If you haven’t heard, the ACC has a bit of an issue among its membership with roughly half the conference ready to challenge the Grant of Rights in a bid to leave. This development could be the next blockbuster realignment change that appeared out of nowhere or could be some schools blowing off steam. We’re going to dig in with some thoughts on the matter and give some historical context. Let’s begin with the current situation.
Where the ACC Divide Stands Right Now
As of this writing, the ACC has 15 full members: Boston College, Clemson, Duke, Florida State, Georgia Tech, Louisville, Miami (FL), North Carolina, North Carolina State, Notre Dame (all sports except football), Pittsburgh, Syracuse, Virginia, Virginia Tech, and Wake Forest. Some members are unhappy with the current situation in a report by Sports Illustrated’s Ross Dellenger. In a follow-up by Brett McMurphy, the “Magnificient 7” were revealed to be Clemson, Florida State, Miami, North Carolina, NC State, Virginia, and Virginia Tech as lawyers from that group of schools were trying to find a way to break the Grant of Rights. That group has now expanded to the “Exceptional 8” as Louisville is reportedly siding with the Magnificient 7.
All that leads to the question of how did we get here?
How the ACC Reached This Point
The biggest points of contention are the revenue split and the Grant of Rights (referred to as GoR for the remainder of this article). Some schools feel as if they are providing more revenue to the ACC than they receive and no school has been more vocal than Florida State. The Seminoles have been beating this drum for months and were finally able to get others on board. What FSU and others want is unequal revenue sharing that gives better revenue-generating schools (i.e. more postseason success) more of the pie.
Combined with the current revenue-sharing system are the current GoR and television contract. It’s no surprise that the Big Ten and SEC are way ahead of every other major conference in terms of generating revenue. Part of that stems from the contract the ACC signed with ESPN in 2016 that goes through the 2036 season. The conference wanted to ensure it wouldn’t have a Big East-style dissolution (which the ACC contributed to) while guaranteeing some serious revenues.
But 20 years is a long time and the skyrocketing TV media deals are too big to ignore now. No one should be surprised that the current ACC members want a better deal but they are partly to blame for agreeing to a two-decade TV deal. Maybe try to obtain some revenue escalators in the next one?
The current situation is not lost on ACC Commissioner Jim Phillips. He is well aware of what the issues are and understands why teams might be looking to break the GoR. There has been a movement towards a new revenue model to appease the unhappy members but how long will that last? It feels like a stop-gap measure until the “Exceptional 8” can find a new home whether that happens sooner or later.
Where the ACC Goes From Here
We’ll be optimistic here and say the current situation isn’t unfixable. In fact, given the mega moves by the Big Ten and SEC, why weren’t any ACC teams involved in the latest realignment shuffle? Could it be that the GoR actually is legally ironclad? Would the 8 schools that want out be toxic in a legal sense for a new league to the point they are willing to wait? A long, protracted legal battle probably isn’t worth it in the end for any party but we can’t rule that out with all the money involved.
One possible solution going against the grain of doom and gloom: the ACC, ESPN, and current schools come to a new agreement that makes everyone happy. This one won’t be easy with ESPN going into cost-cutting mode but the network hasn’t shied away from dropping big bucks on new TV rights deals. It’s still a massively important part of its business (i.e. milking advertisers for every penny). Another version of this “everyone working together” is that all parties agree to end the Grant of Rights early with the schools that leave the ACC paying an exit fee to compensate the conference and the remaining schools.
Of course, there is the possibility that nothing changes. The current membership begrudgingly sees the current TV deal through to the end followed by a mass exodus to new conferences in a new round of realignment moves.
When it comes to realignment, money runs everything and reports hinting at possible changes aren’t surprising. The ACC membership is currently dissatisfied as the Big Ten and SEC pull away from them in terms of revenue. Furthermore, the Big 12 has a new deal that will pay schools nearly $50 million a year compared to only $23 million for ACC schools. Maintaining the status quo will put the ACC schools further and further behind, which means they will have a hard time keeping up with the competition on and off the field.
An unequal revenue-sharing model is probably the best short-term plan for the ACC, assuming no one is able to break the GoR. (If they did break the GoR, then it’s a free-for-all and the 8 teams can find greener pastures as they see fit). This will make the other half unhappy but it’s clear that the long-term membership isn’t going to survive either way. As for the long-term… there’s a lot of time over the next decade for schools to get into position for the next realignment move. It may lead to a brand new conference, the same conferences with new members, or a new structure. As long as there’s money involved, the realignment wheel will keep turning.
Photo courtesy of Clemson Athletics