Pete ThamelESPNSep 1, 2023, 8:04 AM ET4 Minute Read
Is SMU’s willingness to give up TV money for ACC a smart move?
Pablo Torre reacts to SMU agreeing to give up TV money for seven years to join the ACC.
The Atlantic Coast Conference is expanding from its eastern roots.
The ACC presidents and chancellors met Friday morning and voted to admit three schools – Stanford, Cal and SMU, sources told ESPN. This will bring the league up to 18 members – 17 will play football full-time in the league. The additions affect all sports and will begin in the 2024/25 school year.
The moves have been the subject of much drama over the past month as Commissioner Jim Phillips worked diligently to appease a group of members who wanted to add the schools and others who sought more revenue. The lengthy process ultimately ended with the ACC growing against a backdrop that exposed some of the underlying tensions within the league.
The move came through an atypical process because votes on league matters are usually unanimous and a formality when presidents meet to decide. The ACC needed 12 of 15 votes. Going into Friday morning’s meeting, it was uncertain whether the league had votes or not, a significant difference from how conference expansion normally works.
In a poll more than three weeks ago, four ACC schools disagreed — Clemson, Florida State, North Carolina and NC State. One of them had to turn around for the vote to pass, and all eyes turned to North Carolina State Chancellor Randy Woodson.
The focus on Woodson intensified Thursday evening when members of the University of North Carolina Board of Trustees issued a statement expressing their objection to the additions. This move was perceived in the ACC as a political statement to ensure that UNC Chancellor Kevin Guskiewicz did not distort his voice.
UNC and NC State did not have to be affiliated, but some of the uncertainty surrounding Woodson’s election stemmed from the political consequences of not being allied with North Carolina.
The ACC joins the ranks of a rapidly changing university landscape. Starting next year, the Big Ten will have 18 teams, and the Big 12 and SEC will have 16 teams. The move leaves the Pac-12 with just two programs, Washington State and Oregon State, a continued spiral that has left the league losing eight teams since late July.
Cal, Stanford and SMU will receive a significant discount that will help create a revenue pool to be shared among ACC members. SMU is not expected to receive any broadcast media revenue for nine years, sources told ESPN, and both Cal and Stanford were expected to receive 30% of ACC payouts. The money withheld is expected to result in annual sales of between $50 million and $60 million. A portion of the proceeds will be divided pro rata among the 14 full-time members and Notre Dame, while another portion will go toward a Success Initiative Pool that rewards successful programs.
The move represents a lifeline for the Stanford and Cal athletic departments, which were left struggling by the implosion of the Pac-12. Stanford has an athletic department that is considered the gold standard in collegiate athletics. Both face higher travel costs, which has a significant impact on Cal’s athletic department, which is hundreds of millions in debt.
For SMU, the decision to forgo television revenue meant losing a seat in a major conference, as the school will lean on its wealthy backers to stay afloat until revenue comes in. This marks a significant moment in the school’s rise from the doom of punishment for major infractions that resulted in the school not playing football in 1987 and 1988. SMU did not return to the Bowl until 2009 after the penalties.
Even as the vote went on, the nearly month-long debate over the amendment decision brought to light divisions in the ACC. Both Florida State and Clemson have spoken publicly about closing the revenue gap between the ACC and the Big Ten and SEC.
While these schools had not supported the additions before the final meeting, the decision gives them access to millions more in annual revenue if they succeed in the field. With the ACC television contract running through 2036, the last few weeks have highlighted the uncertainty that will continue in the coming years.
Florida state officials have been particularly vocal about leaving the league. President Richard McCullough said the Seminoles would “very seriously” consider leaving the league if there were no significant changes to the revenue distribution model. This move by the ACC does not appear to change that tenor.
For other schools in the ACC, the three new schools represent both an increase in quality academic facilities and security in numbers. Cal and Stanford were the last major conference schools to still add significant value on the board.