Blog Archives

Mountain West Stable, For Now

The Mountain West appears to have won a large victory with the recent additions (or not losses if that’s how you choose to look at it) of Boise State and San Diego State.  That may in fact be the case.  However, there is also the possibility that in its quest for stabilization and increased stature, the Mountain West endangered itself by giving away crucial member equality in order to re-acquire Boise State.

Reports indicate the Mountain West has or will (among other things): 1) re-negotiate its television contract with CBS Sports Network which will allow teams on national television (i.e. Boise State) to make more money through bonuses, 2) sell Boise State’s home games in a separate package, and 3) allocate half of BCS (and future equivalent) bowl game revenue to the participating team (i.e. Boise State) before splitting it among the remaining conference members.

From the quotes of Big East commissioner Mike Aresco, it sounds as if Boise State wanted to stay in the Big East if it would match the Mountain West’s offer.  Smartly, Mr. Aresco and the remaining Big East schools’ (bonus points if you can name them) presidents said thanks, but no thanks.  In a time when it must feel like everything is crashing down around them, the Big East brass found a line they wouldn’t cross.  Good for them. Let’s face it, Boise State to the Big East wasn’t exactly the perfect mix of chocolate and peanut butter.  So for the Big East to grant unprecedented perks to a school 2,600 miles removed from the conference office didn’t make a whole lot of sense.  Navy Athletic Director Chet Gladchuck even went public with his disdain for the proposed deal, saying:

“What Boise State wanted was outrageous and unprecedented. It was not palatable to any of the other Big East institutions,” Gladchuk said. “In the final analysis, Boise wasn’t worth it. There is zero television interest in Boise along the Eastern seaboard. What it tells me is the Mountain West was desperate. Clearly, the Mountain West was willing to make whatever concessions necessary to keep Boise in the fold.”

But surely it made sense for the Mountain West to do whatever was necessary to bring Boise State back under its tent, right?  Maybe, maybe not.  The money grab that is conference realignment also has an undercurrent of trying to create and/or maintain stability and long-term viability.  As mentioned earlier, the Mountain West seems to have stabilized at 12 members.  But when gross member inequality is part of a league’s structure, there can be problems.

Example:  When the Big 12 was formed in the mid-90s, its structure was similar to how the Mountain West is currently proceeding.  Most notably, it did not share bowl and television revenue monies equally among the members.  Rather, the participating teams were first entitled to a larger share.  This obviously funneled most of the revenue toward the traditionally successful programs, and smaller amounts to everyone else. (Berry Tramel of The Oklahoman wrote about this structure in 2010.) As time passed the Big 12 and its membership experienced the difficulties of operating a conference successfully when there’s a sense that a few schools are driving the bus and collecting the checks, and the rest are just passengers along for the ride.  Ultimately, that and other issues led to the departure of 1/3rd of the Big 12’s schools (Nebraska, Colorado, Missouri, Texas A&M), and a near collapse of the conference entirely.

Whether the Big 12 leadership decided the original structure was a mistake, or that times had changed and therefore the structure needed to change with it, the powers that be agreed to a more (though not completely) equal distribution of revenue in the summer of 2011.  It also put a stake in the ground on stability by having each member grant its television rights to the conference for a long period of time (initially six years, but recently extended to 13), essentially removing the largest incentive to other conferences who may wish to come poaching in the future (the importance of this “grant of rights” was well articulated by Mat Winter in a BusinessofCollegeSports.com post last month).  I have not read or heard anything along the lines of Boise State or the other Mountain West schools making similar commitments.

So while the Big 12 (barely) escaped the inequality trap and the Big East has avoided it for now, the Mountain West may have fallen right in it.  Sure, Utah State and San Jose State are excited to be new members in a league which just got considerably stronger.  And the other Mountain West schools no doubt see the tremendous value Boise State brings to all of them.  But give those non-Boise State presidents and athletic directors a few years of conference meetings looking over financials, and watching the revenue flow into the conference and out to Boise State.  Give them a few years of conference meetings observing how decisions are made.

The camaraderie that exists today may not continue very long.  And without a grant-of-rights or similar level of commitment, Boise State is for all intents and purposes a perpetual free agent, available to accept the next best conference offer that comes along.  The Mountain West’s current and future members no doubt wanted to make decisions which ensured stability over the long-term.  And while the league certainly got immediately stronger with the addition of Boise State, it may be that the deal they made guarantees the long-term will be anything but stable.

Follow Daniel on Twitter: @DanielHare

BCS Payouts vs. March Madness Payouts

Quite frequently in the debate over the BCS there are comparisons to March Madness. Proponents of moving to a playoff system point to the approximately $771 million a year (beginning in 2011) March Madness generates in television alone (previously an average of $545 million). Meanwhile, the BCS bowls will generate just $125 million beginning in 2011 (previously$96.4 million per year ).

While it’s true March Madness generates more television revenue overall, that doesn’t necessarily mean more money for each athletic department. A total of $452,200,000 was distributed by the NCAA in 2010-2011, and less than half of all monies distributed went back into the athletic department with no strings attached (via the Basketball Fund). Here’s the breakdown:

Basketball Fund ($180,467,000): Monies are distributed based on a six-year rolling period. Institutions receive one unit for each appearance, not including the championship game. Each unit was worth $239,664 in 2010-2011.

Academic Enhancement ($22,461,000): Each Division I institution gets $66,000 to use for academic support service for student-athletes.

Conference Grants ($8,115,000): Each conference receives $261,744 less an agreed upon amount remitted to the regional officiating advisors program. Funds must be used to improve officiating, enhance conference compliance and enforcement programs, drug abuse education, enhancement of opportunities for ethnic minorities, and development of gambling education programs.

Sports Sponsorship Fund ($60,155,000): Each school’s share is determined based on the number of varsity sports sponsored. Points begin with the 14th sport (the number required in Division I), and $30,091 is distributed for each sport above thirteen. These monies may be directed to individual institutions or to the conference for distribution, as decided upon by each conference.

Grants-In-Aid Fund ($120,309,000): Each school’s share is determined based on the number of grants-in-aid awarded. These monies may be directed to individual institutions or to the conference for distribution, as decided upon by each conference.

Student Assistance Fund ($59,738,000): This fund also consists of the Special Assistance Fund and the Student-Athlete Opportunity Fund. For the Student Assistance Fund, all athletes are eligible to receive these funds, even if they have exhausted eligibility or no longer participate due to medical reasons. These monies are distributed to the conference who decides how to allocate. This fund is to be used to assist student-athletes with financial needs that “arise in conjunction with participation in intercollegiate athletics, enrollment in an academic curriculum or that recognize academic achievement. The Student-Athlete Opportunity Fund is distributed by conferences based on the formula used for sports sponsorship and grants-in-aid. The Special Assistance Fund is to be used to meet student-athlete financial needs of an emergency or essential nature for which other financial aid is not available.

Supplemental Support Fund ($955,000): Used to support campus-based initiatives designed to foster student-athlete academic success at eligible limited resource institutions.

At the end of the day, most conferences receive larger payouts from the BCS than March Madness when it comes to money going back into the athletic department with no strings attached. Below is a look at the payouts for the past four years. Totals in red reflect conferences who received a larger payout from basketball than football for the given year. You should also note the football payouts indicated for the non-AQ conferences (Mountain West, Mid-American, Sun Belt, C-USA and Western Athletic) are based on the payout from the BCS before the agreement between the conferences to split BCS money equally between all non-AQ conferences kicks in. Also, these numbers do not include payouts for non-BCS bowl games.

ACC 2006-2007 2007-2008 2008-2009 2009-2010
Football $18,088,675 $18,324,992 $18,672,725 $19,787,058
Basketball $14,149,120 $15,090,053 $15,863,538 $18,220,902
Difference  $3,939,555 $3,234,939 $2,809,187 $1,566,156
         
Big 10 2006-2007 2007-2008 2008-2009 2009-2010
Football $22,588,675 $22,824,992 $23,172,725 $24,287,058
Basketball $13,087,936 $13,561,946 $13,803,338 $15,332,222
Difference $9,500,739 $9,263,046 $9,369,387 $8,954,836
         
Big 12 2006-2007 2007-2008 2008-2009 2009-2010
Football $18,088,675 $22,824,992 $23,172,725 $19,787,058
Basketball $14,325,984 $15,663,093 $16,275,578 $17,109,871
Difference $3,762,691 $7,161,899 $6,897,147 $2,677,187
         
Big East 2006-2007 2007-2008 2008-2009 2009-2010
Football $18,088,675 $18,324,992 $18,672,725 $19,787,058
Basketball $14,856,576 $16,618,160 $19,365,880 $23,109,436
Difference $3,232,099 $1,706,832 ($693,155) ($3,322,378)
         
Pac 10 2006-2007 2007-2008 2008-2009 2009-2010
Football $18,088,675 $18,324,992 $18,672,743 $19,787,058
Basketball $11,849,888 $12,606,880 $13,391,298 $14,665,604
Difference $6,238,787 $5,718,112 $5,281,445 $5,121,454
         
SEC 2006-2007 2007-2008 2008-2009 2009-2010
Football $22,588,675 $22,824,992 $23,172,725 $24,287,058
Basketball $13,087,936 $14,708,026 $15,657,518 $15,110,015
Difference $9,500,739 $8,116,966 $7,515,207 $9,177,043
         
Mountain West 2006-2007 2007-2008 2008-2009 2009-2010
Football $3,529,600 $3,724,000 $9,788,800 $9,878,710
Basketball $3,183,552 $4,011,280 $4,120,399 $3,999,710
Difference $346,048 ($287,280) $5,668,401 $5,879,000
         
Mid-American 2006-2007 2007-2008 2008-2009 2009-2010
Football $1,964,800 $1,508,000 $2,094,400 $2,139,355
Basketball $1,945,504 $1,910,133 $1,442,140 $1,333,237
Difference $19,296 ($402,133) $652,260 $806,118
         
Sun Belt 2006-2007 2007-2008 2008-2009 2009-2010
Football $1,443,200 $2,062,000 $1,529,600 $1,559,570
Basketball $1,061,184 $1,146,080 $1,854,180 $2,222,061
Difference $382,016 $915,920 ($324,580) ($662,491)
         
C-USA 2006-2007 2007-2008 2008-2009 2009-2010
Football $2,486,400 $2,616,000 $2,659,200 $2,719,140
Basketball $7,782,016 $8,213,573 $9,064,879 $8,507,523
Difference ($5,295,616) ($5,597,573) ($6,405,679) ($5,788,383)
         
Western Athletic 2006-2007 2007-2008 2008-2009 2009-2010
Football $9,008,000 $9,170,000 $3,224,000 $7,798,925
Basketball $3,006,688 $3,247,227 $3,090,300 $3,110,886
Difference $6,001,312 $5,922,773 $133,700 $4,688,039

I think it’s interesting to note that AQ football conferences are bringing in more from March Madness than non-AQ football conferences. Some of that has to do with the smaller size of some of the non-AQ conferences, but it’s still rather sizeable disparity. Nonetheless, I imagine people still find the March Madness system more digestible because it is a playoff system and because payouts are based on number of appearances.

Special thanks to my research assistant Eric Heckman for helping me compile the data.

Big East Basketball Tournament Most Expensive

If you read this site regularly or follow me on Twitter, you know that I am in Ireland from May 17-25th. While I’m away, I’m sharing with you the work of Patrick Rishe, my collegue at SportsMoney on Forbes.com. This is the fifth of a series of pieces Patrick did for SportsMoney on college basketball finance. You can find all of my pieces on football finance here.

By: Patrick Rishe

If we can surmise anything from secondary ticket price data in sports, it’s the ebb and flow of real-time demand and value that consumers place on various sporting events.

That said, it seems that fans of the Big East Men’s Basketball tournament at Madison Square Garden in New York City place a greater premium and significance on that tourney than fans of all other BCS post-season basketball tourneys.

My source from StubHub furnished the following average secondary ticket price data for each round of each of the 6 BCS conferences in an effort to gauge the relative significance and importance that fans assign to each tournament respectively.

The results:

Round Big East Big 12 ACC Pac 10 Big Ten SEC
Early Rounds $70 $62 $48 $69 $54 $29
Quarters $279 $132 $127 $113 $110 $74
Semis $368 $268 $287 $153 $171 $123
Finals $217 $214 $201 $143 $106 $130
             
AGGREGATE PRICE $934 $676 $663 $478 $441 $356

Focusing on “aggregate prices” (i.e. the sum of the 4 rounds for each tourney), the Big East tourney is the most expensive BY FAR.  Its average “aggregate price” for all sessions on the secondary market is $934, over $250 more expensive than the “aggregate price” for either the Big 12 or ACC tourneys.

The Big East tournament is likely the most expensive because of location.  Being in New York drives the value of those tickets.

It’s also not surprising to see these 3 conferences lead the way in “secondary market ticket prices” because they are the most popular conference tournaments, according to 2010 NCAA attendance data. Specifically, in 2010 these 3 conferences had the highest attendance per session (ACC – 23,371; Big East – 19,375; Big 12 – 18,900).

So in the context of valuing a sports entity, the Big East tournament is the most prized, valued, and popular of the BCS men’s basketball tournaments.  And the fact that the games are played amidst the glitz and glamour of New York City in the historic Madison Square Garden are reasons that drive these facts.

*******************************************************************************************************

Follow Patrick @ SportsDocRock or visit www.patrickrishe.net

Duke, Louisville and UNC are College Basketball’s Financial Heavyweights

Image via Getty Images by @daylife

If you read this site regularly or follow me on Twitter, you know that I am in Ireland from May 17-25th. While I’m away, I’m sharing with you the work of Patrick Rishe, my collegue at SportsMoney on Forbes.com. This is the fourth of a series of pieces Patrick did for SportsMoney on college basketball finance. You can find all of my pieces on football finance here.

By: Patrick Rishe

Duke University is the top revenue generating men’s basketball program in the country, generating over 160% more revenue than the national average among other BCS basketball programs.

In Part I of my review of college basketball financials entitled “Revenue Comparisons Among Division I Men’s Basketball Conferences” using financial data for the 2009-2010 academic year, we saw that:

- The Big East Conference was the only conference that generated over $150 M in men’s basketball revenue;

- The Big Ten and ACC were the only other conferences that generated over $133 M in men’s basketball revenue;

- Only 3 conferences (Big Ten, ACC, SEC) generated over $10 M in men’s basketball revenue per school.

In Part II of my analysis of college basketball financials herein, I analyze which BCS-conference schools generate the most revenues from men’s college basketball.

In Pictures: The Top Earning College Basketball Coaches

Similar to my first report, the data reported herein was obtained from the U.S. Department of Education. Federal statute requires schools to report the financials for their athletic departments, and it also helps define itemized expense and revenue categories which builds uniformity in data reporting.  This makes for a robust data source.  The most recent data available is for the 2009 academic year.

DUKE, LOUISVILLE, NORTH CAROLINA TOP THE REVENUE LIST

There are 6 BCS Conferences (Big East, Big Ten, Big 12, ACC, Pac 10, SEC) with a combined 73 teams.

The average BCS Men’s Basketball program generated $10.1 M in revenue.  The median revenue was significantly lower at $8.8 M, which suggests (as we’ll soon see) that some teams near the top of the distribution were significant outliers and were well above the national average.

The table below ranks all 73 BCS teams in terms of their men’s basketball revenue reported in 2009, and calculates a ‘ratio’ between that team’s revenue relative to the national mean.

Rank Team MBB Rev Index
1 Duke $26,667,056 2.64
2 Louisville $25,890,003 2.57
3 North Carolina $20,551,168 2.04
4 Arizona $19,285,038 1.91
5 Syracuse $18,309,470 1.82
6 Wisconsin $17,666,311 1.75
7 Kentucky $16,781,239 1.66
8 Indiana $16,570,158 1.64
9 Ohio St. $16,190,723 1.61
10 Michigan St. $16,138,167 1.60
11 Kansas $16,116,502 1.60
12 Texas $15,602,348 1.55
13 Arkansas $15,515,830 1.54
14 Illinois $14,413,222 1.43
15 Marquette $13,877,475 1.38
16 Minnesota $13,733,316 1.36
17 West Virginia $13,306,654 1.32
18 Tennessee $13,301,579 1.32
19 Pittsburgh $13,117,849 1.30
20 UCLA $12,353,487 1.23
21 Oklahoma State $12,085,306 1.20
22 Washington $11,481,376 1.14
23 Alabama $10,766,327 1.07
24 Maryland $10,739,282 1.06
25 NC State $10,354,157 1.03
26 Florida $10,184,136 1.01
27 Georgetown $10,074,618 1.00
28 Northwestern $10,048,801 1.00
29 Virginia $9,788,223 0.97
30 Auburn $9,588,191 0.95
31 Missouri $9,540,265 0.95
32 Virginia Tech $9,252,293 0.92
33 South Carolina $9,190,794 0.91
34 Vanderbilt $9,182,578 0.91
35 Georgia Tech $9,143,914 0.91
36 Wake Forest $9,064,780 0.90
37 Texas A & M $8,853,325 0.88
38 Iowa $8,796,540 0.87
39 Oklahoma $8,626,247 0.86
40 Arizona St. $8,591,421 0.85
41 Penn St. $8,384,315 0.83
42 Georgia $8,331,515 0.83
43 Michigan $8,321,413 0.83
44 Mississippi State $8,205,804 0.81
45 Boston College $8,026,369 0.80
46 Purdue $7,791,967 0.77
47 Connecticut $7,745,145 0.77
48 Villanova $7,652,470 0.76
49 Kansas State $7,259,800 0.72
50 Iowa State $7,182,665 0.71
51 University of Miami $7,081,121 0.70
52 Clemson $7,054,691 0.70
53 California $6,967,208 0.69
54 Ole Miss $6,821,532 0.68
55 LSU $6,767,009 0.67
56 St. John’s $6,741,298 0.67
57 DePaul $6,528,661 0.65
58 Providence $6,460,838 0.64
59 Seton Hall $6,215,923 0.62
60 Stanford $6,191,021 0.61
61 Nebraska $6,022,208 0.60
62 Florida State $5,756,857 0.57
63 Baylor $5,737,350 0.57
64 Texas Tech $5,092,921 0.51
65 Oregon St. $4,938,930 0.49
66 Cincinnati $4,927,771 0.49
67 Rutgers $4,634,026 0.46
68 South Florida $4,588,627 0.46
69 Notre Dame $4,051,468 0.40
70 Colorado $3,587,371 0.36
71 Washington St. $3,544,745 0.35
72 USC $3,535,629 0.35
73 Oregon $3,240,150 0.32
       
  MEAN $10,083,959  
  MEDIAN $8,853,325  

Significant points to note:

- The Top 3 schools financially in men’s basketball (Duke, Louisville, North Carolina) are the only schools that (A) generated over $20 M and (B) earned at least 100% more men’s basketball revenue relative to the national average.

Duke and Louisville truly stand out, generating 164% and 157% more than the national average, respectively.

- 13 schools generated at least 50% more revenue from men’s basketball than the national average.

The Big Ten leads the way with 4 of those teams (Wisconsin, Indiana, Ohio St, Michigan), then 2 each from the ACC, Big East, SEC, and Big 12, and only 1 Pac 10 school (Arizona).

- Conversely, there are 9 schools that generated at least 50% less revenue from men’s basketball than the national average.  Not only are 4 of those 9 schools from the Pac 10 (Oregon, USC, Washington St, Oregon St), but another of these 9 schools (Colorado) will be joining the Pac 12 next season.

Indeed, we see why Larry Scott, new Commissioner of the Pac 12 Conference, was hired to infuse new life, vitality, and aggressive revenue-seeking behavior into this entity.

BIG TEN HAS SEEN THE MOST GROWTH

Likely linked to the creation of The Big Ten Network which launched in August 2007, the Big Ten has shown the most growth in men’s basketball revenues since 2003.

The table below compares men’s basketball revenue for the entire conference in 2009 to 2003.  It corrects for inflation by using CPI data from 2009 and 2003 to calculate the 2003 revenues in “2009 dollars”.  Lastly, a “growth ratio” is calculated to see the growth in “real revenues” from 2003 to 2009.

Conference 2009 2003 2003 (in 2009 $) Growth Ratio
Big Ten $138,054,933 $37,708,837 $43,976,630 3.14
ACC
$133,479,911
$84,761,805
$98,323,694 1.57
Big East $154,122,296 $88,058,061 $102,147,351 1.51
SEC $124,636,534 $73,261,482 $84,983,319 1.47
Big 12 $105,706,308 $67,572,143 $78,383,686 1.35
Pac 10 $80,129,005 $54,537,074 $63,263,006 1.27

4 of the 6 BCS conferences have seen real growth rates in men’s basketball revenue between 35-57%.

However, the Big Ten has seen the greatest growth by far.  Their conference revenues from men’s basketball are 214% greater than in 2003 after adjusting for inflation.

Data like this makes it clear why conferences want their own sports networks.

If any of the conferences could use a cable network to promote its own sports league, its the Pac 10.  At 27% growth, their men’s basketball revenues have grown the least over that 6 year span.

Please be sure to check back in later this week as our look into the Economics of College Basketball continues, including a more detailed look at individual conferences.

Many thanks to Saint Louis University Sports Business students Bryan Beasley, Jacob Fish, Brett Goldman, Jeff Tiedman, Jordan Erk, and Andrew Moses for their contributions to this article.

************************************************************************

Follow Patrick on Twitter @ SportsDocRock or visit www.patrickrishe.net

School-Specific Broadcasting Revenue

Yesterday I showed you how each conference’s television contracts compare in terms of first and second tier rights fees. I didn’t cover third tier rights because they’re so hard to track down. Some third tier rights are bundled by the conference as a whole and sold to regional networks while others are retained by each individual school and sold to a local or regional network.

What I can show you is what each school is showing as revenue for broadcasting rights (television, radio and internet) through their responses to open records requests. This is separate from the money they receive from conference distributions, so it shouldn’t include any broadcasting money received from conference-wide media rights contracts.

The chart below is every school for which I have a value and represents the 2009-2010 school year. Those not listed either showed $0 or did not have to respond to open records requests (either because they’re private or protected by state laws).

1 University of North Carolina $11,171,458.00
2 University of Alabama $8,444,674.00
3 University of Kentucky $7,743,327.00
4 University of Florida $7,450,000.00
5 University of Kansas $7,276,988.00
6 Louisiana State University $7,012,730.00
7 Oklahoma State University $6,395,000.00
8 University of Tennessee $6,293,621.00
9 Oregon State University $6,267,671.00
10 University of Georgia $6,231,392.00
11 University of Wisconsin $5,547,740.00
12
Auburn University
$4,637,605.00
13 University of Nebraska $4,393,529.00
14 University of Missouri $4,081,549.00
15 Virginia Tech $3,769,583.00
16 Kansas State University $3,263,941.00
17 Iowa State University $2,608,896.00
18 North Carolina State University $2,470,750.00
19 Penn State University $2,362,500.00
20 Ohio State University $2,329,462.00
21 University of South Carolina $1,829,000.00
22 University of Connecticut $1,749,796.00
23 University of Louisville $1,675,000.00
24 University of Mississippi $1,658,650.00
25 University of Iowa $1,500,000.00
26 Georgia Tech $1,254,876.00
27 University of Washington $1,248,599.00
28
University of Illinois
$1,175,065.00
29 University of Cincinnati $1,000,000.00
30 University of Arkansas $950,000.00
31 Clemson University $920,000.00
32 Michigan State University $660,025.00
33 University of South Florida $588,298.00
34 Washington State University $562,098.00
35 West Virginia University $404,284.00
36 Florida State University $349,869.00
37 University of Texas $338,171.00
38 University of Minnesota $324,000.00
39 University of Oklahoma $317,361.00
40 University of Colorado $155,528.00
41 University of Oregon $108,452.00

Because I know fans enjoy arguing about which conference is better, here are the averages for each conference (keep in mind, however, each conference has one or more schools whose numbers aren’t available):

SEC: $4,750,091

ACC: $2,848,077

Big 12: $2,620,997

Big Ten: $1,389,879

Pac-10: $1,169,546

Big East: $902,896

Don’t give these averages too much weight in terms of comparing conferences. Tough to really compare the conferences, because the third-tier rights left for each school to sell individually varies greatly by conference based on what third-tier rights have been packaged by the conference as a whole.

If you’re interested in seeing a conference-by-conference breakdown, follow the jump…

Read the rest of this entry

Televison Contract Breakdown

UPDATED INFO AVAILABLE: Kristi has posted an updated breakdown of the television contracts on ESPN.com (5/10/12).

My search for details on all of the current television deals for each conference in one place failed. Which must mean BusinessofCollegeSports.com needs to compile all the details in one easy-to-find place, right?

To understand the chart, you first need to understand the types of rights available. Here is a very general explanation. First-tier rights are for football and/or basketball games broadcast nationally. Second-tier rights are for football and/or basketball games not selected by the first-tier rights holder. Third-tier rights are any games not selected by the first or second-tier rights holders and rights for all sports other than football and basketball. These rights are often sold on a per-school basis (not negotiated by the conference as a whole) and often go to regional networks (like Comcast Sports Southeast, Raycom, or SportsNet New York) or can be reserved for networks like the Big Ten Network and the Texas Longhorn Network.

All that being said, deals are now being done for multiple tiers. For example, the Pac-12′s new deal with ESPN and Fox covers first and second tier rights. Meanwhile, the ACC’s new deal that begins this fall covers football,  men’s and women’s basketball, Olympic sports and all conference championship games. Basically, it’s an all-inclusive package with a sublicensing arrangement in place with Raycom for games not broadcast by ESPN.

First-Tier Rights Term of First-Tier Rights Second-Tier Rights Term of Second-Tier Rights Total Per Year Average
Big 12  $480,000,000 (ESPN) 8 Years $1,170,000,000 (Fox) 13 Years $150,000,000
08/09-15/16 12/13-24/25
Pac-12 $3,000,000,000 (ESPN and Fox) for first and second-tier; 12 years (12/13-23/24) $250,000,000
ACC $1,860,000,000 (ESPN) for all-inclusive; 12 years (11/12-22/23) $155,000,000
SEC $825,000,000 (CBS) 15 Years $2,250,000,000 (ESPN) 15 Years $205,000,000
09/10-23/24 9/10-23/24
Big Ten $1,000,000,000 (ESPN) 10 Years $2,800,000,000 (BTN) 25 Years $212,000,000
06/07-15/16 07/08-31/32
Big East $200,000,000 (ESPN) 6 Years $54,000,000 (CBS) 6 Years $42,333,333
06/07-11/12 7/8-12/13

Some caveats are in order now that you’ve seen the chart. Keep in mind that the per year number is an average. It is not necessarily what each school gets each year. A number of these contracts have escalator clauses, including the new Pac-10/12 contract. In the early years of that contract, it will be $180 million per year (or $15 million per school) and in the later years it escalates, according to Larry Scott via conference call on Wednesday following the contract’s announcement.

Though it doesn’t fit in the chart, you can’t forget the money Texas is receiving for The Longhorn Network. They’ve been guaranteed $300 million over the next 20 years from ESPN. Similarly, the amount listed above for Big Ten Network revenue is a projected amount which could grow if the network exceeds expectations.

Deals for third-tier rights are too cumbersome to cover here. Some third-tier rights are bundled by conferences and sold to regional networks while others are retained by schools and sold individually to local or regional networks. More on that in a future post.

The next contract we expect to hear about is out of the Big East. Rumors of a new deal have been circulating lately and reports have it that they were close to a deal with ESPN but considering shopping on the open market. Numbers floating around for a deal with ESPN were in the $110-130 million range per year, which would more than triple their current contract. With the SEC, ACC and Pac-12 now all on the ESPN family of stations, can the Big East get a deal with enough exposure from them?

And what will happen with the Big 12′s first-tier rights? I’ve heard a lot of comparisons between their recent deal with Fox and the Pac-10/12′s  new deal announced yesterday with ESPN. I think it’s comparing apples to oranges. It should be no big shock that the Pac-10/12 would receive more money for their first tier rights than the Big 12 received for their second tier rights. Let’s wait and see what kind of dough the Big 12 commands when their first tier rights are up for grabs in the next few years.

UPDATE: I’ve posted school-specific broadcasting revenue from third tier rights sold individually here.

Special thanks to Mark Ennis of Big East Coast Bias for helping me track down the elusive value of CBS’s contract with the Big East!

Appearance on WTSP re: USF Student Fees

Thanks to Noah Pransky (@NoahPransky) of WTSP for interviewing me for his piece on USF student fees yesterday! Here’s the video:

http://www.wtsp.com/video/default.aspx?bctid=931443933001

And here’s Noah’s well-written piece on the story:

TAMPA, Florida – For most, it’s been four years of hard work, studying, and sacrifices.  But one thing many of the 5,700 graduating seniors at the University of South Florida never learned was how much of their money was going toward the growing athletic department.

By the time the average senior walks across the stage to get his or her diploma this week, he or she will have paid more than $1,600 to the USF Athletics Department through student fees.

Each student currently pays $13.73 per credit hour to the athletics department, more than the $11.28 that goes toward student activities and the $9.30 that goes toward student health.  Undergraduates need at least 120 credit hours to graduate.

All told, student fees make up $14.5 million of the university’s $34.9 million athletics budget, or 42% in budget year 2010-2011.

In the 2009-2010 budget, student fees made up only 33%, but it was still the largest total of any school in the six major conferences:

  1. USF (33%)
  2. Virginia (15%)
  3. UConn (15%)
  4. Rutgers (13%)
  5. Miss St. (10%)

“This is not unusual,” said Kristi Dosh of The Business of College Sports.  “(Most) sports lose money and football and men’s basketball have to make up for it along with alumni contributions and student fees.”

But at USF, she said, the football and men’s basketball programs are only turning profits of $4 million and $1 million, respectively, so student fees have to balance the budget.

Dosh added that many Florida public schools in smaller conferences relied even more heavily on student fees in the last full budget year, 2009-2010 (student fees as percentage of total athletics budget in parenthesis):

  1. FIU (71%)
  2. FAU (55%)
  3. UCF (44%)
  4. USF (33%)
  5. FSU (9%)
  6. UF (2%)

At the University of Florida, the football program turns a $44 million profit annually – more than the entire USF budget for all sports.  Alumni donations were also plentiful at UF.

USF alumni contributions were minimal, Dosh said.

“I’ve talked to a number of different athletic departments in similar positions (as USF),” Dosh said.  “The hope is that in the future, as their program grows and their football team gets stronger, alumni will step up and shoulder more of the burden.”

Dosh said USF revenue has soared since joining the Big East and should continue to grow, potentially easing the reliance on student fees.

And officials at USF pointed out students that pay the fees have access to free tickets to all events, including the largest football allocation in the Big East. 

Dosh and university officials both said a successful athletics program helps boost a university’s reputation as well as its academics.

“If the university has certain accolades and is well-known across the country,” Dosh said, “it can apply for research grants and other things…it can lift the whole school up.”

Connect with 10 News reporter Noah Pransky on Twitter at www.twitter.com/noahpransky, Facebook at www.facebook.com/noahpransky, or on his Sports Business blog, Shadow of the Stadium.

I’ll only add a few things to his story. Although UCF funds their athletics budget with a larger percentage of student fees, they charge less per credit hour at $12.98 per hour. However, they have a larger student body and therefore take in more in terms of dollar amount and use it to fund a larger portion of the athletics budget. Students I’ve talked to at UCF have said they don’t mind. They point to the outstanding athletics facilities on campus and their hope that spending like a Big East program will one day make them a Big East program.

The other thing I wanted to touch on is something I wrote about yesterday in my Five-Year Snapshot of USF Athletics Finance.  USF has seen very little growth in alumni donations over the past five years at just over 8 percent.  I checked a couple of other programs in the conference and their increases in alumni contributions over the same time period was far more substantial: Louisville had a 45.82% increase and Rutgers had a whopping 116.34% increase. I also checked some other schools I had laying in front of me, both of which also had far more substantial increases than USF: UCF had a 58.11% increase and Memphis had a 64.38% increase.

The bottom line is that students are always going to be left to shoulder the burden when football profits and alumni contributions are not. The situation at USF is not unique, but it does more closely resemble the plight of non-AQ programs than the status quo of other AQ programs.

It’s my opinion that students will see a return on this investment if the program grows. When athletics programs are able to reach a national audience they attract more applicants to the school. Over time, this allows the school to be more selective. As the quality of the student population improves, the university garners more accolades and is able to improve academically by attracting better professors, qualifying for research grants and so on.

You can read more about finances around Conference USA here and see the entire list of top 25 student fee recipients here. Interested in what your school’s athletic department is taking in from students? You can find the SEC, Big Ten and Big 12 here, the Pac-10, ACC and Big East here, and the non-AQ conferences here.

Top 25 Recipients of Student Activity Fees in BCS

Student Section at UCF Football Game

Last week I showed you the top recipients of student fees in the AQ conferences. That list changes dramatically when you consider non-AQ schools. Here are the top 25 recipients of student activity fees in the BCS based on dollar amount:

1 University of Central Florida $17,466,918.00 44%
2 Ohio Univ $16,460,250.00 69%
3 Univ of Akron $16,199,911.00 67%
4 Florida Intl Univ $15,635,778.00 71%
5 Miami Univ (OH) $13,786,549.00 53%
6 University of South Florida $13,026,289.00 33%
7 University of Virginia $12,160,103.00 15%
8 Kent State $10,516,660.00 54%
9 East Carolina University $10,441,783.00 32%
10 San Diego State Univ $10,220,740.00 31%
11 Univ of Toledo $9,824,257.00 49%
12 Bowling Green $9,497,261.00 50%
13 Ball State Univ $9,221,400.00 46%
14 Florida Atlantic Univ $8,877,456.00 55%
15 University of Connecticut $8,626,506.00 15%
16 Rutgers University $8,441,092.00 13%
17 Northern Illinois Univ $8,333,419.00 38%
18 University of Memphis $7,666,067.00 19%
19 Univ of Buffalo $7,439,422.00 29%
20 Florida State University $6,919,449.00 9%
21 University of North Carolina $6,859,868.00 9%
22 Middle Tennessee State $6,848,065.00 33%
23 Virginia Tech $6,533,756.00 10%
24 Western Kentucky $6,437,652.00 28%
25 Univ of Southern Miss $6,056,608.00 31%

Only six on the list come from AQ conferences and all are either from the ACC or Big East. It’s also interesting to note that five Florida schools and four Ohio schools are in the top 25, which I’ll discuss more below.

Perhaps more interesting than the dollar amount, which is certainly influenced by size of enrollment and amount of student activity fees charged per student, is which schools top the list in terms of the percent of total athletic department revenue being generated by student fees:

  School Student Fees % of Total Revenue
1 Florida Intl Univ $15,635,778.00 71%
2 Ohio Univ $16,460,250.00 69%
3 Univ of Akron $16,199,911.00 67%
4 Florida Atlantic Univ $8,877,456.00 55%
5 Kent State $10,516,660.00 54%
6 Miami Univ (OH) $13,786,549.00 53%
7 Bowling Green $9,497,261.00 50%
8 Univ of Toledo $9,824,257.00 49%
9 Univ North Texas $5,007,059.00 49%
10 Ball State Univ $9,221,400.00 46%
11 University of Central Florida $17,466,918.00 44%
12 Northern Illinois Univ $8,333,419.00 38%
13 Univ Arkansas Little Rock $3,627,665.00 38%
14 Univ South Alabama $5,680,478.00 35%
15 University of South Florida $13,026,289.00 33%
16 Middle Tennessee State $6,848,065.00 33%
17 East Carolina University $10,441,783.00 32%
18 San Diego State Univ $10,220,740.00 31%
19 Univ of Southern Miss $6,056,608.00 31%
20 Arkansas State Univ $2,832,773.00 30%
21 Univ of Buffalo $7,439,422.00 29%
22 Western Kentucky $6,437,652.00 28%
23 San Jose State $4,683,122.00 23%
24 University of Memphis $7,666,067.00 19%
25 Utah State $3,700,874.00 19%

Seven schools get at least half their budget from student fees, with students at Florida International providing more than 70% of the total revenue for the athletic department! If you expand the pool to schools receiving at least a third of their athletic department revenue from student fees, you’re up to sixteen schools. This time only one AQ school makes it onto the list: South Florida. While there’s certainly a trend in the non-AQ conferences for requiring student fees to fund athletics, there’s a definite pattern in Florida and Ohio.

I spoke with Brad Stricklin of University of Central Florida Read the rest of this entry

Ten AQ Programs Who Rely the Most on Student Activity Fees

Here’s a little bonus for the weekend if you liked the stories on which programs rely the most heavily on student activity fees (SEC, Big Ten and Big 12 breakdown here – ACC, Pac-10 and Big East breakdown here).

The top ten schools by dollar amount:

1 University of South Florida $13,026,289.00 33.24%
2 University of Virginia $12,160,103.00 14.86%
3 University of Connecticut $8,626,506.00 14.74%
4 Rutgers University $8,441,092.00 13.15%
5 Florida State University $6,919,449.00 9.30%
6 University of North Carolina $6,859,868.00 9.42%
7 Virginia Tech $6,533,756.00 10.27%
8 Auburn University $5,261,604.00 5.68%
9 Georgia Tech $4,643,368.00 8.39%
10 North Carolina State University $4,200,610.00 8.49%

The top ten schools by percent of total revenue:

1 University of South Florida $13,026,289.00 33.24%
2 University of Virginia $12,160,103.00 14.86%
3 University of Connecticut $8,626,506.00 14.74%
4 Rutgers University $8,441,092.00 13.15%
5 Mississippi State University $4,000,000.00 10.49%
6 Virginia Tech $6,533,756.00 10.27%
7 University of North Carolina $6,859,868.00 9.42%
8 Florida State University $6,919,449.00 9.30%
9 North Carolina State University $4,200,610.00 8.49%
10 Georgia Tech $4,643,368.00 8.39%

In both cases 9 of the 10 are ACC and Big East schools. SEC programs Auburn and Mississippi State fill out the final slot in each.

As I showed you yesterday, the ACC and Big East average the least fooball revenue out of the AQ conferences. Now you see they lead in reliance on student activity fees. Coincidence? I think not.

Which Programs Rely on Student Activity Fees – Pt 2

This morning we took a look which athletic departments in the SEC, Big Ten and Big 12 rely on student activity fees. The big recipients, however, are in the ACC and Big East. Before we get to them, however, let’s take a look at the Pac-10:

Pac 10 Dollar Amount Percent of Revenue
University of California – Los Angeles $2,750,481.00 4.45%
University of California – Berkeley $2,146,402.00 3.10%
Oregon State University $2,142,702.00 3.85%
Washington State University $1,862,522.00 4.73%
University of Oregon $1,544,344.00 1.26%
University of Washington $0.00 0.00%
University of Arizona $0.00 0.00%
Arizona State University $0.00 0.00%
Stanford University N/A N/A
University of Southern California N/A N/A

In terms of average amount of student fees received, the Pac-10 comes in at $1.3 million, which puts it ahead of the Big Ten and Big 12. As we saw in the SEC, Big Ten and Big 12, top football revenue generators in the Pac-10 didn’t rely on student activity fees, namely Washington and Arizona State. In addition, Washington turned a $2.4 million profit (according to Department of Education data) without reliance on these types of fees.

Two of our top five student activity fee recipients come from the ACC, where all schools who reported receive these fees to supplement the athletic department’s budget:

ACC Dollar Amount Percent of Revenue
University of Virginia $12,160,103.00 14.86%
Florida State University $6,919,449.00 9.30%
University of North Carolina $6,859,868.00 9.42%
Virginia Tech $6,533,756.00 10.27%
Georgia Tech $4,643,368.00 8.39%
North Carolina State University $4,200,610.00 8.49%
Clemson University $1,585,556.00 2.75%
Duke University N/A N/A
University of Maryland N/A N/A
Wake Forest University N/A N/A
University of Miami N/A N/A
Boston College N/A N/A

University of Virginia ranks second both in amount and percentage of total revenues. If you’ve read the piece on the finances of ACC football programs and overall athletic department finance, you’ll remember UVA led the conference in overall athletic department revenue even though they were below the midpoint for football revenue. That prompted me to call their athletic department and ask a few questions, wherein they revealed the high dollar amount they receive in student activity fees. Upon finding out that conference opponent Georgia Tech only received roughly a third of that amount, I decided to begin work on this piece.

There does seem to be some correlation between the average student activity fee received by schools within a conference and where that conference falls in terms of average football revenue. Before we look at that, however, here’s how the Big East stacks up: Read the rest of this entry