SMU to ACC? What fans should know before thinking about conference relocation
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DALLAS — Here we go again.
SMU, according to multiple people familiar with the situation, would be on the short list of candidates if the ACC were willing to expand. That’s been the sense around SMU for about a year now, but now the ACC reportedly is examining potential expansion.
The short list of expansion candidates, according to multiple reports: Cal, Stanford and SMU.
You hear that? That’s the sound of SMU fans getting their hopes up for a power conference invite, hoping it doesn’t go the way their Pac-12 — or are we calling it Pac-4 yet? — hopes went.
Here are some things SMU fans should keep in mind about a possible relocation to the ACC.
Same pitch, different league?
Long story short: yes. But with a wrinkle to it.
Over a year ago, when USC and UCLA opened up another round of realignment by going to the Big Ten, SMU had internal confidence about their chances to go to a bigger conference. SMU representatives, led by board of trustees chair David Miller, quickly began talking with representatives from the Big 12, Pac-12 and ACC.
The Big 12 had proven its willingness to pass SMU on multiple occasions. And with a presence in Texas solidified, SMU could’ve been seen as a redundancy for potential expansion. But for the Pac-12 and the ACC, SMU offered a chance to get into Texas.
For the Pac-12, it wasn’t as cut and dry. The Pac-12 was seeking a media deal that had a heavy streaming component. Ultimately it presented to presidents an offer from Apple that would be just that. Eight schools ultimately deemed it not suitable and fled for other conferences.
A heavy streaming deal at least would’ve questioned SMU’s value, in terms of bringing a Texas audience. But for the ACC, which has a deal with ESPN through 2036, a new top-five TV market and a place in Dallas-Fort Worth could be valuable.
The other wrinkle to SMU’s pitch to the ACC (as well as Stanford and Cal) could be a contractual stipulation. As explained by Bob Thompson, former Fox Sports Network president and Big Ten Network founder, the ACC’s media rights agreement could include an in-market increase for Dallas and the Bay Area. If it did, that could lead to a “significant boost in revenues” for ACC member schools, which could entice them to be in favor of expansion.
It would make sense that a reason SMU has been identified as an expansion candidate is because an “in-market rate” would be triggered by its inclusion.
What else could SMU offer the ACC?
In this negotiation, the ACC has the leverage. Sure, adding more member schools could mean a stronger chance of stability — which shouldn’t be undervalued, considering the way things have gone for the Pac-12 in the last couple weeks — but that might not be a necessity in the immediate future. Adding schools with an in-market rate could also be attractive. But how else could SMU entice member schools to say yes to ACC expansion?
It’s no secret that SMU, with an endowment of nearly $2 billion, has one large bargaining chip. The Mustangs could also pony up money to make their addition an easier decision for the ACC. Or, in this case, simply take less money.
Yahoo Sports reported that SMU would be “open” to forgoing five years of TV revenue distribution to get into the ACC.
People familiar with SMU’s realignment strategy cautioned that but did provide the sentiment they’d be willing and flexible in negotiations with the ACC.
How much would that cost SMU?
Hard to say exactly, but consider what five years without television revenue would look like.
The American Athletic Conference distributed more than $8.2 million to SMU in 2022, according to tax records. If SMU were to leave for the ACC and if it were to forgo five years of media revenue there, it would also be without the TV revenue it would’ve received if it stayed in the American.
That would come out to roughly $41 million. SMU would also have to pay an exit fee from the AAC. SMU would have a quicker exit turnaround than Cincinnati, Central Florida and Houston, so SMU’s exit fee would likely be substantially more than the $18 million those three schools paid.
Could SMU afford that? Surely. Call it an investment.
If not the ACC, then what?
There’s a chance the ACC decides to punt on expansion for the time being. If that happens, then SMU would continue in the American Athletic Conference, which is also eyeing the remaining four Pac-12 schools as additions, according to people familiar with the situation.
The College Football Playoff is set to expand next year, though the potential demise of the Pac-12 could complicate the automatic qualifying system, which included the highest ranked non-Power-Five champion.
There are a lot of realignment questions left to be answered. And if the Pac-12 situation taught us anything, expect that anything could happen — including the potential of SMU to the ACC.