The Business of College Sports

[The Eagle's Cliff]

Below is a link summarizing revenue and profits of the biggest football and basketball schools. It's a good reference for Conference discussion:


http://businessofcollegesports.com/2011/06/20/which-football-and-basketball-programs-produce-the-largest-profits/

[darell1976]

Minnesota #25??? They get beat by South Dakota and NDSU...twice!!! I think its time to invest in more money or else do something constructive with it like hire a good recruiting coach because their players can't play worth a damn.

[Lehigh Football Nation]

Breaking this out by sport is incredibly misleading. While UT's football program makes a "profit" of $68 million, there are dozens of other UT sports that are net revenue losses. It also doesn't include "institutional support" for the entire athletics department, either through student fees, institutional transfers, or both.

That's not to say UT's athletic department loses money. It's probably one of a couple dozen that doesn't. But it's like saying General Motors is "profitable" because the Volt's sales went up 100%. It's only a tiny part of the overall picture.

[MplsBison]

http://www.usatoday.com/sports/college/story/2012-05-15/texas-athletics-spending-revenue/54960210/1

[Lehigh Football Nation]

"There's nothing to stop Texas or other very successful financial enterprises with these gigantic television contracts from continuing to grow, grow, grow because their revenues match their expenditures," says former Arizona President Peter Likins, who several years ago headed a high-level NCAA panel that examined the cost of college athletics. "But the disconnect between what's happening in athletics and what's happening elsewhere in the same universities creates stress, and … the stresses will create a breakdown."

That's from the Hon. Peter Likins, president of Lehigh when I was an undergraduate there.

[BisonHype!]

That sucks for the programs running in the red! Texas is just rolling in that dough!

[ngineer]

That's from the Hon. Peter Likins, president of Lehigh when I was an undergraduate there.

Likins was one of the main leaders in creating the Patriot League as the 'model' of what college sports should emulate--where the athletes are to reflect the student body as opposed to being just mercenaries to be chewed up and spit out after four years.

[BlueHenSinfonian]

That's from the Hon. Peter Likins, president of Lehigh when I was an undergraduate there.

A lot of people may agree that the biggest schools are out of control when it comes to football, but how can it be stopped or regulated at this point? NCAA membership in voluntary, and the BCS 'Championship' isn't run by the NCAA. The FCS Championship is the official NCAA recognized Division 1 football championship process, but the general public doesn't seem to care. The NCAA still runs the basketball championship, and I've long felt that the NCAA should leverage that to force ESPN and the networks to give the FCS playoffs and championship game equal promotion to the BCS series at the risk of losing the ability to broadcast the basketball tournament, but apparently no one at the top of the NCAA has the balls to make that ultimatum.

At this point only government regulation can do anything, but how would that come about? It's the worst kept secret in the world that many of the players in the top FBS conferences aren't held to the same academic standards as the average students at those schools. Would an oversight committee funded through a percentage of profits in the BCS system to insure that all student athletes are held to the same standards and expectations work? Should schools be penalized for students that leave before graduation for the NFL or NBA draft (personally, I think yes)? The APR system might have been a good idea at the start, but in practice it just penalizes the schools who take it seriously or those who don't but don't have the resources to properly circumvent it.

[Lehigh Football Nation]

A lot of people may agree that the biggest schools are out of control when it comes to football, but how can it be stopped or regulated at this point? NCAA membership in voluntary, and the BCS 'Championship' isn't run by the NCAA. The FCS Championship is the official NCAA recognized Division 1 football championship process, but the general public doesn't seem to care. The NCAA still runs the basketball championship, and I've long felt that the NCAA should leverage that to force ESPN and the networks to give the FCS playoffs and championship game equal promotion to the BCS series at the risk of losing the ability to broadcast the basketball tournament, but apparently no one at the top of the NCAA has the balls to make that ultimatum.

At this point only government regulation can do anything, but how would that come about? It's the worst kept secret in the world that many of the players in the top FBS conferences aren't held to the same academic standards as the average students at those schools. Would an oversight committee funded through a percentage of profits in the BCS system to insure that all student athletes are held to the same standards and expectations work? Should schools be penalized for students that leave before graduation for the NFL or NBA draft (personally, I think yes)? The APR system might have been a good idea at the start, but in practice it just penalizes the schools who take it seriously or those who don't but don't have the resources to properly circumvent it.

A lot of good points and ideas here.

One "thermonuclear" option that has come about at times is government action in the form of removing schools' tax-exempt status with the idea that their money-making sports are a profit that needs to be taxed rather than something that is revenue positive for the "greater good" of education. But cynically, it seems like the only time it gets brought up is when a particular school is going to get screwed over with lack of BCS access (Utah, BYU) or will lose out in realignment (Iowa when Iowa State was going to have to leave the Big XII). Broadly speaking, the bowl system and college athletics system is so much of a revenue producer for all these states, it still seems unlikely that anyone will seriously try to maim the system, unfortunately.

If government regulation comes about - something I would welcome - I think it would have to come about based on some form of higher ground. Some form of proof that runaway TV contracts are actually bad for the athletes in the sports in question. Personally, I think that they are, based on the idiocy that has come from realignment, like Boise State in the Big East, Pitt in the ACC, etc. that causes a lot of extra headaches for the athletes and administrators, not to mention the fans. Also, it's the schools and conferences that benefit much more materially from the TV contracts than the athletes. Some say they should share in the revenue, but I think the revenue should all go through the same clearinghouse, somehow, and go towards scholarshipping all athletes, whether through the NCAA or some other organization.

Some seem to think (like Joe Nocera of the NYT) that a player's union for college athletes is the answer, but I am pretty cold towards that idea. Taking the money from the schools and instead pumping it into the union doesn't benefit the students as much as it benefits the union.

My caveat is that I'm no lawyer, but I'm just trying to come up with something sensible and fair. Maybe it's a start.

[crossfire07]

I personally do not want the goverment involved in a damn thing to do with college football.

[Dane96]

A lot of good points and ideas here.

One "thermonuclear" option that has come about at times is government action in the form of removing schools' tax-exempt status with the idea that their money-making sports are a profit that needs to be taxed rather than something that is revenue positive for the "greater good" of education. But cynically, it seems like the only time it gets brought up is when a particular school is going to get screwed over with lack of BCS access (Utah, BYU) or will lose out in realignment (Iowa when Iowa State was going to have to leave the Big XII). Broadly speaking, the bowl system and college athletics system is so much of a revenue producer for all these states, it still seems unlikely that anyone will seriously try to maim the system, unfortunately.

If government regulation comes about - something I would welcome - I think it would have to come about based on some form of higher ground. Some form of proof that runaway TV contracts are actually bad for the athletes in the sports in question. Personally, I think that they are, based on the idiocy that has come from realignment, like Boise State in the Big East, Pitt in the ACC, etc. that causes a lot of extra headaches for the athletes and administrators, not to mention the fans. Also, it's the schools and conferences that benefit much more materially from the TV contracts than the athletes. Some say they should share in the revenue, but I think the revenue should all go through the same clearinghouse, somehow, and go towards scholarshipping all athletes, whether through the NCAA or some other organization.

Some seem to think (like Joe Nocera of the NYT) that a player's union for college athletes is the answer, but I am pretty cold towards that idea. Taking the money from the schools and instead pumping it into the union doesn't benefit the students as much as it benefits the union.

My caveat is that I'm no lawyer, but I'm just trying to come up with something sensible and fair. Maybe it's a start.

You hit on two of the options:

1. Taxation
2. Antitrust

The third, and easiest option is the following:

COMMERCE CLAUSE.

This very simplistic, and often abused, theory/regulation is what got the State of Louisiana to play ball and raise the drinking age to 21. We withhold your funding for roads...unless you change the drinking law, which is loosely tied to the roads.

Universities--both public and private--receive federal funding in one shape or form. Put a noose on that until the NCAA reforms...and you have your governmental rule...or intrusion as some would likely call it.

[crossfire07]

I still don't understand why we need the federal government involved in the free enterprise system of college football. Good luck trying to get something like that out of committee much less to any floor. I suppose y'all send weekly emails to your schools presidents about the concerns.

[MplsBison]

I still don't understand why we need the federal government involved in the free enterprise system of college football. Good luck trying to get something like that out of committee much less to any floor. I suppose y'all send weekly emails to your schools presidents about the concerns.

Hey Ron Paul, aren't you busy running for the Libertarian presidential nomination?

[crossfire07]

Yes I am Barack. The people that I represent tell me everyday of how you can take your share the wealth ideals and take them straight to hell with you :)

[MplsBison]

It's too bad the tea party didn't gain enough traction to become a legitimate 3rd party.

People voted for a lot of fake republicans in 2010 who are really libertarians, but lied to people saying they were republicans of the old kind. Then those voters figured out "hey wait a second, were did all the funding for the street lights go?!"


It's a fringe ideology. That's why it never has and never will be a real party, not enough people genuinely believe in it. Therefore, you don't deserve to be heard. Except on the internet, of course.

[dgtw]

I personally do not want the goverment involved in a damn thing to do with college football.

How much money does the state of Louisiana spend on football and other athletic programs? If you don't want them telling you what to do, don't take their money.

[Dane96]

I still don't understand why we need the federal government involved in the free enterprise system of college football. Good luck trying to get something like that out of committee much less to any floor. I suppose y'all send weekly emails to your schools presidents about the concerns.

101- It's not "free enterprise" if the government is spending cash on you. That's not political...it's a fact. It means they hold some cards in how your business is run. My company deals with it every day, and we are a 140 year old family owned and operated internationally based corporation.

[Dane96]

How much money does the state of Louisiana spend on football and other athletic programs? If you don't want them telling you what to do, don't take their money.


THIS!!!

[MplsBison]

101- It's not "free enterprise" if the government is spending cash on you. That's not political...it's a fact. It means they hold some cards in how your business is run. My company deals with it every day, and we are a 140 year old family owned and operated internationally based corporation.

No crap.

I'd love to see "free" enterprise run smoothly without roads to ship your products on or police protections from thieves raiding your factories. Yeah, then you'd really be free!

[The Eagle's Cliff]

There's really no question that the Bowl Championship Corporation violates Antitrust laws. The six Auto-qualifying conferences (and Notre Dame) are given unfair access to the revenue and publicity of the BCS. That would be OK if the Bowls weren't non-profit organizations which are tax exempt. Several stories have been written and broadcast about the inflated salaries of Bowl committee members and other "expenses" that divert the Bowl revenue to everything except the participating schools and charity.

I believe College Football for the Top 15-20 revenue schools is a business and should therefore be taxed as a business and the players paid. This will never happen so the only thing the have-nots can do is position themselves strategically under the table to get their share of the crumbs or risk obscure starvation. This is especially true for Directional/Regional U's who compete with Big State U for allocated resources and market share just to provide the basics.

[crossfire07]

How much money does the state of Louisiana spend on football and other athletic programs? If you don't want them telling you what to do, don't take their money.

I said that in response to someone wanting the goverment to take money away from the schools that have it and give it to those who are in debt up to their *** because they are in a division of football they can't compete in, on the field or money wise so in that context, no, I do not want the goverment involved doing that.