Q/A with Swofford

http://www.newsobserver.com/sports/spt-columns-blogs/luke-decock/article161431703.html

Q. How do you address the revenue gap with the rest of the Power 5 and are there implications for maintaining this level of success if you can’t get closer to the SEC and Big Ten on a conference or per-school basis? The network will obviously help with that, to a degree that we don’t yet know.

A. The channel will help with that significantly. We’re confident of that. ESPN is confident of that. In any significant changes in the world as we know it so to speak in terms of channels and generation of subscription dollars and so forth, if that were particularly negative, that’s not just going to affect us. It’s going to affect everybody else. That’s the route we needed to go for significant revenue generation that doesn’t exist now. There are very few opportunities to take that kind of step, very few avenues to take, and this was by far potentially the most rewarding path we could go down.

Q. Are there any other areas where you can show maybe not that kind of significant improvement, but areas you can target for improvement? Bowls?

A. Bowls, to some extent. We took some steps with our current arrangements and with the College Football Playoff. Maintaining as a league our place at the table, that was critical. That’s significant revenue and that may continue to jump the next time around. I suspect it will, but that remains to be seen. And then you have all of the institutional revenue sources from fund-raising to ticket sales. The revenues from a conference office in terms of type are fairly limited. This is where sometimes it’s a little hard to compare apples to apples. Some conferences are pulling in the institutional multimedia dollars and showing it as conference-generated revenue. We don’t do that. Our schools don’t want to do that. They feel like they’re better off not doing that. There’s no question right now, the SEC and Big Ten there’s a significant gap to the other three. I suspect we’re probably in a better position than sometimes is portrayed because of the accounting of it. We pay all our schools’ expenses for their teams at ACC championships. Sometimes I wonder why we do that, but that’s what we’ve done for years. And yet other conferences put that in their revenue share, they show that as revenue sent to the schools. The gap, right now, is the two.


Q. Do you think that has long-term competitive implications?

A. I think it does to some degree, if it stays that way. I don’t expect it to stay that way. At least in respect to our situation. As I said before, that’s the very reason we’re going on the path we’re going on, and we think it’ll be successful. In terms of a couple of years here, we’re exactly where we expected to be. And we made some decisions – by we, I’m talking about the schools – in terms of what to do with certain revenues. … There’s a difference (in fiscal year 2016) from the previous years because we took the Maryland settlement money and took it immediately instead of leveling it out. And the Orange Bowl money – we could have leveled that out, but the schools prefer the year we’re not in there to forgo it, and when we are in there, take it then. That was all by design. We knew heading into the launch of the channel that there would be some gap with the SEC having started its channel and the Big Ten channel now doing well, after it struggled early, is now doing very well. There are no surprises there.


Q. I mentioned bowls earlier, briefly. When does the process of negotiation new ties begin (the current agreements expire after the 2019 season) and do you foresee any major changes now that Notre Dame was fully integrated into this last round and you may be in a stronger position?

 

A. We haven’t gotten deeply into that right now but I think it’s fair to say that we’re really pleased with most of the partnerships. I think there will be some financial gain to be had when the time comes around. Obviously success on the field for some years is always helpful and I think will be helpful. Will there be dramatic changes? I don’t know. I really like the fact that we’re playing other Power 5 opponents in basically all of our bowls except one that we’re tied into. And the champion of the American in the other. So who we’re playing has improved dramatically. The situation in Orlando is really good for us, tying that in with an additional game when the Big Ten is in the Orange Bowl was a really good step for us. If we can continue to have the competitive success we’ve had over the past four or five years it would give us much more to work with in bowl negotiations.

 

 

 

Q. You were asked about Louisville on Thursday on a couple different occasions but from a more global perspective, obviously they’ve had competitive success in a number of sports since joining the conference, but the issues with the foundation, the basketball investigation, their involvement in Wakeyleaks – do you have any concerns about Louisville’s ability to be a good citizen in the ACC?

A. There have been some things that have happened there, and elsewhere, you know. The Wakeyleaks thing was two institutions and then a third to some degree. But no, I think Louisville has been and is and will be an excellent addition to our league. From my chair, you don’t ever want to see those kinds of issues anywhere, but they happen. Because individuals go down the wrong path periodically. But in terms of the athletics leadership at Louisville and the changes they’re making institutionally and have made in terms of the university’s foundation – it wasn’t the athletic foundation – that’s all been addressed and addressed very emphatically so I think Louisville will be a long-term good and prominent member of the league. You look back over our league’s history we’ve had a number of schools at one time or another that have had problems or issues that are outstanding institutions that have made tremendous contributions to the league. But you’d like not to have any of those issues.


Q. The last 20 years, your time as a collegiate commissioner, have seen tremendous change, and it’s really accelerated in recent years. You haven’t put an end point on your tenure at this time, but after you, at some point in the future, do you have a sense of where things are headed for the ACC and college athletics in general?

A. I know where I hope it’s headed. I hope it’s heading toward a period of recommitment and stabilization, in an ever-changing world of technology and a very fast-moving world, to a recommitment to the collegiate model where there’s the balance of athletics and academics together. I’m still a big believer and will be a big believer that the model can work. I know there are those who will disagree with me but the vast majority of the time, it does work. It is something unique to this country and no other country in the world has it. I think we need to modernize it, in the sense of a changing world, specific to the plight of our athletes. But I think it’s something special to the culture of this country, and it’s something special that gives enormous opportunities to young people, many of whom that wouldn’t otherwise have it. I think we have to be careful not to make every decision based on the elite athlete that has pro potential, but I think we need to recognize that there are those athletes and that’s their path forward in their future life. And that’s a path that only fairly recently became as financially giving as it is now. How do we take that all into account and have the flexibility to modernize it so that the basics of it continue to work for years to come? I think there will continue to be a look at the size of the NCAA, the national organization and what role it continues to have. Whether the gaps in conferences and institutions that play at different levels, whether it makes sense to keep all of them together under one umbrella or not. At this particular time, I still think it does make sense to do that and what we’ve tried to do is find the appropriate subgroups to keep it under one umbrella to try and benefit everybody. Twenty years from now if that’s still possible, I don’t know. I’m not that much of a visionary in that sense.

 

 

 

Q. In a more micro sense for the ACC, as 2023 comes up (when TV deals for the Big Ten, Big 12 and Pac-12 start to expire) and we have the specter of possible changes in alignment, obviously your membership has been secured well beyond that, but do you have any fears of what that might look like over the next six years as there could be some movement? Especially at a time when college conferences have gone from small groups of like-minded schools to larger marketing partnerships.

A. My guess is whatever comes at that point in time, and far be it from me to predict that, I don’t see it affecting the ACC very much. If Notre Dame wanted to take a step to come in football, I think the conference would readily have that conversation. Then you’re maybe looking at a 16th school to have balanced football divisions. Beyond that, my guess is that this league will, in 2035-36, look a lot like it does today in terms of its membership. Elsewhere? I think we’ll just have to wait and see. I never thought our league would be 15 (teams). Seriously. There was a time when I started seeing that there was benefit to that, and not only benefit but necessity. But when I took the job 20 years ago I didn’t see that. I thought maybe 12. And then things happen and things change in the landscape and the marketplace and what you need to do in order to keep the conference at the most prominent level. So those things change. If there becomes this sense of having 20-member conferences-slash-associations, and there are fewer of them, long term I guess that could come into play. In terms of our own membership, and in the period of time you asked me about, that would be my answer in terms of us.