This is not sustainable

[Scioto]

Eye opening article from the Chronicle of Higher Education. http://chronicle.com/article/As-Sports- ... NIY0hEcGpz

There are 347 D1 college athletic programs. A 2011-2014 study shows that only 40 of those 347 programs give revenue to their schools. Of those 40, only 10 give back more than they receive in "subsidies" from their schools. Texas and Ohio State athletic departments blow every other school away giving to their respective schools $37 million and $36 million, respectively, while receiving nothing back as a subsidy. These athletic departments are fully self-sustaining. Alabama's athletic department gives $25 million, but gets back a subsidy of $23 million for only a net $2 million.

Florida gives $25M and receives back $18M, UK gives $8M and receives a subsidy of $3M, and Michigan gives $7M/receives $1 M. LSU, Oklahoma, Nebraska, and Purdue give $19M, $11M, $10M, and $4M, respectively, and get back $0. That's it. The other 337 D1 athletic departments take more than they give. Not one ACC or PAC 12 athletic department gives more than it receives. Notre Dame takes more than it gives the school. Only 4 of 14 B1G and SEC athletic departments and only 2 of 10 Big 12 give more than they take back.

It will be interesting to see if the study gets updated in a few years since the SEC Network started broadcasting in 2014 and the study covered 2011-2014 (B1G Network started in 2007). But, I just don't see how all of this is sustainable. And, although the best football is played in the SEC, that simply will not last. It takes money and lots of it to sustain that run. I predict we will increasingly see the ACC and PAC 12 left behind (it's simply looking bleak for those conferences) and the Power 3 (SEC, B1G, and Big 12) increasingly will become two or three tiers of the haves, the have nots, and the basket cases and the jury is out on Alabama, Tennessee, Ole Miss, Auburn, etc.

 

[baddnole]

You are correct OHVATN. Unless FOX sports or another gives ESPIN some competition ,sports and conferences as we know them will not exist. The best thing would be for Disney to pull the plug on ESPN. FSU and others,Clemson,N Carolina and a couple more will survive,but will move to another league. :tu:

 

[Zulu]

I think that you're right regarding the SEC network -- the 2014 figures show that each SEC school received $31.2 million from the network, and they're expecting a BIG increase when the 2015 numbers are final. That's game-changing money (pun intended). I don't see how a conference can expect to remain Power-5 without its own network.

 

[Anonymous]

It is sustainable all the College Campuses I've been on have construction going on all over the place. They have plenty of student and tax dollars. Colleges and the politicians running them are making money hand over fist.

 

[mtn cur]

he's just stirring. SEC is King of the World and people like him wanna drag it down

 

[Scioto]

he's just stirring. SEC is King of the World and people like him wanna drag it down

Keep living in your world of denial. It's easier I know. The OP was not aimed at the SEC, but you probably didn't even bother to read the article. Alabama's athletic department must be subsidized by the larger university, but it's at least one of only 10 such departments who gave more than it received from the university from 2011-2014. Still, in a state that is the third least educated state in the United States (ahead of only Mississippi and West Virginia) and a state where 1 in 4 adults are functionally illiterate, the question I present on sustainability is highly relevant to any "fan" of a football team. As the fiscal conditions of the states continue to be stressed by rising health care costs, retiree pension obligations, and the next economic recession (i.e., reduced tax collections), the success of college athletic programs and their teams that cannot sustain themselves will be increasingly called into question.

 

[mtn cur]

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[Zulu]

Keep living in your world of denial. It's easier I know. The OP was not aimed at the SEC, but you probably didn't even bother to read the article...

I know this wasn't aimed at me, but I DID try to read the article, however I was locked out. It appears that it's only available to subscribers. I was particularly interested in the author's accounting methods and interpretation; for example, how did he handle the revenues from memorabilia licensing and trademark use? Those monies are generally seen as sports revenue, but are usually paid into the schools' general funds. Is this revenue considered a "subsidy" if passed on to the athletic department, or a "return" if kept by the general fund? What about those cases where the licensing fees are paid directly to the athletic department (I think that is the case with Texas)? The same is true with athletic donations that may or may not be routed through the university general fund. With so many different ways for account for the various revenue, expenses and donations, the author would have to have gone to extraordinary effort to normalize the accounting methods to ensure he was comparing "apples-to-apples." Did he do this with all 347 D1 schools?

This article http://www.nytimes.com/2015/11/07/sports/ncaafootball/alabama-crimson-tide-football-marketing.html in the NY Times from November presents a somewhat different view of the effect of Alabama football on the university's financial situation. It corresponds fairly well with a (lengthy) post I made a while back summarizing my conversations with two of the Alabama deans regarding the financial windfall the university had received over the last decade of football success. While a large part of Alabama's academic improvements should be attributed to the leadership and vision of former President (and now Chancellor) Robert Witt, I think that it's reasonable to assume that most successful programs, if properly managed, can expect to receive similar returns. I've a vested interest here: my baby girl is a frosh at Ole Miss; it will be interesting to see if they can keep their recent success on the field going, AND (more importantly) if they will be able to parlay that success into more money for the university as a whole.

 

[Scioto]

Zulu, all good points. I went back to the article link and it's now locked only to subscribers, which I am not. I originally linked to the article from another site but apparently the "free access" has expired. I don't recall the accounting methodologies used or how the study counted the beans so to speak. One data point that jumped out at me was LSU "giving" $19 million to the university without having any "subsidy" returned to it given the fiscal basket-case that is the state of Louisiana (I guess good news for fans of all LSU sports, but one has to wonder how much longer will Louisianans be able to keep their hands off the LSU athletic department?). We've both commented previously on how successful football programs have financially benefited universities. My question is just how sustainable are these major college athletic departments when it appears that only 10 of 347 give more than they take back. I think it was telling that 8 of those 10 are in conferences with cable networks. As states go through more fiscal stress in years to come with an aging population, I just don't believe that "the politicians" won't go after these golden eggs and the possible impact that could have on coaching salaries, the number of sports programs, facility improvements, etc. raises questions, at least in my mind, of sustainability. I forget how many FCS football schools there are but I think far more than FBS. It's well known that these "cupcakes" play the Alabamas and Ohio States for a pay-day that for many is the only way these schools can continue fielding a football team. UAB is a case in point (although did they re-establish the football team?)

 

[DaveB]

Think of all the jerseys and hats for the various teams, SEC or otherwise. When I am in Atlanta or Detroit or wherever airport you see tons of these.

I don't know if the going methodology is a flat fee, a fee per article, a fee per player, but there is money going from manufacturer to School, at least I would think so.

 

[Scioto]

Yes, the schools and conferences are making lots of money off licensing and merchandising, a few much, much more than others. Ohio State's Nike deal made it the only billion dollar "value" college football "franchise." Texas, Michigan close behind, and then Notre Dame, Alabama and a few others from the "Power 5" conferences round it out, but the space between the top 10 in all of these financial and brand value metrics is already quite great and growing. At some point, it's going to impact a schools ability to compete on the all-important facilities and salaries front. Football is probably the most expensive operation in the athletic department. I'm just saying that, maybe not right now, but soon for other than most in the B1G, SEC, and maybe a handful of other independent and ACC/Big 12/Pac 12 schools comprising the top 15-20 with strong revenue/brand value, the ability of the other programs to financially sustain competitive football teams could be in question. Even recently at UT, University of Maryland (before it joined the B1G), and UAB at the extreme, there are examples of how finances can negatively impact college athletic departments ability to field competitive teams or some teams.

I also wonder if the concentration of power so to speak in college football that we might be witnessing is healthy for the game long-term?