Big Ten Network turning a profit

Is the Big Ten Network the model for sports broadcasting? Here is an AP story on it (key selection below and the entire story follows below that)

AP: Neither the conference nor the Chicago-based cable network publicly talk about their finances, but, according to the Sports Business Journal, three years after it went on the air the network is delivering close to $70 million a year to the Big Ten.

With other conferences including the SEC, Pac-10 and Big East, and even the University of Texas, all talking about potentially forming their own networks, the Big Ten Network is a model for — and some might say the envy of — big-time college sports around the country.

“They have connected a lot of the dots and they are very powerful,” said Christine Plonsky, who is senior associate athletic director at the University of Texas and the school’s point person on its push to create a Texas-only channel.

Why?

Multiply Monigold’s unhappy customers out over millions of households across the Midwest, plus Big Ten fans spread out around the country and, in a nutshell, you can see why the network works and, some experts say, is just getting started.

Cable companies pay the network, on average, 36 cents a month for every subscriber, according to the SNL Kagan, a firm that tracks media business financials. Last year, there were almost 42 million subscribers generating $182.5 million for the network. It brought in $21 million in other revenue, mostly from ads.

According to Kagan, the network turned a 30 percent profit in just its third year, and should hit $272.9 million in revenue and a 36 percent profit in 2012.

Fans, even a relative handful of them, give sports networks like the Big Ten channel real power, Kagan senior analyst Derek Baine said. The 36 cents BTN is paid is actually small compared to some sports channels.

“Most of the regional sports networks get two to three bucks per set per month because you’ve got these rabid fans on there, and if they don’t get their sports networks, they’re going to drop,” Baine said.

And they pay, no matter the season, no matter the programming and no matter whether they’re watching or not.

“I’m having to pay the same amount that I did when basketball season was still going on,” Monigold said in early summer, when the Big Ten’s lineup is dominated by archived football and basketball games and minor sports wrapping up their seasons. (Read more from the AP story below)