WSJ: College Football's Big-Money, Big-Risk Business Model

[Drumguy]

http://online.wsj.com/article/SB10001424127887324024004578169472607407806.html?mod=ITP_marketplace_0
"Longtime fans of the Big Ten Conference scratched their heads when Maryland and Rutgers were recently asked to join—largely for their TV markets and not because of the quality of their teams"

I think this quote tells you why LV and not us to the ACC: "Roger Noll, a Stanford economics professor emeritus, predicted that not all conference networks would survive. "It's obvious that intercollegiate sports are less popular in the rest of the country than they are in the Midwest and in the South," he says."

 

[whaler11]

Tough prediction since the MTN already passed. Can he get us the numbers from the last big Powerball drawing next?

 

[ZooCougar]

I think it's a bubble. If this situation ever settles in, eventually there will be some really pissed off schools that wonder what the hell they were thinking.

First they say it was about markets, then Alvarez leaks that it may have been about appeasing Penn State. I think that the second guessing over this will be going on for years.

 

[The Funster]

I think the TV contract bubble will burst, the conferences will have a lot of buyer's remorse and people will ask, "What the hell were we thinking?"

The conference commishes can say what they want and the bloggers can blog what they want but TV is not going to be THE major medium for very long. Judging the future by today's demographics is already outdated. Ten years is a lifetime and in that lifetime an awful lot is going to change.

 

[upstater]

There's a much bigger picture here though.

They are going to totally revamp college sports.

Once they get rid of the NCAA and grab that bball tourney, they will make new rules about what a student athlete is. These kids will be paid, the programs will become wings of the university much like the research foundations (nominally for-profit, but there are huge amounts of $$ there), and then they'll stage a full 16 game playoff at home venues that will also bring in a ton of dough. No objections to these kids missing out on classes at that point.

They need to get a reasonable amount of teams (70?) into these leagues that will split off and become some hybrid/semi-pro creature.

It's not only about TV and eyeballs. It's about real estate. If everyone has to go 16-18, you want to have the most valuable plots of land in your league, not in the others.

 

[The Funster]

But what about Title IX? What about antitrust? Do a handful of movers and shakers believe they can stand stand up to the Federal Gov't.? You would know better than me but if the major sports become a wing of the unis they can say they are excluded from that scrutiny? That could be a very hard sell, IMO, and could be in the courts for years.

 

[upstater]

But what about Title IX? What about antitrust? Do a handful of movers and shakers believe they can stand stand up to the Federal Gov't.? You would know better than me but if the major sports become a wing of the unis they can say they are excluded from that scrutiny? That could be a very hard sell, IMO, and could be in the courts for years.

How is this different from private research foundations attached to public entities? How is it different than the CIC? Heck, PAY these kids, then you don't have to worry about TitleIX. Go for-profit. Then you treat athletes the same way you treat people slinging hash in the cafeterias. given the national environment regarding privatization and for-profit schools, I bet the lawyers have already been through this with the schools.

 

[The Funster]

How is this different from private research foundations attached to public entities? How is it different than the CIC? Heck, PAY these kids, then you don't have to worry about TitleIX. Go for-profit. Then you treat athletes the same way you treat people slinging hash in the cafeterias. given the national environment regarding privatization and for-profit schools, I bet the lawyers have already been through this with the schools.

I don't know the answers to your questions. That is why I asked. So what you are saying is that big-time athletics will become a for profit entity of a not for profit institution. Eventually, unions will get involved. Eventually, these big time athletic programs will ask, "Why are we attached to the universities? Why are we funding all these other sports?" and may decide to split away completely. It looks like a seriously slippery slope unless I'm missing something.

 

[ZooCougar]

I don't know the answers to your questions. That is why I asked. So what you are saying is that big-time athletics will become a for profit entity of a not for profit institution. Eventually, unions will get involved. Eventually, these big time athletic programs will ask, "Why are we attached to the universities? Why are we funding all these other sports?" and may decide to split away completely. It looks like a seriously slippery slope unless I'm missing something.

That's the point at which people stop caring about college sports.
There is an intangible connection between these institutions and the state or region the come from. Once you sever that, you will see people start watching about something else.

 

[upstater]

That's the point at which people stop caring about college sports.
There is an intangible connection between these institutions and the state or region the come from. Once you sever that, you will see people start watching about something else.

To the average SEC fan, this stuff doesn't matter. The southern schools will be perfectly comfortable with a for-profit appendage. It will simply not matter to them. This is obvious to me already.

 

[ZooCougar]

To the average SEC fan, this stuff doesn't matter. The southern schools will be perfectly comfortable with a for-profit appendage. It will simply not matter to them. This is obvious to me already.

I don't think you understand the psyche of the average southern fan then. Because "that stuff" is hugely important down there. Without that connection, you have the USFL.

 

[upstater]

I don't think you understand the psyche of the average southern fan then. Because "that stuff" is hugely important down there. Without that connection, you have the USFL.

There will be a connection. It just doesn't matter that they are students. Look, Texas A&M's board fired a very effective President for her resistance when the AD blindsided her with a $15 million loss in one year. They want top football--they don't care about academics at all. They are the ones pushing for $5k a year to the players now.

 

[whaler11]

But the SEC and every other league need national interest - they can't generate the TV dollars if only the south cares.

 

[upstater]

But the SEC and every other league need national interest - they can't generate the TV dollars if only the south cares.

If they get all the talent, they will get the dollars. I also didn't say that only the SEC would do this. The SEC is driving the bus however.