Disney Contemplates Future Shift: South Carolina Emerges as Potential New Base

The Walt Disney Company is walking a fine line following the latest developments, and crazy enough, all eyes will soon be on the state of South Carolina.

When thinking about The Walt Disney Company, it’s easy for minds to begin to conjure images of beloved animated characters, enchanting theme parks, and blockbuster movies that have shaped generations. Since its inception in 1923, Disney has become synonymous with family-friendly entertainment, captivating audiences worldwide with its magical storytelling and unforgettable experiences. From timeless classics like Snow White and the Seven Dwarfs (1937) to modern hits such as Frozen (2013), Disney’s animation studios continue to produce cinematic treasures that transcend age and culture, fostering a sense of wonder and joy.

However, Disney’s influence extends far beyond the realm of animation and film. As a diversified entertainment conglomerate, Disney is also the owner of ESPN, a powerhouse in the sports media landscape, but things are shifting in the world of sports.

The ripples started in the state of Florida

When most people think of ripples involving Disney in the state of Florida, their minds immediately go to the battle between Walt Disney World Resort and Florida Governor Ron DeSantis. DeSantis took away Disney’s self-governing rights a couple of years ago, getting rid of the Reedy Creek Improvement District and replacing it with the Central Florida Tourism Oversight District.

But, there’s much more going on in the state of Florida right now that Disney is keeping an eye on than just what’s developing at Walt Disney World Resort.

A few months ago, Florida State University filed a lawsuit in the state of Florida against the Atlantic Coast Conference (ACC) over its grant of rights deal that many within them conference claim is “ironclad.” Hearing of this impending suit, the ACC followed with a suit of its own in North Carolina. Since that point, the two have been awaiting court proceedings with much more on the horizon. In the midst of this lawsuit, it was also revealed that ESPN has a decision to make about moving forward with its media deal with the ACC by February 2025.

With the suit and countersuit on the table, a jurisdiction will need to be reached. This will then likely be appealed, should the cases ever be heard in court at all.

For those who are not aware, this battle between Florida State and the ACC came to a head, particularly, over the conference’s grant of rights deal that, on the surface, makes it impossible for institutions to join another conference. Many of you are wondering why they would want to leave the ACC in the first place. Well, it’s really quite simple: Money.

Both the SEC (ESPN) and Big Ten (Fox, CBS, and NBC) have major television agreements in place that will pay their conference members out much more than the ACC (ESPN) or Big 12 (ESPN/Fox). In addition, the new College Football Playoff television distribution– which will eventually see an increase from 12 teams to 14 teams in just a couple of seasons– will reportedly see the SEC and Big Ten split 58% of the money, while the ACC, for example, will receive just 17%.

With SEC and Big Ten schools already outearning ACC schools by more than $20 million per year– and that number is set to increase in the coming years– and with the new playoff contract in place that will see SEC and Big Ten schools get an increase of around $21 million more, while the ACC will see just $13 million more, it’s easy to see why recognizable football brands in the ACC– like Florida State and Clemson– are looking for a way out.

The ACC’s leadership– with John Swofford at the helm and then Jim Phillips taking over after him– has been nothing short of pedestrian, and as a result, the conference is at serious risk moving forward. This is only amplified by its television deal, which could run through 2036 if ESPN chose to renew.

Disney’s ESPN future now rests in South Carolina

Now, interestingly enough, another lawsuit has formed that will have major implications for ESPN moving forward. Where will the case be heard? In Pickens County, South Carolina.

Clemson University filed a lawsuit against the Atlantic Coast Conference, saying that “Clemson controls its media rights for games played if it is no longer a member of the ACC.” Clemson also attacked the “severe” exit fee penalty imposed by the ACC and said that it does not own any “fiduciary duties” to the ACC should it choose to leave. You can read Clemson’s full statement below:

“Today, Clemson University filed a lawsuit in Pickens County, South Carolina, against the Atlantic Coast Conference (ACC). In this litigation, Clemson seeks confirmation of the plain language found in the Grant of Rights agreements and the related media agreements between the ACC and ESPN – that these agreements, when read together, plainly state that Clemson controls its media rights for games played if it is no longer a member of the ACC. Clemson also seeks a ruling regarding the unenforceability of the severe penalty the ACC is seeking to impose upon exiting members and confirmation that it does not owe a fiduciary duty to the conference as alleged by the ACC.”

The ACC’s position regarding the Grant of Rights, the exit penalty, and obligations owed by members to the conference, as detailed in its public statements and other court filings, leaves Clemson with no choice but to move forward with this lawsuit.

Clemson has not given notice that it is exiting the ACC and remains a member of the conference.”

As expected, the ACC has countersued, but with South Carolina state laws and the fact that Clemson got its lawsuit in first, the expectation is that this case will be heard in South Carolina, assuming that a settlement agreement isn’t reached.

Multiple rumors have come forward that other institutions– most notably the University of North Carolina and the University of Miami– could follow suit in an attempt to ax the grant of rights and open up opportunities for these schools to jump ship, should they have a home elsewhere.

Interestingly enough, though, there’s plenty of vested interest in the state of South Carolina for Disney.

How does this affect Disney?

Some may be wondering: How exactly does this affect Disney?

Well, first of all, the company has a major decision to make in the coming months about potentially renewing its television contract with the ACC, assuming those reports are accurate.

If this is the case and ESPN has an “out,” what would be the reasoning that Disney would want to move forward with a television contract paying the ACC money that might not include Florida State and Clemson, arguably the two biggest brands in the conference?

From a rating standpoint, both Clemson and Florida State bring in more viewership than any other school in the conference. In addition, the two football programs have carried the conference for years– with Clemson winning two of the last nine national championships and competing in six of the last 10 College Football Playoffs. With the two schools not able to come to terms with the ACC, it doesn’t make much sense for Disney and ESPN to continue with a deal that could be blown up at any moment, should the courts rule in the favor of the schools.

Though ESPN has been getting ACC media rights for essentially pennies on the dollar, the company is going to have some eyebrow-raising moments in the coming months, and particularly years, as this saga plays out. Why? There’s competition on the horizon.

There was a point in time when ESPN was the “worldwide leader in sports,” including College Football. There’s no doubt that the company isn’t going anywhere. But, there’s competition on the horizon– especially in the form of FOX– that includes a company that can afford to pay top-dollar and wants to bring major ratings of its own. That’s exactly why the television network signed the Big Ten completely away from ESPN.

With programs like Florida State and Clemson potentially as “free agents,” the last thing Disney wants to see is for those schools to end up in the Big Ten and lose the media revenue that they would’ve otherwise made with the schools under their umbrella. This gives a little extra motivation for ESPN and Disney to see to it that these matters are resolved, and it will be interesting to see what might unfold in the future.

Would ESPN be willing to fork up the extra money in a new deal with the ACC? Would ESPN potentially hand-select schools to come and join the SEC? Would ESPN take the risk of allowing those schools to walk? It’s certainly a dangerous situation to be in if you want to keep your established identity moving forward, especially with the likes of FOX and others nipping at your heels.

What does the future of College Football look like?

Ultimately, there is no exact public blueprint lined out for what College Football will look like in the future, but we do know a few things.

First, the playoff is expanding to 12 teams beginning this year. After that, there are already plans in the works to expand the playoff to 14 teams. At this point, the SEC and Big Ten will wield almost all the power, as they honestly already do.

The lawsuits with Florida State and Clemson, as well as others in the ACC, will likely be tied up for months and, possibly even years. In the end, insiders around the sport agree that the most likely outcome is a settlement of some kind. The ACC will likely reach a financial agreement with both Clemson and Florida State– as well as others who potentially follow after these two schools– and give them a monetary number that will allow them to leave the conference with a clean break.

What that number is? It truly depends on how negotiations go, and how quickly these things move. For example, if ESPN decided not to move forward with its media rights deal with the ACC beginning next year, how could that throw an even bigger wrench into the equation for the seemingly dying ACC? There’s no doubt that the conference has become second-rate, and it’s going to continue to decline, especially once FSU and Clemson find their way out.

In the end, the SEC and Big Ten will likely divide up the schools they want from the ACC– likely Clemson, Florida State, North Carolina, and potentially a couple of others like Virginia, Virginia Tech, and Miami– and the others will be forced to find another league that will take them in, or they’ll have to operate together, likely under a very-much discounted television deal. Of course, this is all conjecture and hasn’t been confirmed.

Ultimately, College Football will be a “Power 2” type of league and the expectation is that the sport will move away from the NCAA altogether. The SEC and Big Ten may continue to allow teams from the Big 12 and depleted ACC to compete, just like the Group of 5 still technically has a bid into the College Football Playoff, but the playoffs will mostly feature teams from these two conferences, and the major money deals will be funneled through them.

There’s likely an aspect of “pay-for-play” that’s also coming down the pike once a split from the NCAA happens that could see athletes as official employees of the school they play at, but that is still likely several years away, and there is still a multitude of challenges to overcome from that perspective. In addition, we have to remember that NIL and tampering are currently running wild in College Football and are only likely to get worse as the NCAA has no plans to stop any of it from happening, and the sport has already turned into what many are calling “the wild west.”

Things are likely to get worse before they get better, but there’s so much change coming to the sport, it may very well be unrecognizable in five years from now.

Regardless of your stance on any of the issues listed above, what truly is astonishing is the significant stake Disney now holds in the sport and how this multi-billion dollar company will be closely monitoring Pickens County, South Carolina, of all places, as it progresses into the future.

This post Disney Contemplates Future Shift: South Carolina Emerges as Potential New Base appeared first on Inside the Magic.