The University of Texas and the University of Oklahoma are changing courses. After reports surfaced that the universities were likely to stay in the Big 12 Conference until the expiration of the conference’s media rights agreement in 2025, the schools, Big 12 Conference, and media networks have reached an agreement for the institutions to join the Southeastern Conference (SEC) in 2024.
To exit early, Texas and Oklahoma will each pay the conference $50 million in exit fees. In addition, Michigan (rather than Texas) will now host the Michigan versus Texas football game scheduled for next season, which allows Fox Sports to broadcast the game. The average payout for SEC schools this season was nearly $50 million and may be greater than $100 million per year by the end of the decade.
When it comes to conference realignment, every exit comes at a cost. With one year remaining before the teams would inevitably exit, the networks owning the rights for each conference worked through a deal that focused on a game swap to offset the cost of Fox Sports losing the rights to broadcast Texas and Oklahoma games.
Conference realignment is not over. The SEC and Big Ten Conference will likely continue the push to expand. However, the cost for an Atlantic Coast Conference school to exit will be much more, considering the current grant of rights agreement binds the schools beyond 2030.
With the exit of Texas and Oklahoma, the Big 12 has shifted its focus to adding more teams. Hanging in the background is the Pac-12 Conference, which is trying to find a partner for a new media rights deal. As conferences produce greater revenues, realignment will continue to churn.