6:00: Morning News

How IMG’s third-tier deal impacts fans

Following Wednesday’s report by the Sports Business Daily that West Virginia University has reached a third-tier multimedia rights deal with IMG College, here’s a glimpse at the potential scope of the agreement and what it likely means to Mountaineers fans.

First, to define what this third-tier rights package entails:

• Television rights to one football game per season and a handful of men’s basketball games that are picked over by the major networks

• Complete radio broadcast rights

• Coaches’ shows produced for television, radio and web streaming

• Television rights to all other WVU sports (the ones lovingly categorized as non-revenue).

• Rights to sell advertising signage and sponsorships

• Online content.

Now, a deeper, speculative look at the agreement, which is pending as IMG and West Virginia athletics director Oliver Luck (and, no doubt, a gaggle of attorneys) attend to the final details:

Who were the other bidders?
Already partnering with more than 60 schools and three conferences, IMG College is one of the industry’s behemoths, alongside Learfield Sports (51 schools, two conferences), which also contended for the WVU rights package. Within the Big 12 Conference, IMG partners with Texas, Kansas, Baylor and TCU, while Learfield owns deals with Oklahoma, Oklahoma State, Kansas State, Texas Tech and Iowa State.

Other companies submitting bids for the WVU package included Nelligan Sports (32 schools), CBS Collegiate Sports Properties (seven schools), Fox Sports Net, Front Row Marketing (eight schools, the NHL’s Flyers, the MLS’ Philadelphia Union and six minor-league franchises), Legends Sales and Marketing (a New York Yankees-Dallas Cowboys co-owned venture), XOS Digital and West Virginia Radio Corp. (owner of MetroNews and the company that historically has produced the radio broadcasts for WVU football and men’s and women’s basketball).

What is the deal worth?
The university has yet to disclose the terms — and with final negotiations ongoing, some inventory of rights (signage, ticketing, digital) could be retained by the school. But sources have estimated IMG will pay WVU anywhere from $75 million to a whopping $120 million over 12 years.

In 2009, IMG guaranteed Ohio State $110 million over 10 years, but in 2012 Learfield signed two deals that may prove more relevant: a 10-year contract with N.C. State worth $49 million, and a seven-year deal with Wisconsin that pays $52.5 million.

Note, however, that a superficial comparison of these deals is risky, because contracts vary from school to school based upon the depth of rights included in the package. Some agreements even include infrastructure pieces such as video boards for football, baseball or soccer stadiums.

What becomes of the on-air talent?
The most public aspect of this agreement involves who’ll emerge as the voice of WVU football and basketball. That’s a role Tony Caridi has filled the past 15 years, and he’s currently in his 27th year overall with the school-owned Mountaineer Sports Network. He hosts the weekly in-season call-in shows for Dana Holgorsen and Bob Huggins, and occasionally emcees events tied to the athletic department.

While IMG could stipulate that it brings in its own broadcasters, the company typically favors retaining longtime play-by-play announcers who have forged an identity with a school’s brand.

Why partner with a company such as IMG in the first place?
College athletic programs have been outsourcing various aspects of marketing and multimedia rights for the past two decades. In fact, West Virginia and Michigan State are the last two major-college holdouts when it comes to auctioning off these lucrative assets. Of course, it’s only lucrative if the revenue from selling these rights exceeds what the university would have derived from continuing to manage them in-house.

For years, key members of the WVU athletics department felt they could grow healthy revenue streams while serving as the best stewards of the university’s branding and marketing, and even now, there remains some risk in how an outside firm like IMG will be received within the state. Of course, once the deal is signed, it’s up to IMG to make a return on its financial investment.

“This works from a revenue standpoint at programs all over the country, so it’s not all bad,” an industry source told MetroNews.

How could IMG change the relationship between WVU and advertisers?
The source said “if anyone was going to overpay for WVU, it would be IMG because they already had the Pitt and Marshall properties,” which are believed to be underperforming (especially in Marshall’s case). That portends a touchy scenario whereby IMG could squeeze WVU sponsors to help subsidize Marshall by bundling advertising packages.

“IMG could say, ‘You want the Mountaineers? Then you’re going to have buy Marshall as well,'” the source said. “I promise you, IMG will hold some people hostage to get more money for Marshall.”

It’s hard to imagine that sales pitch playing well with business owners who are gold-and-blue through and through.

The source said most of the state’s six-figure advertisers are already aligned with WVU, meaning IMG’s sales staff will need to target more smaller companies willing to spend $20,000 and $40,000 annually. “They are going to have to hit a lot of singles and doubles to hit that number, and they’re going to have to do that in a state where there’s not a lot of business.”

Regardless of how much IMG agrees to pay WVU — recalling once more that $75 million or $120 million range mentioned by sources earlier — advertisers who want to renew their sponsorships of the Mountaineers can likely expect to pay more.

“(IMG) will assume right away that the prices WVU has been charging are too low, so they’ll jack up the rates,” the source said. “In that case you might lose some sponsors who are faced with a 15- to 18-percent increase with no new inventory.

“It’s a question of how hard-line IMG will be.”

What else will fans notice?

With IMG aggressively chasing revenue, expect more advertising signage throughout Milan Puskar Stadium and the concourses of the WVU Coliseum. The Mountaineers in-house marketing team previously sought to minimize advertising clutter, but in the coming months, with every inch of property available for sponsorship, how long before the urinals feature a Target logo?

Sponsorships also could infiltrate the radio broadcast and the public address system, with every third-down conversion leading to a “United Bank FIRST DOWN!” or every trip inside the 20 meaning the Mountaineers have entered “the Coca-Cola RED ZONE!”





More News

News
PSC approves settlements involving Mon Power, net-metering cases
Rate increase went into effect Tuesday.
March 27, 2024 - 9:42 pm
News
Speakers at Focus Forward symposium discuss AI capabilities in West Virginia
The event was organized by the West Virginia Public Education Collaborative and the Claude Worthington Benedum Foundation.
March 27, 2024 - 8:30 pm
News
Justice vetoes vaccination exemption bill, draws praise from healthcare groups
Educational and healthcare organizations banded together to urge a veto.
March 27, 2024 - 6:35 pm
News
Testimony wraps up in attempt to remove 2 Jefferson County commissioners from office
Three-judge panel hears 2 days of testimony.
March 27, 2024 - 5:11 pm


Your Comments