ACC settling lawsuits provides short-term stability, but conference realignment still lingers down the road

Tuesday’s news that the ACC and member schools Clemson and Florida State dropped their lawsuits against each other was both anticipated and yet one of the more dramatic reversals in recent memory. 

There was a time not long ago that it felt like a matter of when, not if, Florida State and Clemson would leave the ACC. The public legal battle between the conference and its two schools had cast a pall over everything the ACC did, forcing commissioner Jim Phillips to address it at seemingly every major conference event. 

Florida State, Clemson and the rest of the ACC schools voting Tuesday to end the four lawsuits and introduce a new revenue distribution system is only one piece of the puzzle, however. 

There are a lot of potential ramifications of this decision, both for the conference in the short term as well as future realignment. 

What does this mean for the ACC now?

In the short term, at least, this is a win for all involved. The ACC no longer has to deal with the negative headlines of two of its premier brands suing it, with one even accusing it of pushing the conference to its brink. The lawsuits threatened to expose sensitive information and, even more impactful, could have led to easy exits for multiple ACC schools if Florida State and Clemson had won the crux of their arguments. 

For the schools, the revamped revenue distribution will put greater emphasis on television ratings. Florida State athletic director Michael Alford introduced a similar concept two years ago, and if FSU and Clemson receive a bigger cut moving forward, as expected, it can help placate the concerns driving the lawsuits which were that the conference’s annual payout was falling way behind that of the Big Ten and SEC. It could lead to a reported extra $15 million annually for the conference’s top schools, a not insignificant amount especially in light of the expected $20 million revenue share which should begin this summer as a result of the House v. NCAA settlement. 

For smaller ACC schools, it’ll be a financial hit at an unfortunate time, but the unequal revenue sharing should provide stability for at least a few years. No one wants to end up like the Pac-12 did.

What does this mean for future conference realignment?

Realignment rumors are never going away, and even Tuesday’s settlement news doesn’t change that. 

Florida State and Clemson were always confident there’d be a spot for them in a premier conference should they leave the ACC, while sources inside the SEC especially expressed doubt that an invite would ever be extended. Those differing viewpoints were never truly tested but could be again next decade when multiple television rights deals come up which insiders believe may ignite another round of realignment.

The Big Ten’s TV rights deal ends in 2030, the College Football Playoff’s ends in 2032 and the SEC’s long-term deal with ESPN ends in 2034. If precedence is any indicator, all three should be incredibly valuable, and with the conferences especially, there will be schools jockeying to to cash in on the next multi-billion dollar TV deal. 

In exchange for dropping their lawsuits, the ACC agreed to put a number on how much it’d cost to leave the conference — $165 million to start, according to Clemson’s board presentation — with that number descending to $75 million in 2030. If, for instance, the Big Ten would like to add Florida State and Clemson ahead of its next TV deal, the two schools should now know exactly what it would cost to leave the ACC. That brings clarity and yet also future concern. 

The crown jewel within the ACC, as CBS Sports has previously reported, is still North Carolina, which could have its pick between the Big Ten and SEC should it ever want to leave the conference it helped start. UNC might be one of the biggest winners of this entire development where it didn’t have to publicly fight with the conference and should greatly benefit under the new revenue structure now that Bill Belichick is in Chapel Hill. Miami, another school that could have interest elsewhere, is also a winner in that department. 

This move could be the glue that keeps the ACC together for a long time. Or it could be a short-term fix to buy everyone some more time and build out additional contingency plans should schools leave the conference. Time will tell. 

Will more unequal revenue sharing be coming?

The ACC moving to a new revenue distribution that emphasizes television is actually a concept that’s already been deployed in college sports. 

The Pac-12 used to do the same, financially rewarding the schools that appeared on television the most, allowing the Los Angeles-based schools — USC and UCLA — to greatly benefit. Eventually, the other Pac-12 schools got frustrated with the unequal revenue sharing and came up with a plan to stop it. 

When that plan was revealed, then-USC AD Pat Haden threatened to leave the conference if his school didn’t receive a greater cut of the financial pie. It’d be more than a decade for that threat to be realized, but eventually, USC and UCLA left for the greener pastures of the Big Ten. That started the implosion that ultimately toppled the Pac-12 leaving only Oregon State and Washington State. 

Chris Hill, the former long-time Utah AD who was in the room when Haden made his threat, said not giving USC a bigger cut proved to be a fatal error. 

“We should have woken up and said this is unique,” Hill said in The Price: What It Takes to Win College Football’s Era of Chaos. “We have one market that dominates and we need to recognize that and give them more money since we’re all making a lot more money and accept that. We didn’t do that. At the end of the day, that was a big mistake.”

The ACC learned from the Pac-12’s missteps, with schools realizing taking a financial hit to keep the conference together is better than the alternative. The bigger question is: Will other conferences have to follow suit?

The chatter has continued to increase within college sports circles that the Big Ten and SEC could find themselves in this predicament one day, though conference sources have pushed back on that narrative in the past. But, the theory goes, what happens when schools like Alabama and Texas decide they deserve a bigger cut than Mississippi State and Vanderbilt? Or Ohio State and Michigan saying we want more than Purdue and Rutgers?

Will they need to sue and/or threaten to leave the way Clemson and Florida State did? Or would the conference recognize, as the ACC has now, that those programs bring additional value and deserve a bigger cut of the money. If not, there is the fear that the top brands will ultimately band together, break off to form the long-discussed super conference and leave the smaller schools behind. The theme of the 2030s could be consolidation rather than the realignment that has enveloped the sport in recent years. 

“Wouldn’t it be better if we could increase the size of the pie and shrink the number of pieces?” former NCAA president Mark Emmert told me last year. “Because of the self-interest thing, they are more than happy to raid each other’s conferences, but sooner or later, they are going to have to turn on each other.”