SEC Network Poised to Be Fifth Most Lucrative Sports Channel In Country
I've been writing about the coming value of the SEC Network for years now. Years ago I told you it would be a gamechanger for college athletics, but despite my optimistic outlook this channel is actually going to be even more successful than even I imagined. With the recent announcement that the SEC Network had been picked up by Comcast and Outkick's news that DirecTV would be carrying the network, it's clear that the SEC Network will reach its stated distribution goal of right at 75 million cable and satellite households.
But ESPN and the SEC may be making even more money off the subscription fee than even I've been forecasting. According to the Sports Business Journal Comcast will be paying $1.40 per month in the 11 state SEC footprint. There are roughly 28 million cable and satellite subscribers in the 11 state SEC footprint and another 47 million outside the SEC. Those cable and satellite subscribers outside the footprint will be paying just .25 a month. So the vast majority of the SEC Network money will be coming from SEC fans, which makes total sense. If we accept an average value of $1.40 a month inside the SEC states -- I'd previously projecting around $1.10 -- and .25 outside the SEC states, the SEC Network would do $611 million in revenue off subscription fees alone. I'm going to dive into this number later this week to talk about what it means for the individual SEC schools, but for purposes of this article I decided to contextualize that revenue within the overall sports TV marketplace. (If you want to be more conservative and say they'll average $1.25 in the footprint that's still $541 million).
I contacted SNL Kagan and asked them to provide me with the average cost per subscriber per month for every major national network. Here was the information they provided me. (Note, the SEC Network and Pac 12 Networks are my own numbers based on published reports).
Cost per month for each sports channel per SNL Kagan. (The rankings are also mine):
1. ESPN $6.04 or $72.48 a year
2. NFL Network $1.22 or $14.64 a year
3. Pac 12 Network .80 or $9.60 a year
4. ESPN2 .74 or $8.88 a year
5. SEC Network .68 or $8.16 a year
5. FS1 .68 or $8.16 a year
7. Big Ten Network .38 or $4.56 a year
8. NBATV .27 or $3.24 a year
9. NBC Sports Network .27 or $3.24 a year
10. CBS Sports Network .25 or $3 a year
11. ESPN News .23 or $2.76 a year
12. ESPN Classic .21 or $2.52 a year
13. ESPNU .21 or $2.52 a year
(The Pac 12 Network cost looks way out of line, but it makes more sense when you consider that it's not very widely available. Meaning the average cost is driven up by availabiilty in its target markets).
But then you have to plug in the number of cable or satellite subscribers who are paying for each of these channels. After all, some channels are better distributed than others. When you do that the order changes quite a bit:
1. ESPN: 97 million households $7 billion
2. NFL Network: 72 million households $1.05 billion
3. ESPN2: 97 million households $861.4 million
4. FS1: 88 million households $718.8 million
5. SEC Network: 75 million households $611 million
6. NBC Sports Network: 80 million households $259.2 million
7. Pac 12 Network: 26 million households $249.6 million
8. Big Ten Network: 52 million households $237.1 million
9. ESPN News: 75 million households $207 million
10. NBATV: 60 million households $194.4 million
11. ESPNU: 75 million households $189 million
12. CBS Sports Network: 53 million households $159 million
13. ESPN Classic: 31 million households $78.1 million
Look at that revenue drop off after the top five sports networks. It's extraordinary. The SEC Network is poised to bring in more revenue than the Big Ten Network and the Pac 12 Network combined, with $120 million more to spare on top of that.
Holy hell.
When you factor in advertising -- which typically runs around a quarter of revenue at other ESPN properties -- ESPN and the SEC have almost created an $800 million network. Indeed, add up all the revenue streams here and ESPN is going to be poised to do nearly nine billion dollars just in subscriber fees. Good lord.
And how about the NFL Network? Now that CBS is going to be airing its Thursday night NFL games, how in the world can that fee be justified? The NFL Network is by far the worst deal for sports fans on this list.
My point in putting all this out here -- the SEC Network is going to be even bigger and more successful than I thought. The SEC Network is now the most successful new sports cable launch and it's still a month away from the launch. And, amazingly, most fans and media still haven't realized the impact it's going to have. You thought the SEC had a competitive advantage before? You ain't seen nothing yet.