Penalty dollars helped save the Little 12?
CNBC reports: “Perhaps one of the most understated appeals — the promise of some nice penalty cash from Colorado and Nebraska. Originally speculated as a $10 million penalty, it looks like the Big XII thinks they are entitled to much more. Beebe says that the lawyers have led him to believe that they can withhold 80 percent of the money that Colorado and Nebraska would make in the next two years. That includes one year in the Big XII, where the two teams combined will earn at least $14 million. And one year in the Pac-10 and the Big Ten, where the money made will depend on exactly how much of a first year share the teams will be getting.”
According to the report, Texas, Oklahoma and Texas A&M were the chief beneficiaries of the penalty funds in the deal. Of course, what happens when the penalty money expires? Will the television partners really pay for the reduced product the Little 12 offers?
Update: Sports Business Daily says FSN is willing to pay more in exchange for additional rights. According to the report, “But sources say FSN has told Big 12 officials that it would increase its annual payout to as much as $130-$140M per year. It currently pays $19.5M per year for the cable TV rights, a deal that ends following the ’11-12 season.”