University leaders have reached an agreement on a new contract for the College Football Playoff.
Executives from the 10 FBS conferences and Notre Dame on Friday agreed to a new contract with ESPN starting in 2026, agreeing to a new revenue-sharing model and protections related to the future playoff format. The news was expected after the Big 12 and ACC presidents voted Wednesday to authorize commissioners to adopt a new framework. Both councils were seen as the most reluctant to agree to a financially unfavorable framework.
Notre Dame's conference commissioners and leaders signed a memorandum of understanding regarding revenue, format and a new deal with ESPN, a concept previously reported by Yahoo Sports.
The new television deal with ESPN extends for six years through the 2031 playoffs and will pay CFP $1.3 billion annually, about three times the amount the network distributed for the four-team version. These numbers were reported by ESPN itself in a January article.
The format of the playoffs is not expected to be determined until a later date, but protections and guarantees related to a 12-team or 14-team format are part of the agreement. The champions of the four major conferences and the highest-ranked Group of 5 earn automatic berths to the playoffs.
Notre Dame is expected to put in place its own protections related to the format. The Irish can earn a guaranteed at-large spot based on their CFP ranking. However, that guarantee depends on the number of autoqualifiers in the finalized form.
How to distribute the funds has been an intense and sometimes contentious process among conference committee members, with discussions beginning in earnest about six months ago.
As detailed in a Yahoo Sports article last Friday, the new revenue-sharing model is heavily weighted towards the Big Ten and SEC. Under the previous structure, the five major conferences would split 80% of CFP's $460 million in revenue roughly evenly.
Together, the Big Ten and SEC will earn about 58% of CFP's base distributions (29% each). This number would significantly exceed the combined ACC and Big 12 distribution, which is expected to be about 32%. The ACC gets 17.1% and the Big 12 gets 14.7%. The remaining amount (approximately 10%) will be split between Notre Dame and 5 teams in the Group of 64.
The difference in distribution between the two conferences, the SEC/Big Ten and ACC/Big 12, could exceed $300 million. The Power Two is expected to earn a total of more than $700 million, far more than the ACC and Big 12's roughly $400 million. Approximately $115 million will be allocated to Group 5.
No school's revenue will decrease as ESPN's distribution increases. Major conference schools currently receive approximately $6 million in distributions from the CFP. He'll be in the low $20 million range, triple if not quadruple the annual distribution of SEC and Big Ten schools. ACC and Big 12 schools are expected to receive more than double their previous amounts. Independent universities, Washington State and Oregon State will receive a portion of the money.
Notre Dame maintains its place in the CFP's governance structure and is one of the sport's historical powerhouses, doubling its distribution to $12.5 million annually, but with financial bonuses. There is a caveat that it is included. The four independents are eligible to receive performance dividends. Notre Dame and other independent teams will each receive a flat fee of $6 million if they make the playoffs.
Notre Dame is also the only major conference school that cannot withstand the financial impact of losing millions of dollars in payments from bowl contracts. The SEC, Big Ten, Big 12, and ACC all have lucrative bowl affiliation deals in place, especially with the Rose Bowl, Orange Bowl, and Sugar Bowl.
With the exception of the provisions regarding independent players, the current performance distribution structure, which previously applied to all teams, has been abolished in this contract.
CFP's revenue-sharing model was primarily based on its historic playoff success over the past decade. Considering future realignment moves, the SEC and Big Ten will account for 72.5% of CFP participants. When you factor in Oklahoma State and Texas, the SEC leads all conferences with 17 teams in a four-team field. Next, the Big Ten will have 12 schools, considering the four new schools. The ACC (seven teams) and Big 12 (two teams) follow.
The deal was to include a final “look-in” clause that would allow for a reassessment of revenue allocation and format in 2028. Look-in provisions may be triggered early by rescheduling the meeting.
Formal formatting may take weeks or months to come.
The format for 2024 and 2025 is set up as a 5+7 12-team model, with the five highest ranked teams receiving automatic spots and the next highest ranked teams receiving seven at-large spots. The revenue model for the next two years will also be set based on the previous formula. There is an increase from the original four-team playoff. The expansion from four teams to 12 teams automatically increased allocations by a total of $460 million in 2024 and 2025.
As well as having a high revenue share, the SEC and Big Ten are expected to have significant weight in determining the format starting in 2026. 14 A variety of team formats continue to circulate throughout the industry.
One of the models being considered is a 5+9 model that mirrors the current 5+7 12 team format, but with two additional at-large spots. The possibility of multiple automatic qualifiers in individual leagues still exists, including three automatic qualifiers each for the SEC and Big Ten, two each for the ACC and Big 12, and the highest-ranked Group of Five programs. includes a format that grants one automatic qualifier. at-large spot — 3-3-2-2-1+3 model.
A 2-2-1-1-1+7 model is also being considered. This gives them seven automatic spots: two each in the SEC and Big Ten, one each in the ACC and Big 12, one each in the highest-ranked Group of 5, and seven at-large spots.
As Yahoo Sports reported last Friday, the idea of the Big Ten and SEC retaining exclusive rights to two first-round byes has received enough backlash that it has been put on hold, at least for now.
Money is more important.
Revenue matters more than ever. Major conferences and their members are preparing for future athlete compensation models. This concept requires securing extra cash flow for players, whether through employment, revenue sharing or collective bargaining.
The league is also at risk of incurring billions of dollars in retroactive NIL payments and television distribution as a result of several ongoing antitrust lawsuits.
