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Expansion Apocalypse: Texas Two-Step

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The Texas A&M Board of Regents has a meeting scheduled for Thursday morning and a major topic of discussion will be the University of Texas's Longhorn Network, and specifically the plans of that network to air Texas high school sports. It was previously reported that a move to the SEC could also be on the agenda for Thursday's meeting, but Brent Zwerneman of the San Antonio Express-News has recently reported that such a move is not in the immediate future.

The SEC Media Days this week will not be hosting an announcement of a new member on Thursday, but that doesn't mean it couldn't happen. A&M is a huge name in college football and their brand brings tremendous value to any conference, but they are currently overshadowed in the Big XII by the flagship University of Texas at Austin.

Texas A&M was reportedly close to joining the SEC last summer, when Nebraska and Colorado both bolted the Big XII and it appeared that the conference might not survive at all.

The remaining ten schools from the conference eventually worked out their differences enough to agree to keep things together, but the perception that Texas isn't playing on an even field with the rest of the Big XII could still lead to a shake-up.

Not all of the Big XII schools are key expansion candidates elsewhere, of course. Texas A&M is a big enough fish, however, to make it attractive for a conference like the SEC to expand beyond 12 members.

Expansion beyond 12 members?

In conference expansion, the law of diminishing returns is always a consideration for university presidents. If every additional school would add enough value in terms of revenue to conference value to make expansion worth it, conferences would never stop expanding.

The two primary factors in conference television value are inventory and ratings. Inventory is the number of games (or hours of programming) available for sale to the networks. Each school plays a 12-game schedule and each additional school brings that number of games to the table — but value in inventory is more complicated than that.

To increase value through inventory, the conference has to do more than simply add more games at the same dollar value. As I noted back in May:

By my calculation*, a 9-team conference would be able to offer up a slate of 36 games between it’s members to a broadcaster. A 10-team conference, however, can add nine more games (45 games total) by also moving to a 9-game conference schedule.

Adding a ninth member, by comparison, only adds 8 games over the current 7-game schedule. In terms of inventory, a 10th member actually brings more to the conference than the 9th did.

Since conference schedules are unlikely to expand beyond 9 games regardless of the number of members, the value in adding an 11th and 12th member to a conference will largely be derived from a ratings boost, which will often be attached to a conference championship game that can be scheduled once a league reaches 12 members.

The concept of the championship game, however, is perhaps losing it's luster over time, however, as they have become less and less unique with more conferences moving to that model. In fact, the Big XII has thus-far made no real effort to again comply with it's name and add two more members to once again hold a title game.

There has even been talk that the value of a Big East Championship game in football may not be worth it.

So for a conference to expand beyond 12 teams in football would present a scenario where any additional member would need to add so much value to a conference in terms of ratings, that it wouldn't matter that the addition didn't exponentially increase the conference inventory like the 9th and 10th teams did. A school like Texas or Notre Dame will draw a tremendous number of eyeballs to any game they play in and television executives are willing to pay enough money for a package that includes those games, that they would be a valuable addition to any conference at any time, regardless of the current line-up.

This is why the Pac-12 ultimately didn't become the Pac-16 last summer -- without Texas, Texas A&M and Oklahoma, the diminishing returns of expanding beyond 12 members would have likely affected the massive per-school pay-outs that they ultimately negotiated.

So if Texas A&M and the SEC would to come to an agreement for the Aggies to jump ship, it would be because they are one of those "big fish" who can dramatically increase the value of an SEC television payout. The impact on college sports in general from such a move may or may not be drastic.

Ripple Effect Scenarios

If the Aggies were to leave the Big XII, it would certainly create an internal debate within the conference that could lead to further change. They could seek to expand again to 10 or even 12 schools and targets could include almost any football playing school in the South, Southwest or Midwest that doesn't have a better offer on the table.

Then again, with Texas making promises to the rest of the conference, they managed to agree to hold steady with 10 teams last summer and it isn't unthinkable that the Big XII could just decide to be happy with 9 schools and carry on as currently constituted. It also isn't impossible that the defection of a major player in the league could de-stabilize the whole situation and cause schools like Texas and Oklahoma to reconsider their current status as members.

If the Big XII destabilizes and breaks apart there would be a ton of moving pieces involved and the SEC, Big Ten or Pac-12 could easily snatch up some major players, while former Big XII-North schools like Kansas and Missouri are left looking for a home elsewhere. The northernmost schools and Baylor are likely to struggle the most in finding a new home in a BCS AQ conference and because of that, they will be motivated to try and keep that conference glued together even in the wake of a major defection, but nobody can predict the ultimate effect.

The SEC, looking to balance it's divisions, will potentially add a 14th school either at the same time or shortly after. It isn't impossible that they would grab another former Big XII school and re-shuffle their divisions to make it work geographically. Texas Tech, Oklahoma and Mizzou are likely targets there. If the SEC added two schools from the Big XII, it would likely limit the ripple effect of the move in that no other power conferences would be raided.

However, the SEC may also look north or east and raid a school from the ACC or Big East. West Virginia fits the SEC mold of a big state flagship school, but may not come from a big enough state for the SEC's liking. The North Carolina market, however, is an area where that conference may want to get into and though there has been no indications that UNC or NC State would like to move, those schools stand well situated as flagship colleges in one of the fastest-growing states in the southeast. Furthermore, Florida State or Miami would give the SEC an increased presence in the state of Florida, which is a fast-growing population center itself.

Should the Big East lose a school to the SEC, it becomes imperative to line up a 9th and perhaps also a 10th member for the conference going forward. The loss of one school, even a power program like West Virginia, would not necessarily doom the conference to a loss of BCS status, but a counter move thereafter would be imperative. That could result in the immediate addition of a school from Conference USA or elsewhere along with a heightened interest in Villanova's football upgrade.

Should the ACC be the subject of an SEC raid, they will almost certainly look to cherry-pick a school from the Big East, and likely a northeastern school to fill their gap between Boston College and the rest of the conference. Syracuse was high on the ACC's list early last decade and would likely be considered a fit again today; meanwhile UConn has developed a football program since Boston College bolted for the ACC that would potentially be a fit in that scenario.

If the ACC were to lose a major basketball power like North Carolina, however, they may even look to expand beyond 12 teams themselves in order to attempt to replace the quality of UNC's hoops brand by locking down some strong Big East basketball programs. That scenario, however, presumes that each additional school raided would bring at least it's own value to football and increase conference per-school basketball revenue -- which is probably not realistic.

Conclusions

So long as the Big East doesn't lose more than one team, however, the conference is likely to survive. It is no secret that most of the Big East football schools would jump at a better offer from another AQ conference -- but no better offers have truly emerged. Adding Big East football schools is unlikely to dramatically increase the revenues of those other power conferences, and so there will not likely be many opportunities for movement for the remaining schools.

The loss of a single football school would put the conference back to where it started before the TCU addition, which is ultimately no worse off. A move by Texas A&M to the SEC would potentially cause a chain reaction of further moves, but the Big East need only worry if that chain reaction causes multiple schools to become attractive to a conference like the ACC.

Megaconferences don't make financial sense just yet. There are a finite number of programs in college that are worth the type of pay-outs that the six power conferences receive every year. Until and unless that changes, don't expect any conference to start adding teams just to keep up with the Joneses. Conference expansion occurs when an opportunity to expand makes financial sense.