten and they’re going to feel the pain the G5 has been feeling,” said Andy Schwarz, a California-based economist specializing in sport economics.
TCU athletic director Jeremiah Donati has been outspoken publicly about the new CFP structure. “We shouldn’t be surprised that the conferences and schools are going into this acting solely in the best interest of their conference and respective institutions,” Donati said. “We’ve demonstrated for years that this is our model — we don’t make decisions in the interests of the greater good.”
Amid CFP negotiations, there were more pressure points other than litigation. Weighing on them was ESPN, which twice set a deadline for the CFP to formally accept the deal. The network provided the highest bid for the CFP package by a wide margin, according to those familiar with the bidding process.
But another pressure lingered.
A group of college athletic administrators, backed by private equity and led by TurnkeyZRG search firm CEO Len Perna, developed a plan for a long-discussed super league that would break out FBS football into a separate entity by rearranging conferences for geographical purposes and consolidating broadcast rights for higher revenue values.
Plenty of respected voices in the college and university sphere – even those in the SEC and Big Ten footprint — supported further examination of the plan and encouraged commissioners to delay any CFP agreement.
North Carolina athletic director Bubba Cunningham, part of the super league group, believes the concept offers a financial solution for athletic departments fearing a reduction of sports teams with the onset of revenue sharing while also providing an alternative to what many project as a 30-40 school professional college model.
But there are hurdles. “If you go down this route, it requires you collectively bargain,” he said. “That may be where we end up anyway. I’d think you’d also need some legal protections from Congress.”
In the end, the obstacles were too great, chief among them the implosion of long-standing conference affiliations and the abrupt end of league television contracts.
“The biggest thing was ESPN and FOX,” said one person with knowledge of the talks. “They were not going to rip up cost certainty to redo the media landscape.”
However, the mere possibility of the super league was an “existential threat to some conferences,” Steinbrecher said. Some of the most valuable programs in several leagues were approached with distribution figures in the nine figures — yes, nine — according to those with knowledge of the talks.
“It was mentioned in the room as a concern,” said outgoing American Athletic Conference commissioner Mike Aresco, “but I never bought it.”
“Multiple concepts were on the table from different groups,” said Bevacqua, “including concepts that disrupted the system and fundamentally recreated the college football space. All of it led us to believe the best solution was to continue the CFP for eight years.”
What could have been
In January of 2022, Jack Hawkins, the longtime president of Troy and a member of the CFP Board of Governors, anticipated the approval of an expanded College Football Playoff.
It was an exciting time. Not only would the Group of Five gain access to an automatic spot in the playoff, but they’d see a significant increase in their distribution checks. In that proposal, the Group of Five would earn $225 million annually, or about $3.3 million per school, he said.
Two years later, after that proposal failed, the Group of Five is receiving $115 million as part of the new deal, or about $1.8 million per school.
“It was Abraham Lincoln that said people are about as happy as they want to be,” Hawkins said. “You can look at the glass half empty or full. We look at it as half full.”
There is a point of contention on how finalized a new CFP contract was in 2022. Even Hawkins used the word “speculated” to describe any tentative deal. But Bowlsby remembers that the proposal was much more “measured and fair” than what was adopted last month. And Sankey believes that the 2022 proposal offered the “opportunity to continue with the same approach.”
Not everyone remembers it that way.
“There were no guarantees at that time that the revenue or voting would stay the same,” said Phillips, the ACC commissioner.
Phillips is the last commissioner of the Alliance who remains in college athletics. Kevin Warren, then of the Big Ten, is now the CEO and president of the Chicago Bears. George Kliavkoff, then of the Pac-12, was dismissed earlier this year after the league melted from 12 to two members.
The three of them did not support expansion in 2022 for an assortment of reasons.
The Pac-12’s interests lied with the Rose Bowl, which was at first against shifting its date and time for inclusion into the expanded playoff (it eventually did). The Big Ten wanted its champion to have an automatic berth. And the ACC’s concern lied mostly with athlete health and well being, given the extra games played in an expanded field — something at least partially rectified, Phillips said, with changes to the holistic calendar.
“Those three conferences were very specific about the areas that still needed to be addressed to move forward and none of those ended up being captured to a conclusion agreeable by everyone,” Phillips said. “To say that led us to a completely different structure is wrong.”
Either way, the ramifications of the new CFP deal are deep, as two conferences distance themselves from the rest with uneven revenue distribution.
Schwarz, the economist, sees it a different way. “The new revenue model is not causing the separation, it’s a reflection of the separation,” he said.
Cunningham, the UNC athletic director, describes the CFP structure as a “manifestation” of a trend that was ignited 40 years ago when the Supreme Court permitted conferences to control their television rights — a move that ballooned resources and separated the big from the small.
“You see more of a stratification of successful programs. There is a relationship between resources and your ability to compete,” he said. “It’s incumbent to be successful in football.”
In an effort to appease its football powers and reward their success, the ACC enacted last year their own uneven distribution of wealth. The league is using its CFP monies, normally evenly distributed, to create what it terms a “success initiative” fund that pays units to individual schools based on reaching benchmarks: (1) qualifying for a bowl game, (2) finishing in the top 25 and (3) participating and advancing in the CFP.
The value of a unit is estimated to be $2-4 million, depending on the overall conference CFP distribution. An ACC team can earn as much as $25 million if it advances to the championship game.
“The success initiative money might mitigate the gap,” said Miami athletic director Dan Radakovich, “but we (ACC) have to play better and get more teams in the CFP so that in the next six-year cycle, when it is reevaluated, we’ll get more revenue.”
There is cash available in other avenues as well.
Over the last year, college football has caught the attention of venture capitalists. Various private equity entities have emerged with serious interest in the space, most notably Redbird Capital and its CEO Gerry Cardinale; Weatherford Capital and its most notable partner, former Florida State quarterback Drew Weatherford; and global investment giant Sixth Street.
A number of their representatives have held meetings with university and athletic administrators related to a private equity-fueled “service fund,” said one person with knowledge of the discussions. The idea: to front an exorbitant amount of capital — hundreds of millions of dollars — that athletic departments can use to, in one example, pay a conference exit fee, or prepare for the next iteration of athlete compensation: revenue sharing or employment salaries.
What’s next
During a meeting of CFP commissioners in November, well before the revenue negotiations began, a discussion point emerged about the CFP’s future.
“There was a belief that all of us had to stay together as is,” Sankey recalled. “I never viewed it that way.”
Sankey’s honest and stunning admission may indicate the future course of the SEC and perhaps the Big Ten too. It casts doubt on the glue that binds the nine leagues together.
Schwarz believes the future is not necessarily two 20-team conferences that create a separate entity, as so many predict. Instead, he sees two 24-team conferences plus a third, possibly three 20-team leagues. “They’d all love to rip one of the four apart and make it a Big Three,” he said.
Said one high-placed college athletics insider: “Five power leagues could not survive. Neither can four.”
Washington State president Kirk Schulz, a longtime member of the CFP Board of Governors, refers to the college landscape as undergoing a “curing” of conferences, something that happened to his very own league: the Pac-12. The most valuable programs consolidate — in this case, with the Big Ten — and leave the least valuable behind.
Schwarz wonders when that will happen in other conferences. In the ACC, should Boston College, Syracuse and Wake Forest worry? In the Big Ten, should Northwestern, Purdue and Rutgers be concerned? What about Vanderbilt, Mississippi State, Missouri and Ole Miss in the SEC?
“It is a winnowing process,” said Schwarz. “It’s natural. It’s happening in our economy broadly. The small local chain is a dying thing. In America, there’s these two strains: You want to be an economic powerhouse but also want to be fair to the little guy.
“There’s a point when the Amazons of the world say, ‘I don’t need to be fair to the little guy any longer.’”
Aresco, the AAC commissioner who is retiring this summer, believes the CFP’s revenue structure puts college athletics on a perilous path. He cites a commentary from Pulitzer Prize-winning columnist George Will about the Getty Museum, operated by the J. Paul Getty Trust, the world’s wealthiest art institution.
“The Getty could buy up pretty much everything, but they decide not to because they don’t think it’s a good idea to have everything concentrated,” Aresco said. “They make a conscious decision not to do that. I hope that those two conferences realize that what’s good for the entire enterprise is good for them too, that it’s not good to concentrate too much clout and too much power.”
The issues go beyond revenue. The next step is a format.
The Big Ten and SEC have decision-making powers over a future format, too, though any decisions are expected to be made in consultation with ESPN and the other two power leagues.
Big Ten and SEC staffs are expected to soon get working on exploring not just a format but a potential change in the selection process with regards to the committee. Could computers return to the formula? Will the committee’s composition change? Could there be multiple automatic qualifiers per conference?
Questions remain.
And so do concerns.
“The gaps just keep getting wider. That’s concerning,” said Teresa Gould, the Pac-12 commissioner. “College athletics is one of the most inefficient economic models that probably exists. From a business perspective, it’s not particularly logical. I’m concerned that everything that is happening — financial disparities and litigation — is going to put people out of business.”
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