An enticing membership invitation has been extended to the Big 12 by Memphis, a move deemed substantial enough to warrant a meeting of league presidents this past Monday for discussion. Nevertheless, current sentiment suggests that the proposition might not garner the necessary backing, at least for the time being.
The offering put forth by Memphis, recognized as one of the more ambitious membership proposals seen in collegiate athletics, includes financial commitments from UM-affiliated corporate entities amounting to hundreds of millions of dollars for the Big 12. Moreover, the university proposes to waive its share of revenue distribution from the league for a minimum of five years.
Multiple sources, who preferred to remain anonymous, provided insights to Yahoo Sports regarding the proposal. This endeavor signifies the latest and most significant effort by the university to transition from the American Athletic Conference to a prominent power league.
The groundwork for this specific endeavor began over a year ago. Bill Hardgrave, the president of Memphis, has invested no less than 14 months engaging with the presidents and leading athletic directors of numerous Big 12 institutions. These interactions have taken place in individual, on-campus settings, culminating in a membership offer to the league that could potentially reach $200 million over the next five years.
Authorities within the Big 12 are presently evaluating the proposition; however, several conference officials have indicated to Yahoo Sports that it lacks widespread support within the league. Securing any expansion requires the endorsement of a super majority of the league’s presidents and chancellors, specifically 12 out of the 16 members. In recent days, a more comprehensive version of the Memphis proposal has been circulated among athletic administrators within the conference.
Throughout the preceding 18 months, the conference has meticulously considered two expansion proposals, one from Gonzaga and another from UConn. Despite the consideration, neither proposal managed to secure the necessary level of support. While this current effort is considerably more financially rewarding, it still encounters obstacles.
“It’s uncertain whether sufficient backing exists,” a leading figure within the Big 12 confided to Yahoo Sports during the weekend.
“Memphis underwent evaluation during the inclusion of Cincinnati, UCF, Houston, and BYU, yet a decision was made against their addition,” another Big 12 administrator pointed out. “What aspects have since shifted?”
Regardless, the proposal’s attractiveness has led to weeks of review by the conference. This comes at a time when Big 12 leaders are working to compete with the Big Ten and SEC, both of whom have more valuable television deals and revenue distribution, causing financial strain. Timing is crucial; on July 1, college athletics entered a new age in which universities are able to compensate athletes through a capped revenue-sharing system.
The financial stakes in the industry have reached an all-time high. Already, Big 12 schools are generating around $1 million in added income through a sponsorship arrangement with PayPal. With contributions from UM partners, the Memphis proposal would have amplified this figure by at least $2 million. The university maintains established ties with entities like FedEx, Lowe’s, and AutoZone.
The Memphis proposal is characterized as a “no-risk” concept, as noted by sources within the Big 12. It may also introduce a benchmark for expansion fees required for league entry. The framework entails the school: forfeiting revenue distribution for the concluding five years of the league’s novel television agreement with ESPN and FOX; supplementing the league with sponsorships exceeding $150 million over five years; and being subject to expulsion after 2030-31 if the Big 12 assesses its value to be insufficient.
This significant offer showcases an unprecedented moment in the history of collegiate sports, where a school is effectively purchasing its way into a conference. This move further builds on a precedent established by SMU’s entry into the ACC. Although SMU committed to forgo league revenue within the ACC for a specified period, it did not arrange sponsorship deals in the millions for the benefit of the league.
Memphis’s considerable offer highlights the school’s steadfast ambition to rise to the level of a power conference, a pursuit it previously attempted with the ACC some years back. Under the leadership of Hardgrave and the new athletic director, Ed Scott, the school has notably increased its investment in recent years, bolstered by financial backing from sponsors like FedEx and Lowe’s.
According to statements made by UM officials to Big 12 leaders, the full $20.5 million in revenue sharing is expected to be distributed to athletes by the following year, facilitated by a large gift from FedEx. Any departure from the American Athletic Conference would entail another substantial expense, with the exit fee anticipated to be at least $25 million, a sum similar to what SMU remitted upon its departure last year.
The future direction of Memphis remains uncertain. Representatives from the Pac-12 have conveyed genuine interest in the program, even presenting the school with a term sheet the prior year, which Memphis leaders declined. Moreover, Memphis officials have engaged in discussions with leaders from the Big East regarding the potential relocation of their basketball program.
