When Florida State athletics was courting private equity money in August 2023, the school built out a 28-page model projecting its finances through 2043. For revenue from conference media deals, the department’s biggest source of income, the Seminoles projected $44.4 million in 2024 and $49.9 million in 2025, followed by a large jump to $78.9 million in 2026.
I first saw the document in January 2024, shortly after the school’s board voted to try to sue its way out of the ACC. It seemed clear at the time that Florida State officials believed one of two things would happen: 1) The Seminoles would leave the ACC for a richer conference, or 2) The ACC would agree to give it a much larger share of its ESPN TV deal.
This week the school negotiated its answer—the latter—via a wide-ranging settlement with its current league. In exchange for dropping their lawsuits and their active attempts to bolt for greener pastures, Florida State and Clemson (and the rest of the ACC) have agreed to a new revenue distribution model that will reward the members that drive the most viewership. It’s a concession not just to FSU and Clemson but also to a handful of other ACC schools, such as UNC and Miami, that might also have entertained new leagues in the coming years.
According to a slide presented to Clemson trustees on Tuesday, the ACC will take 60% of its base payment from ESPN and roll it into a Viewership Pool. That money will then be distributed to schools proportionally based on five-year rolling viewership figures in football and men’s basketball. If Clemson represents 10% of viewership, the Tigers will get 10% of the money. The school projects that the new structure could bring it an additional $120+ million in revenue over the next six years.
It’s a temporary solution to the ACC’s problems, but also a template for leagues like the SEC and Big Ten. Both are approaching $1 billion in annual revenue and feature some of the sport’s most dominant football brands (Texas, Ohio State, Georgia) and also handful of much smaller programs (Rutgers, Vanderbilt, Purdue). That mattered less a decade ago, when college sports was big business but with virtually free labor and no profit motive. Today, as schools prep to pay players and investors dream of a future “super league” that includes just the NCAA’s most valuable teams, it’s become a looming challenge.
In the last few years I’ve asked many people at the major conferences—ADs and commissioners—about when they think their leagues will get around to booting their least valuable members. The response is always the same: “Never.”
Never is laughable in this industry, but tiered revenue sharing is a way of addressing this imbalance without the more nuclear option. If Texas and Georgia were to really push for a bigger piece of the SEC revenue pie, it would be hard for Vanderbilt to retain its share. Teasing the idea out further, we may not be far away from a multi-tier leagues—A division and B division—or from conferences using revenue sharing percentages as a lever to nudge less-valuable schools elsewhere. (A rep for the Big Ten declined to comment on the future of the league’s revenue-sharing policies. A rep for the SEC didn’t respond to a request for comment.)
Tiered revenue sharing isn’t totally unheard-of in college sports. Every conference divvies up its revenue streams differently—and while most share the biggest commercial income evenly, there are circumstances where that changes. We’ve seen schools agree to reduced payments when they’re new to a league, for example, and the SEC is one of a number of leagues that awards more College Football Playoff money to the schools bringing it in (the ACC just agreed to something similar as part of this settlement).
Boise State for a long time was able to leverage its larger profile as a way to get more Mountain West TV money than its peers. But the ACC is the first to enact such a variable structure among the major conferences.
For the past 18 months, I have been talking about Florida State’s athletic department as the poster child for the modern college sports money panic. The school was early in its talks with private equity, lent money internally to its athletic department, and eventually issued $327 million in revenue bonds to finance stadium construction. The Seminoles were robbed of a CFP berth, sued to exit the ACC, and are now replacing a legendary basketball coach who abruptly retired amid an NIL lawsuit.
A lot of people are interpreting this week’s settlement as a sign that Florida State and Clemson will stay in the conference until the grant of rights expires in 2036, but that’s far from certain. It’s not mentioned in the six-paragraph press release announcing the settlement, but the sides also agreed to a reduced exit fee moving forward. The current structure calls for a fee that rises over time—3x the ACC’s per-school payout, a total that is roughly $165 million in 2025-26. The new fee, according to the slides shown to Clemson trustees, will start at that number in 2025-26 and reduce it by $18 million each year, until it hits $75 million in 2030-2031. It would remain $75 million through 2036.
As Yahoo Sports pointed out this week, that 2031-36 stretch will be critical. The Big Ten’s media deals are up in 2030, followed by the Big 12’s the following year. The NCAA’s $8.8 billion March Madness agreements with Turner/CBS are up in 2032, as is the CFP’s $7.8 billion deal with EPSN.
No telling what college sports will look like by then, but it won’t look like this.