Surprised this wasn't posted already. Let's see how this plays out. Interesting, considering the recent P5 ruling.
http://espn.go.com/college-sports/story/_/id/11328442/judge-rules-ncaa-ed-obannon-antitrust-case
The NCAA cannot stop schools or conferences from paying football and Division I men's basketball players money that is generated through the use of their names and images, U.S. District Court Judge Claudia Wilken ruled.
No surprises here. There wasn't much chance for any other outcome.
So, let's see. Is the MCAA ruling about the 5 power conferences going to destroy college sports or is it this ruling?
Or, maybe it is the Messersmith/McNally ruling from 1976 that is going to destroy MLB.
Quote from: muhoosier260 on August 08, 2014, 08:34:12 PM
Let's see how this plays out.
http://espn.go.com/college-sports/story/_/id/11328442/judge-rules-ncaa-ed-obannon-antitrust-case
This is the mantra of Scoop, no?
Quote from: Heisenberg on August 08, 2014, 09:24:13 PM
The NCAA cannot stop schools or conferences from paying football and Division I men's basketball players money that is generated through the use of their names and images, U.S. District Court Judge Claudia Wilken ruled.
But they are allowed to put caps on such payments.
Really, this is yet another thing that in the end is just different...not good...not bad.
Per the actual ruling, they could actually just reduce the value of a scholarship by $5000 and then impose a $5000 maximum cap on the payments.
The athletes would then have no additional benefit from the ruling.
Quote from: We R Final Four on August 08, 2014, 09:40:30 PM
This is the mantra of Scoop, no?
Touche, but if the OP took a real stance, hellfire would be cast upon him (Scoop bylaw 2(a)(ii)).
Quote from: forgetful on August 08, 2014, 10:12:54 PM
Per the actual ruling, they could actually just reduce the value of a scholarship by $5000 and then impose a $5000 maximum cap on the payments.
The athletes would then have no additional benefit from the ruling.
Where did this $5k cap come from? Did this judge just pull it out of thin air?
Quote from: El Guerrero on August 08, 2014, 11:34:08 PM
Where did this $5k cap come from? Did this judge just pull it out of thin air?
Basically yes. And that on its own is likely sufficient to get this overturned.
The basic argument is that the NCAA was guilty of collusion by not allowing schools to provide compensation. But as part of the ruling the judge says that the NCAA can cap the maximum amount (which is itself tantamount to collusion), so the ruling itself is internally inconsistent.
This ruling sucks for Marquette and the rest of the Big East. The power 5 conference will be able to dish out a whole lot more money to its players than any other conference.
DOWN GOES THE BIG EAST
Quote from: ThatDude on August 09, 2014, 11:30:22 AM
This ruling sucks for Marquette and the rest of the Big East. The power 5 conference will be able to dish out a whole lot more money to its players than any other conference.
DOWN GOES THE BIG EAST
The typical scoop answer .... Some one hears something somewhere changes ... Announced MU is screwed first and then go about figuring out what happened.
Aren't we forgetting something ... When players are getting paid everything they get is taxable. So, congrats blue chip recruit. Here your $50,000 for signing bonus with Kentucky and here is your tax bill for all compensation (tuition, room board, extras and $50k cash) which will take $40k of that total.
Chicos is correct, this benefits about a dozen basketball players a year (all of next years lottery picks), is a push for 18 other players (the rest of next years first round picks) and screws 1100 other players (they have to pay tax on their schollies).
The loser is not MU ... The loser is all players not ranked in the top 25 from families that cannot afford the tax bill.
Quote from: Heisenberg on August 09, 2014, 12:01:57 PM
Aren't we forgetting something ... When players are getting paid everything they get is taxable. So, congrats blue chip recruit. Here your $50,000 for signing bonus with Kentucky and here is your tax bill for all compensation (tuition, room board, extras and $50k cash) which will take $40k of that total.
Chicos is correct, this benefits about a dozen basketball players a year (all of next years lottery picks), is a push for 18 other players (the rest of next years first round picks) and screws 1100 other players (they have to pay tax on their schollies).
The loser is not MU ... The loser is all players not ranked in the top 25 from families that cannot afford the tax bill.
If true, then Marquette will NEVER get a blue chip recruit.
Quote from: ThatDude on August 09, 2014, 12:09:38 PM
If true, then Marquette will NEVER get a blue chip recruit.
Why? What makes MU different than any other school?
Quote from: ThatDude on August 09, 2014, 11:30:22 AM
This ruling sucks for Marquette and the rest of the Big East. The power 5 conference will be able to dish out a whole lot more money to its players than any other conference.
DOWN GOES THE BIG EAST
I read it differently. Given that on average, Big East schools have larger basketball budgets than the power 5 conferences, I think we will do just fine. If we had football, we would be screwed.
I'm at a volleyball camp right now with my son...run by former gold medalist Pat Powers....they're talking up scholarships and all that stuff. Talking about all the growing opportunities for sand volleyball and indoor in college, but yesterday's ruling has them worried as some schools that were looking to add may not any longer. Others may drop. For some of these people investing 1000's of dollars a year in training, camps, club, etc, the reality was sinking in a bit with the talk this morning.
Be careful what you wish for, you just might get it.
Quote from: ChicosBailBonds on August 09, 2014, 12:19:58 PM
I'm at a volleyball camp right now with my son...run by former gold medalist Pat Powers....they're talking up scholarships and all that stuff. Talking about all the growing opportunities for sand volleyball and indoor in college, but yesterday's ruling has them worried as some schools that were looking to add may not any longer. Others may drop. For some of these people investing 1000's of dollars a year in training, camps, club, etc, the reality was sinking in a bit with the talk this morning.
Be careful what you wish for, you just might get it.
Put those thousands in a savings account. You'll have more money that way. A volleyball club is about as sure an "investment" as a Haitian penny stock.
Quote from: TAMU Eagle on August 09, 2014, 12:19:17 PM
I read it differently. Given that on average, Big East schools have larger basketball budgets than the power 5 conferences, I think we will do just fine. If we had football, we would be screwed.
Who is also screwed is the big time highly paid head coach. Part of the reason the get huge dollars is their ability to recruit. Now you can buy the recruit, the coach will not get that premium to be a recruiter.
Advantage MU
Quote from: Heisenberg on August 09, 2014, 12:17:06 PM
Why? What makes MU different than any other school?
What makes MU different? Marquette is not in the power 5. Those power 5 schools has the ability to come together and agree on a cap for the players. What if each of those schools put 1 million dollars in the pot?
Look at it like running a franchise. The Yankees are the 45 power 5 schools. The Big East cant keep up without football.
Quote from: ThatDude on August 09, 2014, 12:39:19 PM
What makes MU different? Marquette is not in the power 5. Those power 5 schools has the ability to come together and agree on a cap for the players. What if each of those schools put 1 million dollars in the pot?
Because all of the schools can't afford that.
I think you are lacking an understanding of the basics of this ruling.
Quote from: The Sultan of Sunshine on August 09, 2014, 12:40:09 PM
Because all of the schools can't afford that.
I think you are lacking an understanding of the basics of this ruling.
I definitely understand.
Quote from: ThatDude on August 09, 2014, 12:39:19 PM
What makes MU different? Marquette is not in the power 5. Those power 5 schools has the ability to come together and agree on a cap for the players. What if each of those schools put 1 million dollars in the pot?
Look at it like running a franchise. The Yankees are the 45 power 5 schools. The Big East cant keep up without football.
You just made a case for why MU is a big winner ... If the power 5 cap pay to players, the Big East, not a power 5 conference, can choose to not cap or a bigger cap and outbid.
The Big East can wait until the power 5 decide and then write their rules to advantage themselves.
Quote from: El Guerrero on August 08, 2014, 11:34:08 PM
Where did this $5k cap come from? Did this judge just pull it out of thin air?
Its a 5,000 per year MINIMUM
Quote from: Heisenberg on August 09, 2014, 12:50:32 PM
The Big East can wait until the power 5 decide and then write their rules to advantage themselves.
Thats true, but lets not forget that football is the breadwinner in the house. Without football the Big East cant compete financially with the power 5.
But you are right, our one advantage we have at this moment is to wait and react off of the power 5 plans.
Quote from: ThatDude on August 09, 2014, 12:59:20 PM
Thats true, but lets not forget that football is the breadwinner in the house. Without football the Big East cant compete financially with the power 5.
But you are right, our one advantage we have at this moment is to wait and react off of the power 5 plans.
Football is not going to subsidize basketball, or any other sport, anymore. Football will be in an arms race with each other.
If anything, the Kentucky's and UNCs of the world might take basketball money to feed the football monster, because football is way more important.
Quote from: ThatDude on August 09, 2014, 12:59:20 PM
Thats true, but lets not forget that football is the breadwinner in the house. Without football the Big East cant compete financially with the power 5.
But the power 5 are going to spend all of that money on football. NOT basketball. Because we don't have the burden of football, we will be able to outspend the power 5 in the only we sport we really care about.
Quote from: ChicosBailBonds on August 09, 2014, 12:19:58 PM
I'm at a volleyball camp right now with my son...run by former gold medalist Pat Powers....they're talking up scholarships and all that stuff. Talking about all the growing opportunities for sand volleyball and indoor in college, but yesterday's ruling has them worried as some schools that were looking to add may not any longer. Others may drop. For some of these people investing 1000's of dollars a year in training, camps, club, etc, the reality was sinking in a bit with the talk this morning.
Be careful what you wish for, you just might get it.
As calloused as this sounds, I really don't care. I don't think any student has a right to a free (or discounted) education because they are good at a sport. Whether it be sand volleyball, soccer, football, basketball, etc. I was varsity in ultimate frisbee in high school and won three state championships. No one offered me a scholarship. Why should sand volleyball players get one? If a sport wants the ability to offer free (or discounted) educations, than they need to prove they bring enough benefit to the university to justify the cost of the scholarship. Men's basketball, football, baseball, hockey (for some schools), volleyball (for some schools), lacrosse (for some schools) and soccer (for some schools) have done that.
If sand volleyball wants scholarships, find a way to prove their value to the university, or be happy being added as one of the extra sports that only exist because the NCAA says we need at least 14 different sports and Title IX wills it to be a 7-7 or 6-8 split.
Quote from: ThatDude on August 09, 2014, 12:51:01 PM
Its a 5,000 per year MINIMUM
Yes that is the minimum cap. Which means the NCAA can cap it at $5k.
Quote from: TAMU Eagle on August 09, 2014, 01:26:32 PM
As calloused as this sounds, I really don't care. I don't think any student has a right to a free (or discounted) education because they are good at a sport. Whether it be sand volleyball, soccer, football, basketball, etc. I was varsity in ultimate frisbee in high school and won three state championships. No one offered me a scholarship. Why should sand volleyball players get one? If a sport wants the ability to offer free (or discounted) educations, than they need to prove they bring enough benefit to the university to justify the cost of the scholarship. Men's basketball, football, baseball, hockey (for some schools), volleyball (for some schools), lacrosse (for some schools) and soccer (for some schools) have done that.
If sand volleyball wants scholarships, find a way to prove their value to the university, or be happy being added as one of the extra sports that only exist because the NCAA says we need at least 14 different sports and Title IX wills it to be a 7-7 or 6-8 split.
The non-revenue sports will need to find patrons. As I mentioned in another post:
* Augusta and the USTA can donate to the NCAA (or another similar organization) to sponsor college Golf
* the USTA and the equipment makers can sponsor college tennis
* the running shoe and apparel makers can sponsor track and cross country
* The NHL can sponsor hockey
* MLB can sponsor baseball
And so on.
In addition wealthy donors can sponsor non-revenue sports at individual schools.
What the schools will do is pick up the tab for existing facilities. So if a university already has a tennis complex (indoor and outdoor courts), they will continue to upkeep it. The money from the USTA, equipment sponsors, wealthy donors will go to coaches salaries, scholarships and travel.
You watch, players will get paid and the non-revenue sports will be just fine.
Quote from: TAMU Eagle on August 09, 2014, 01:26:32 PM
As calloused as this sounds, I really don't care. I don't think any student has a right to a free (or discounted) education because they are good at a sport. Whether it be sand volleyball, soccer, football, basketball, etc. I was varsity in ultimate frisbee in high school and won three state championships. No one offered me a scholarship. Why should sand volleyball players get one? If a sport wants the ability to offer free (or discounted) educations, than they need to prove they bring enough benefit to the university to justify the cost of the scholarship. Men's basketball, football, baseball, hockey (for some schools), volleyball (for some schools), lacrosse (for some schools) and soccer (for some schools) have done that.
If sand volleyball wants scholarships, find a way to prove their value to the university, or be happy being added as one of the extra sports that only exist because the NCAA says we need at least 14 different sports and Title IX wills it to be a 7-7 or 6-8 split.
Same would go for football and basketball...no one offered you a scholarship so why should they get one...right? Let's not forget, at many of these schools, sports is actually a negative resource and loses money. Can argue this all day on those lines. Why should the music kid get a scholarship just because he's good at the flute? So on and so forth.
So let's play in the world that exists. Schools have athletic departments with athletic teams, not just 1 or 2 teams, but many teams. Those teams represent the school in athletic competitions and scholarships are rewarded. Those opportunities are going to go away, they just are. For my son, doesn't mean a thing. Number one, he's a male and there are very few male scholarships to begin with for volleyball and he'll never have the size anyway to get awarded one. So, for us, not a big deal. He's at the camp to have fun, polish his skills, check out the hot chicks, etc. For some of these kids, however, a very big deal. Their families are betting (right or wrong) on spending a few thousand dollars a year, tons of time in hopes Suzie Q gets a scholarship to avoid having to spend $20K a year for 4 to 5 years. A wise bet? Probably not, but a bet they are taking. Those opportunities are going away, just the reality of it all.
If we want to seriously get into a debate about who merits it and who doesn't, we could have a real fun one on ROI and revenue brought in on the political side if you wish. ;)
Quote from: Heisenberg on August 09, 2014, 03:37:47 PM
The non-revenue sports will need to find patrons. As I mentioned in another post:
* Augusta and the USTA can donate to the NCAA (or another similar organization) to sponsor college Golf
* the USTA and the equipment makers can sponsor college tennis
* the running shoe and apparel makers can sponsor track and cross country
* The NHL can sponsor hockey
* MLB can sponsor baseball
And so on.
In addition wealthy donors can sponsor non-revenue sports at individual schools.
What the schools will do is pick up the tab for existing facilities. So if a university already has a tennis complex (indoor and outdoor courts), they will continue to upkeep it. The money from the USTA, equipment sponsors, wealthy donors will go to coaches salaries, scholarships and travel.
You watch, players will get paid and the non-revenue sports will be just fine.
Very few highly qualified tennis players play one lick of college tennis. Not how the funnel works. Golf's governing body is going to do very little for this. Could some sponsors, sure.
So let me know who is going to fund softball, fencing, cross country, track and field, lacrosse, etc, etc. Will an elite track school do fine? Sure. Will the average track school? Not a chance. Those are still slotted opportunities for young men and women to get an education paid or partially paid for. Think the broad picture realities, not where a few schools will benefit, and I think you will come to a much different conclusion when the realities set it.
Quote from: ThatDude on August 09, 2014, 12:51:01 PM
Its a 5,000 per year MINIMUM
No, it is capped at a MAXIMUM payout of $5K per year.
"It is a triumph in the sense that players will now for the first time be able to collect money for what they do. But it is far from the triumph the players and their lawyers envisioned when they began this quest five years ago.The payment authorized by Judge Wilken in the formal injunction is capped at $5,000 per athlete per year of competition. Her ruling says the NCAA is restrained from prohibiting an athlete from getting deferred compension of $5,000 or less (currently, an athlete gets nothing). In a typical NCAA career of five years, a player could collect only $25,000. In their attempt to gain a share of TV revenue for live broadcasts of their games, the players were not thinking of thousands of dollars, they were thinking of hundreds of thousands of dollars. Instead of allowing the players to use their leverage to collect a large portion of huge television contracts."In many ways, the NCAA is relieved the cap is at $5K. You may see a scenario here where both sides appeal. The plaintiffs are pissed at the $5K cap, the NCAA pissed at the anti-trust ruling and the fact the each player signed a waiver allowing the NCAA to use their likeness in promoting their sports.
Quote from: ChicosBailBonds on August 09, 2014, 05:14:45 PM
Same would go for football and basketball...no one offered you a scholarship so why should they get one...right? Let's not forget, at many of these schools, sports is actually a negative resource and loses money. Can argue this all day on those lines. Why should the music kid get a scholarship just because he's good at the flute? So on and so forth.
I agree. No one deserves a scholarship just because they are good at something. They deserve it because they bring enough ROI to the university. Football and basketball for most schools brings a positive ROI. Academics bring a positive ROI. Depending on the school, music can bring a positive ROI. Many of the non-revenue sports? Not a positive ROI. I don't feel bad about cutting them.
Quote from: TAMU Eagle on August 09, 2014, 11:40:16 PM
I agree. No one deserves a scholarship just because they are good at something. They deserve it because they bring enough ROI to the university. Football and basketball for most schools brings a positive ROI. Academics bring a positive ROI. Depending on the school, music can bring a positive ROI. Many of the non-revenue sports? Not a positive ROI. I don't feel bad about cutting them.
When did ROI become the standard? If it was most humanities and liberal arts education would be eliminated. According to the AD of Michigan, only 20 to 25 D1 football programs make money, now with this ruling, that will go down. You think we are going to 20 D1 football schools? We would if ROI was the standard.
It's about priorities. If non-revenue sports are important to a school, they will keep them. Why are they important? Because non-revenue athletes are better than average students, graduate in higher percentages and donate more than the average student.
Simply put, non-revenue sport athletes are "better" students than "regular" students and they are worth the investment. Just like kids with high test scores and/or GPAs are offered incentives to attend. They are worth the investment too.
Quote from: TAMU Eagle on August 09, 2014, 11:40:16 PM
I agree. No one deserves a scholarship just because they are good at something. They deserve it because they bring enough ROI to the university. Football and basketball for most schools brings a positive ROI. Academics bring a positive ROI. Depending on the school, music can bring a positive ROI. Many of the non-revenue sports? Not a positive ROI. I don't feel bad about cutting them.
It would be interesting if they used your standard for social programs in this country.....lots of people doing absolutely nothing and getting paid to do NOTHING. We make those decisions as a society, perhaps with the hope that some of these folks will see the light and get it in gear. At least these kids are working their butts off to represent their schools, excel at their sport, earning minimum grades to stay eligible (often much much higher than minimum).
How would you respond to the basketball and football schools that have a negative ROI....should those schools kill the sports because their revenues do not exceed expenses?
Furthermore, aren't you short changing your ROI? How many of these kids that are not bringing in revenue immediately for the school end up graduating, going on to great things, give back to the school in many ways?
Quote from: Heisenberg on August 10, 2014, 09:31:21 AM
When did ROI become the standard? If it was most humanities and liberal arts education would be eliminated. According to the AD of Michigan, only 20 to 25 D1 football programs make money, now with this ruling, that will go down. You think we are going to 20 D1 football schools? We would if ROI was the standard.
This data is incomplete. Yes, only 20 to 25 football programs make money. But they more than make up for it in the alumni donations they create, the students they attract, the connection they create with the students (successful athletic programs have been proven to help increase student retention and persistence to graduation), the free marketing, and the prestige that they bring. You can't just look at if the football program balances the budget or not.
Quote from: ChicosBailBonds on August 10, 2014, 10:32:53 AM
It would be interesting if they used your standard for social programs in this country.....lots of people doing absolutely nothing and getting paid to do NOTHING. We make those decisions as a society, perhaps with the hope that some of these folks will see the light and get it in gear. At least these kids are working their butts off to represent their schools, excel at their sport, earning minimum grades to stay eligible (often much much higher than minimum).
Without wading into politics on a basketball forum I would say that there is a HUGE difference between basic human needs and getting a free or discounted college education because a kid is good at tossing a ball around.
Quote from: ChicosBailBonds on August 10, 2014, 10:32:53 AM
How would you respond to the basketball and football schools that have a negative ROI....should those schools kill the sports because their revenues do not exceed expenses?
Furthermore, aren't you short changing your ROI? How many of these kids that are not bringing in revenue immediately for the school end up graduating, going on to great things, give back to the school in many ways?
See my response to Heisenberg. I think you find that very few football and basketball programs have a true negative ROI. And if they did, my response would be the same as it is to the sand volleyball team, cut it.
And sure, there are many kids who are on a swimming scholarship or something similar that go on to do great things. I would argue that there is just as much likelihood that a kid on an academic scholarship would do the same thing. Only difference is that the academic scholarship doesn't come with the extra cost of coaches, facilities, travel budgets, tutors, etc. My response? Cut the swim team, put that money into academic scholarships (And I am aware it is not that simple, I am merely making a simple argument to make a point).
Change is coming to higher education. The blank check that is federal student loans will be reformed and be much harder to come by in the near future. Colleges are going to have to tighten their belts across all of their departments. Athletics is probably the department that most consistently has an over inflated budget across multiple universities. They should be one of the departments that takes the greatest hit. And I say this as someone who works in college athletics.
Quote from: TAMU Eagle on August 10, 2014, 11:31:11 AM
See my response to Heisenberg. I think you find that very few football and basketball programs have a true negative ROI. And if they did, my response would be the same as it is to the sand volleyball team, cut it.
And sure, there are many kids who are on a swimming scholarship or something similar that go on to do great things. I would argue that there is just as much likelihood that a kid on an academic scholarship would do the same thing. Only difference is that the academic scholarship doesn't come with the extra cost of coaches, facilities, travel budgets, tutors, etc. My response? Cut the swim team, put that money into academic scholarships (And I am aware it is not that simple, I am merely making a simple argument to make a point).
Kids that qualify for academic scholarships get them from lots of schools. And the one they pick often is the one that sunk a ton of money into labs, buildings and facility. So, it's a as "cheap" when compared to sports scholarships. In many cases it a lot more money that paying for a cross country or tennis team.
The largest source of scholarships was the GI bill following WW2. Following that is sports scholarships, especially non-revenue sports. Again, why is that? Non-revenue sports athletes have proven themselves as "more desirable" students than the general population. It is for this reason the non-revenue sports athletes will be fine ... Like they were from the 1940s to early 1990s when revenue sports did not "pay for them."
Quote from: Heisenberg on August 10, 2014, 11:56:26 AM
Kids that qualify for academic scholarships get them from lots of schools. And the one they pick often is the one that sunk a ton of money into labs, buildings and facility. So, it's a as "cheap" when compared to sports scholarships. In many cases it a lot more money that paying for a cross country or tennis team.
The largest source of scholarships was the GI bill following WW2. Following that is sports scholarships, especially non-revenue sports. Again, why is that? Non-revenue sports athletes have proven themselves as "more desirable" students than the general population. It is for this reason the non-revenue sports athletes will be fine ... Like they were from the 1940s to early 1990s when revenue sports did not "pay for them."
The labs and facilities make a profit for the University from research alone. If they didn't Universities wouldn't invest in them...
Strangely, the will invest in football/basketball facilities and teams knowing they will lose money on them.
Quote from: Heisenberg on August 10, 2014, 11:56:26 AM
Kids that qualify for academic scholarships get them from lots of schools. And the one they pick often is the one that sunk a ton of money into labs, buildings and facility. So, it's a as "cheap" when compared to sports scholarships. In many cases it a lot more money that paying for a cross country or tennis team.
Yes, but labs, buildings, and facilities are essential to the functioning of an institution of higher learning. A tennis team is not. Plus, those buildings, labs, and facilities have a much higher ROI (in most cases) than a non-revenue sports team.
Actually they don't ... They are huge money sucks and survive because they get federal grants for research.
Just like most sports programs are money sucks and survive because they get state funding.
Quote from: Heisenberg on August 10, 2014, 02:26:53 PM
Actually they don't ... They are huge money sucks and survive because they get federal grants for research.
Just like most sports programs are money sucks and survive because they get state funding.
Getting federal research grants is part of ROI....universities compete for these grants and the facilities help them do it. And again, you are looking too small. These facilities attract students, increase prestige, and encourage donations. And they do it a lot better than a equestrian team does.
All D1 football programs make money. Like, a whole lot of money. Anyone who thinks differently is brain dead.
As suspected, NCAA announced today they will appeal. Some politicians in some states are coming around to supporting anti-trust exemption for the NCAA.
Quote from: Boozemon Barro on August 10, 2014, 04:07:52 PM
All D1 football programs make money. Like, a whole lot of money. Anyone who thinks differently is brain dead.
Before I answer your question with actual data, and since you introduced the idea of "brain dead" and anyone not agreeing with your view as apparently not having a brain that is functioning....please define "make money and whole lot of money for us".
I've seen on way too many occasions on this site and much more on the general internet this notion of "making money" equated to revenue. It's as if a bunch of people never took a business 101 class. Revenue earned is not "made" money. When you "make money", you are making a profit, that is what is left over after expenses are deducted from revenues. So, again, I'd ask for you to define for us what you mean by make money and a whole lot of money so the appropriate answer can be given to you. I'd also ask you to take a pretty sharp look at what entails Division I football.
Quote from: ChicosBailBonds on August 10, 2014, 04:48:16 PM
Before I answer your question with actual data, and since you introduced the idea of "brain dead" and anyone not agreeing with your view as apparently not having a brain that is functioning....please define "make money and whole lot of money for us".
I've seen on way too many occasions on this site and much more on the general internet this notion of "making money" equated to revenue. It's as if a bunch of people never took a business 101 class. Revenue earned is not "made" money. When you "make money", you are making a profit, that is what is left over after expenses are deducted from revenues. So, again, I'd ask for you to define for us what you mean by make money and a whole lot of money so the appropriate answer can be given to you. I'd also ask you to take a pretty sharp look at what entails Division I football.
+1
Every D1 football program generates revenue, but all but the top 20 to 25 have expenses greater than their revenues.
Quote from: ChicosBailBonds on August 09, 2014, 12:19:58 PM
I'm at a volleyball camp right now with my son...run by former gold medalist Pat Powers....they're talking up scholarships and all that stuff. Talking about all the growing opportunities for sand volleyball and indoor in college, but yesterday's ruling has them worried as some schools that were looking to add may not any longer. Others may drop. For some of these people investing 1000's of dollars a year in training, camps, club, etc, the reality was sinking in a bit with the talk this morning.
Be careful what you wish for, you just might get it.
My sense is the combination of the O'Bannon Ruling and The Power 5 deal will cost Marquette 150k more a year to compete in men's and woman's basketball (making the Title IX assumption) I don't believe it will have a material impact on other sports at Marquette. Players currently sign waivers to allow Marquette to use their images. So most of this cost will be in the form of enhanced scholarship value.
I don't think there are many college athletes that can truly command image marketing dollars. It is the school brand they care about. In some rare circumstances there may be the iconic college athlete such as a Doug Flutie Herschel Walker Bo Jackson etc that transcends their school and they will be compensated for their use of their images post graduation for sure. In general I dont think this will be a big deal, the ruling will be appealed and subsequently modified to keep the collegiate model intact.
I think the Olympic sports will all be fine. I truly believe the cost of these sports is in the eyes of the beholder. The big D1 schools tend to label them non revenue etc for their own parochial reasons. On the other hand D3 can't add these sports fast enough. As they attract tuition paying students and don't have very much attendant costs. Even in D1 do the math on a typical Mens Lacrosse program. They have around 48 guys on a team and 12.6 scholarships. So your looking at 35 full tuition's. All of the equipment apparel is provided by the manufacturers who sponsor the teams. So your net cost is a few coaches, a travel budget for the team and recruiting. The fields etc are already there. The same math applies to soccer baseball etc.
Some smaller schools have almost 20 percent of their students involved in intercollegiate athletics. Having a broad range of sports adds to the fabric of the schools and over a long period of time is a tremendous investment. These student athletes tend to have above average post graduate career trajectory.
The other reality is that in most Olympic sports students are generally using them to get into schools that they would ordinarily not be able to gain acceptance to. If for some reason the scholarships were reduced because of these rulings and agreements, you would simply see a a handful but not all students who play these sports, matriculating to their in state schools or those with lower admissions standards.
Bottom Line is we need to raise a few more dollars for our athletic department and there is a possibility if we are smart about it we can use these rulings to our advantage. We don't have to feed the football monster and that makes a huge difference.
Quote from: Texas Western on August 10, 2014, 06:17:36 PM
I don't think there are many college athletes that can truly command image marketing dollars. It is the school brand they care about. In some rare circumstances there may be the iconic college athlete such as a Doug Flutie Herschel Walker Bo Jackson etc that transcends their school and they will be compensated for their use of their images post graduation for sure. In general I dont think this will be a big deal, the ruling will be appealed and subsequently modified to keep the collegiate model intact.
Good post
One small quibble, the iconic athletes are not just guys who played 30 years ago but more current ... Johnny Manziel, Jamies Winston, Denard Robinson, Tim Tebow, Doug McDermott, Anthony Davis, etc. So I think the issue matters to current players not just to players from 30 years ago.
Quote from: Texas Western on August 10, 2014, 06:17:36 PM
I think the Olympic sports will all be fine. I truly believe the cost of these sports is in the eyes of the beholder. The big D1 schools tend to label them non revenue etc for their own parochial reasons. On the other hand D3 can't add these sports fast enough. As they attract tuition paying students and don't have very much attendant costs. Even in D1 do the math on a typical Mens Lacrosse program. They have around 48 guys on a team and 12.6 scholarships. So your looking at 35 full tuition's. All of the equipment apparel is provided by the manufacturers who sponsor the teams. So your net cost is a few coaches, a travel budget for the team and recruiting. The fields etc are already there. The same math applies to soccer baseball etc.
D3 is adding them because they don't fund any scholarships for them. So the expenses are $0 while revenue on the academic side is through the roof for tuition. For D1, it's the exact opposite. For women's sports, it is more pronounced. I understand and agree with your Lacrosse example, but I would not agree with it for women's volleyball, women's tennis, women's basketball, so on and so forth.
For example, women's volleyball has 12 full head count scholarships...the team has 16 players.
Women's basketball, 15 full head count scholarships...the team has 14 players on the roster currently
Women's tennis, 8 scholarships....the MU team has 6 players on the roster
Etc, etc. So yes, it works out with the math in some sports, but much differently in others.
The next question you would have to ask in your model is how many of those lacrosse players are accretive to the university? In other words, if MU didn't have a lacrosse program, would those slots have been unfilled or would other students (non lacrosse players) been admitted anyway and chosen to come to MU to pay tuition?
Quote from: forgetful on August 08, 2014, 10:12:54 PM
Per the actual ruling, they could actually just reduce the value of a scholarship by $5000 and then impose a $5000 maximum cap on the payments.
The athletes would then have no additional benefit from the ruling.
Fine. Then we acknowledge what the scholarship is AND TAX IT.
It is a barter transaction. And under IRS rules, it is taxable!
Quote from: TAMU Eagle on August 10, 2014, 11:31:11 AM
Without wading into politics on a basketball forum I would say that there is a HUGE difference between basic human needs and getting a free or discounted college education because a kid is good at tossing a ball around.
See my response to Heisenberg. I think you find that very few football and basketball programs have a true negative ROI. And if they did, my response would be the same as it is to the sand volleyball team, cut it.
And sure, there are many kids who are on a swimming scholarship or something similar that go on to do great things. I would argue that there is just as much likelihood that a kid on an academic scholarship would do the same thing. Only difference is that the academic scholarship doesn't come with the extra cost of coaches, facilities, travel budgets, tutors, etc. My response? Cut the swim team, put that money into academic scholarships (And I am aware it is not that simple, I am merely making a simple argument to make a point).
Change is coming to higher education. The blank check that is federal student loans will be reformed and be much harder to come by in the near future. Colleges are going to have to tighten their belts across all of their departments. Athletics is probably the department that most consistently has an over inflated budget across multiple universities. They should be one of the departments that takes the greatest hit. And I say this as someone who works in college athletics.
Should people not be required to do a few things for those basic human needs?
I think you are way overselling the value of all college football and basketball programs. Do you think the basketball program at Mississippi Valley State is helping to bring in a bunch of donations? How about VMI's? How about NJIT? In fact, let's look at the bottom 100 DI schools just for starters. Then look at all the DII schools, DIII schools, etc. People continue to make the mistake here and elsewhere of thinking about the top schools and conferences, not the actual majority of schools. We on this board are sports fans, but the average Joe doesn't give a damn about their school's sports teams, and many have negative reactions to them.
Of course, for big schools, the name recognition, a trip to a bowl game or the Final Four can be beneficial in terms of donations, etc. How many schools get to go to the Final Four over a 20 year period? That's 80 slots, but I'm guessing it is taken up by about 30 to 40 schools as so many of them repeat the occurrence. Take a look at the attendance for most schools, take a look at the student ticket purchases that number in the 100's because so few care.
We should be careful about assigning ROIs to some of these by using the prism of big time sports when most college programs are not big time, let alone the sports within.
Quote from: ChicosBailBonds on August 11, 2014, 12:01:22 AM
Should people not be required to do a few things for those basic human needs?
I think you are way overselling the value of all college football and basketball programs. Do you think the basketball program at Mississippi Valley State is helping to bring in a bunch of donations? How about VMI's? How about NJIT? In fact, let's look at the bottom 100 DI schools just for starters. Then look at all the DII schools, DIII schools, etc. People continue to make the mistake here and elsewhere of thinking about the top schools and conferences, not the actual majority of schools. We on this board are sports fans, but the average Joe doesn't give a damn about their school's sports teams, and many have negative reactions to them.
Of course, for big schools, the name recognition, a trip to a bowl game or the Final Four can be beneficial in terms of donations, etc. How many schools get to go to the Final Four over a 20 year period? That's 80 slots, but I'm guessing it is taken up by about 30 to 40 schools as so many of them repeat the occurrence. Take a look at the attendance for most schools, take a look at the student ticket purchases that number in the 100's because so few care.
We should be careful about assigning ROIs to some of these by using the prism of big time sports when most college programs are not big time, let alone the sports within.
Chicos...I'm also not going to get into politics discussions here.
But a key detail in evaluating these things in relation to the ROI, is do they serve the mission of the organization. And would removing them negatively deter from the overall goals of the mission.
Schools have philosophy departments and religious studies departments (money losers), because removing them would detract from the overall mission of providing a broad based education.
Now sports...don't directly serve the mission, so they must either recoup the investment directly as profits or indirectly through other means. You are right to question the value of football/basketball to Mississippi Valley State University. But answer me this...why do you even know the school exists? Sports...and that is how they serve the mission.
Even just casual sports fans or through family that is a casual sports fans observations of a school existing (through sports), particularly small schools, increases the number of applicants. Several small schools have attempted to drop football/basketball, but lost that name recognition (far more loss than they expected).
It turns out that even having the worst football/basketball program in the nation, adds applicants. So quality is not essential, but existence is.
Quote from: forgetful on August 11, 2014, 12:20:41 AM
Chicos...I'm also not going to get into politics discussions here.
But a key detail in evaluating these things in relation to the ROI, is do they serve the mission of the organization. And would removing them negatively deter from the overall goals of the mission.
Schools have philosophy departments and religious studies departments (money losers), because removing them would detract from the overall mission of providing a broad based education.
Now sports...don't directly serve the mission, so they must either recoup the investment directly as profits or indirectly through other means. You are right to question the value of football/basketball to Mississippi Valley State University. But answer me this...why do you even know the school exists? Sports...and that is how they serve the mission.
Even just casual sports fans or through family that is a casual sports fans observations of a school existing (through sports), particularly small schools, increases the number of applicants. Several small schools have attempted to drop football/basketball, but lost that name recognition (far more loss than they expected).
It turns out that even having the worst football/basketball program in the nation, adds applicants. So quality is not essential, but existence is.
Actually, there have been studies that have also shown some schools that dropped football actually INCREASED applications. It goes both ways.
http://csri-jiia.org/documents/puclications/research_articles/2014/JIIA_2014_7_05_92_113_Discontinuin_Football.pdf
I know Miss Valley State because I do this crap for a living and know most of the schools. Most average Joes have no idea the school exists, absolutely none. Many casual sports fans have no idea.
Believe me, I get your argument and think it has some merits, but I don't think it is that cut and dried. It's a lot like cities that can't wait to get a NBA team because they want to swing their pecker around and show how big the city is now. The reality is that plenty of cities without a team do just fine. It's a prestige game, and that is no different in college athletics. They feel if they have a D1 program, it helps validate their status. Whether it truly does or not is up for debate. For many of these schools, they feel having their name opposite some powerhouse school and getting drubbed by 40 points at least puts them in the conversation. Does that truly lead to applications? Quality applications? Donations? Different studies tell you different things.
Look, I know about schools like Case Western Reserve, Concordia in Irvine, Chapman, Ashland, Allegheny, Colby, etc, etc. None of those schools have D1 sports at all, still good schools, doing well, thriving....many folks have never heard of them either. Sports can be a great tool, but it is hardly the end all be all in name recognition for a school, especially as it relates to its mission...as you state. It CAN be used to get the name out, but the question is how many schools does it truly do that for and at what cost?
Quote from: El Guerrero on August 08, 2014, 11:34:08 PM
Where did this $5k cap come from? Did this judge just pull it out of thin air?
The most important point in the discussion and the opening to the next round?
Quote from: Class71 on August 11, 2014, 05:31:03 AM
The most important point in the discussion and the opening to the next round?
The most important part is they moved off zero ... "we know what you are, we are just negotiating the price."
And, has been mentioned here before, eventually it will all be taxable, all of it.
What the judged ruled is that no one can collude to set a scholarship level at anything less than cost of attendance. And that basketball and football players have a right to their name, image and likeness. However the NCAA does have a compelling reason, mostly based on integration of the student athlete into the student body as a whole, that they don't earn too much money while in college. Therefore they can set a cap on these earnings, but that cap cannot be less than $5,000. So yeah...it is a little whacked. But that's how a lot of these decisions are made these days.
So as I understand it, this is how this works out.
**Athletic scholarships at any level cannot be set at less then full cost of attendance.
**Name, image, likeness payments cannot be set at less than $5,000 per year.
Right now I believe this ruling only applies to D1 basketball and football, but I am sure at some point the schools will get together and figure out what to do because I am sure the NCAA isn't going to win this on appeal.
The judge ruled that the NCAA's basic arguments were hogwash. That the marketplace enjoys college athletic because they are amateurs. (Uh...no.) And that it will impact competitive balance. (If the NCAA was so concerned about competitive balance, why haven't they done anything meaningful with regards to profit sharing?)
Chicos is playing this out as some sort of liberal, activist judge. I think this is hardly that. This is a judge that is by and large letting the free market speak more than anything.
Quote from: Heisenberg on August 10, 2014, 05:49:02 PM
+1
Every D1 football program generates revenue, but all but the top 20 to 25 have expenses greater than their revenues.
If you are going to urge others to be careful with stats and info you should be as well. The top 20 to 25 team statistic is relative to the football program being a stand alone entity and making a profit. That stat all depends on what accounting and budgeting principles you apply to the data. The top 50% of D1 revenue sports (basketball/football) make a profit if accounted for as as part of the larger budget but as an individual entity do not. Also lost in the calculation are the donations to both the athletic department and school as a whole that result for the revenue sports.
The AD sites a stat like that because it serves his purpose and message. Is it true, sure in the pure sense, but it's all a matter of perspective
Quote from: mu03eng on August 11, 2014, 10:05:01 AM
If you are going to urge others to be careful with stats and info you should be as well. The top 20 to 25 team statistic is relative to the football program being a stand alone entity and making a profit. That stat all depends on what accounting and budgeting principles you apply to the data. The top 50% of D1 revenue sports (basketball/football) make a profit if accounted for as as part of the larger budget but as an individual entity do not. Also lost in the calculation are the donations to both the athletic department and school as a whole that result for the revenue sports.
Exactly. And this is why it is very difficult to say how "profitable" not only football or intercollegiate athletics is, but frankly any unit within a University. I mean, how "profitable" is the physics department?
I tend to look at it this way. If athletics wasn't generating some sort of value added a bunch of schools wouldn't be engaging in that activity. It is most definitely possible that an individual school is making a misguided investment in athletics, and that it really isn't generating a value add, but I doubt hundreds of schools are making the same miscalculation. I mean, there isn't a Division 3 athletic program in the country that turns an operational profit.
So the value of athletics isn't just about if it is generating an operational profit. But how does it help develop the school's brand? How much does it help with admissions? Donations? How many visitors does it bring to campus?
Quote from: ChicosBailBonds on August 11, 2014, 12:01:22 AM
Should people not be required to do a few things for those basic human needs?
I think you are way overselling the value of all college football and basketball programs. Do you think the basketball program at Mississippi Valley State is helping to bring in a bunch of donations? How about VMI's? How about NJIT? In fact, let's look at the bottom 100 DI schools just for starters. Then look at all the DII schools, DIII schools, etc. People continue to make the mistake here and elsewhere of thinking about the top schools and conferences, not the actual majority of schools. We on this board are sports fans, but the average Joe doesn't give a damn about their school's sports teams, and many have negative reactions to them.
Of course, for big schools, the name recognition, a trip to a bowl game or the Final Four can be beneficial in terms of donations, etc. How many schools get to go to the Final Four over a 20 year period? That's 80 slots, but I'm guessing it is taken up by about 30 to 40 schools as so many of them repeat the occurrence. Take a look at the attendance for most schools, take a look at the student ticket purchases that number in the 100's because so few care.
We should be careful about assigning ROIs to some of these by using the prism of big time sports when most college programs are not big time, let alone the sports within.
Yes, but again, not a politics forum.
I don't think you see my point. If all that is true about Mississippi Valley State, then they should cut their basketball team. But they should cut their sand volleyball team first.(Assuming it has a lower roi)
If I could, I would cut every low roi program in the nation. It could potentially save higher education as we know it.
If you don't benefit the academic mission of the university, you don't deserve an academic scholarship imho. Marquette basketball does that, Marquette tennis does not.
Something I posted in November 2012.
http://www.muscoop.com/index.php?topic=34465.msg421983#msg421983
---------------------------------
[In mid-November 2012] 60 Minutes did a story on college football.
http://www.cbsnews.com/video/watch/?id=50135410n
http://www.cbsnews.com/8301-18560_162-57551556/has-college-football-become-a-campus-commodity/
In it they flat out stated the purpose of football is to raise the profile of the school. That is mission 1. Mission 2 is to make Alums feel good about the school so they donate.
Most interesting is this statement by Dave Brandon, former CEO of Dominos Pizza and now Michigan AD ...
-----
Dave Brandon: The business model of big-time college athletics is primarily broken. It's, it's a horrible business model.
Armen Keteyian: Broken.
Dave Brandon: Broken. You've got 125 of these programs. Out of 125, 22 of them were cash flow even or cash flow positive. Now, thankfully, we're one of those. What that means is you've got a model that's not sustainable in most cases. You just don't have enough revenues to support the costs. And the costs continue to go up.
Why? A big reason is universities are in the midst of a sports building binge. Cal Berkeley, for example, renovated its stadium to the tune of $321 million. The list is endless. Michigan's athletic department floated $226 million in bonds to upgrade the Big House.
-----
I assume the "125" he was talking about is actually the 127 schools that make up the FBS. Only 22 are cash-flow positive. That's it!
This is why TAMU's "Return on Investment" idea is wrong. Under this approach virtually all college sports, revenue and non-revenue would be abandoned. With few exceptions, they cost more than they bring in. And, as Sultan noted, so would the Physics program, theater program and most humanities and liberal arts programs. The purpose of a University is not to make money. We have a separate category of "for-profit schools" ... none of which are NCAA members.
What the schools are doing is taking more of a "value added" approach that Sultan suggests. They lose tons of money in football as it raises the profile of the school and makes alums feel good about themselves. They have non-revenue sports because they think it attracts a type of student that they want at their school (as I have noted before non-revenue athletes have grades, graduation and donation as alums, that are better than the general student population).
Quote from: Heisenberg on August 11, 2014, 11:26:05 AM
Something I posted in November 2012.
http://www.muscoop.com/index.php?topic=34465.msg421983#msg421983
---------------------------------
[In mid-November 2012] 60 Minutes did a story on college football.
http://www.cbsnews.com/video/watch/?id=50135410n
http://www.cbsnews.com/8301-18560_162-57551556/has-college-football-become-a-campus-commodity/
In it they flat out stated the purpose of football is to raise the profile of the school. That is mission 1. Mission 2 is to make Alums feel good about the school so they donate.
Most interesting is this statement by Dave Brandon, former CEO of Dominos Pizza and now Michigan AD ...
-----
Dave Brandon: The business model of big-time college athletics is primarily broken. It's, it's a horrible business model.
Armen Keteyian: Broken.
Dave Brandon: Broken. You've got 125 of these programs. Out of 125, 22 of them were cash flow even or cash flow positive. Now, thankfully, we're one of those. What that means is you've got a model that's not sustainable in most cases. You just don't have enough revenues to support the costs. And the costs continue to go up.
Why? A big reason is universities are in the midst of a sports building binge. Cal Berkeley, for example, renovated its stadium to the tune of $321 million. The list is endless. Michigan's athletic department floated $226 million in bonds to upgrade the Big House.
-----
I assume the "125" he was talking about is actually the 127 schools that make up the FBS. Only 22 are cash-flow positive. That's it!
This is why TAMU's "Return on Investment" idea is wrong. Under this approach virtually all college sports, revenue and non-revenue would be abandoned. With few exceptions, they cost more than they bring in. And, as Sultan noted, so would the Physics program, theater program and most humanities and liberal arts programs. The purpose of a University is not to make money. We have a separate category of "for-profit schools" ... none of which are NCAA members.
What the schools are doing is taking more of a "value added" approach that Sultan suggests. They lose tons of money in football as it raises the profile of the school and makes alums feel good about themselves. They have non-revenue sports because they think it attracts a type of student that they want at their school (as I have noted before non-revenue athletes have grades, graduation and donation as alums, that are better than the general student population).
Hberg,
You have made the same point about 22 out of 125 football programs making a profit at least three times, and I have responded all three times. ROI does NOT mean the same thing as profit. Profit=revenue-cost. ROI includes profit AND all of the additional benefits not covered by profit. Things like donations, increased applications, increased tuition revenue, increased persistence to graduation, increased student retention, increased student satisfaction, etc. ROI is NOT limited to money. Don't think about it in terms of dollar signs.
When you base it on true ROI, all of the 127 fbs schools are in the green. (Whether or not they would be more in the green without football is another question). As well as a significant amount of the basketball only schools.
Quote from: Heisenberg on August 10, 2014, 09:31:21 AM
When did ROI become the standard? If it was most humanities and liberal arts education would be eliminated. According to the AD of Michigan, only 20 to 25 D1 football programs make money, now with this ruling, that will go down. You think we are going to 20 D1 football schools? We would if ROI was the standard.
Using real bookkeeping or MLB-style bookkeeping?
Quote from: TAMU Eagle on August 11, 2014, 11:55:41 AM
You have made the same point about 22 out of 125 football programs making a profit at least three times, and I have responded all three times. ROI does NOT mean the same thing as profit. Profit=revenue-cost. ROI includes profit AND all of the additional benefits not covered by profit.
One of the problems with athletic programs, as TAMU has pointed out in the past, is how is the accounting done? The contributions are revenue, but in a school like Michigan, if I give to the "M" Fund, how is that money allocated to the football or basketball program? Where do the costs go? The allocation is everything.
You also may want to ask, what are the accruals and amortizatons? How is the cost of the Big House's renovation handled? Is it on a 20, 30 or even 40 year amort schedule? That has a lot to do with the profitability.
My point is there is no consistent equivalent of GAAP for College Athletic programs. Most every school does it differently which is a huge burden in making effective comparisons.
A final thought: Where would Marquette be without basketball? Certainly some of the cost of our basketball program could and probably should be borne by university marketing. Without basketball, we'd be a small regional college in Milwaukee and the robust nature of today's campus, today's student body and today's vision would be at best muted. I think every NCAA school thinks the same way.
Quote from: Heisenberg on August 11, 2014, 11:26:05 AM
Something I posted in November 2012.
http://www.muscoop.com/index.php?topic=34465.msg421983#msg421983
---------------------------------
[In mid-November 2012] 60 Minutes did a story on college football.
http://www.cbsnews.com/video/watch/?id=50135410n
http://www.cbsnews.com/8301-18560_162-57551556/has-college-football-become-a-campus-commodity/
In it they flat out stated the purpose of football is to raise the profile of the school. That is mission 1. Mission 2 is to make Alums feel good about the school so they donate.
Most interesting is this statement by Dave Brandon, former CEO of Dominos Pizza and now Michigan AD ...
-----
Dave Brandon: The business model of big-time college athletics is primarily broken. It's, it's a horrible business model.
Armen Keteyian: Broken.
Dave Brandon: Broken. You've got 125 of these programs. Out of 125, 22 of them were cash flow even or cash flow positive. Now, thankfully, we're one of those. What that means is you've got a model that's not sustainable in most cases. You just don't have enough revenues to support the costs. And the costs continue to go up.
Why? A big reason is universities are in the midst of a sports building binge. Cal Berkeley, for example, renovated its stadium to the tune of $321 million. The list is endless. Michigan's athletic department floated $226 million in bonds to upgrade the Big House.
-----
I assume the "125" he was talking about is actually the 127 schools that make up the FBS. Only 22 are cash-flow positive. That's it!
This is why TAMU's "Return on Investment" idea is wrong. Under this approach virtually all college sports, revenue and non-revenue would be abandoned. With few exceptions, they cost more than they bring in. And, as Sultan noted, so would the Physics program, theater program and most humanities and liberal arts programs. The purpose of a University is not to make money. We have a separate category of "for-profit schools" ... none of which are NCAA members.
What the schools are doing is taking more of a "value added" approach that Sultan suggests. They lose tons of money in football as it raises the profile of the school and makes alums feel good about themselves. They have non-revenue sports because they think it attracts a type of student that they want at their school (as I have noted before non-revenue athletes have grades, graduation and donation as alums, that are better than the general student population).
You point has been made and is technically correct, but by using your metric and only your metric Enron was a profitable and successful business.
The 22 schools stat is one way of parsing the data but to only use that methodology would be folly. Do you see Sultan, TAMU, and my point or do you contend we are incorrect?
Quote from: dgies9156 on August 11, 2014, 01:00:27 PM
One of the problems with athletic programs, as TAMU has pointed out in the past, is how is the accounting done? The contributions are revenue, but in a school like Michigan, if I give to the "M" Fund, how is that money allocated to the football or basketball program? Where do the costs go? The allocation is everything.
You also may want to ask, what are the accruals and amortizatons? How is the cost of the Big House's renovation handled? Is it on a 20, 30 or even 40 year amort schedule? That has a lot to do with the profitability.
My point is there is no consistent equivalent of GAAP for College Athletic programs. Most every school does it differently which is a huge burden in making effective comparisons.
A final thought: Where would Marquette be without basketball? Certainly some of the cost of our basketball program could and probably should be borne by university marketing. Without basketball, we'd be a small regional college in Milwaukee and the robust nature of today's campus, today's student body and today's vision would be at best muted. I think every NCAA school thinks the same way.
Not really sure what the bolded part above has to do with this. That would only affect year-over-year profitability within the same program. The allocations portion makes a ton of sense, but the Big House a football only resource so the amortization schedule would only affect expenses for football timing wise. Accruals would only have a timing effect as well.
So everyone is in agreement that college football makes tons and tons of money and any stat to the otherwise is a enron-isk lie?
And the fact that Cal-Berkeley and Michigan are spending $550 million on two stadiums means nothing when calculating the profitability of football?
On this point, all I'm arguing is college football does not make as much as you think and the only way for you to make your point is reject data and "just announce" they do.
I realize I'm derailing the whole ROI/profitability/revenue/accounting argument, but I'm convinced that O'Bannon + Big 5 Conference Autonomy will ultimately spell the end of college basketball as we know it, and I'm afraid MU will go down with the ship.
If the Big Whatever Network gives each basketball player $5k from its pool, plus they decide with their new found autonomy to increase payments (earmarked for whatever they so choose) to each player, then we have an arms race on our hands, an arms race that MU is not in a position to win.
Couple that with the pending tuition bubble collapse, and MU will have to take a long hard look at whether athletic spending (even at today's pre-O'Bannon/Autonomy Levels) is worth it. That ROI analysis (however broadly defined) will take have to take into account the fact that there may well be two subdivisions of Division 1, Big 5 and Not-Big 5.
Spending big $ on basketball and getting the exposure that comes with March is one thing. Spending big $ on basketball, but not getting the results in March is a completely different thing.
Personally, I'm hoping Wojo and Co. can make some noise while this ship goes down. Let's enjoy the next couple years, ladies and gentlemen. I'm afraid they're the last few we'll have.
Quote from: brandx on August 11, 2014, 12:14:20 PM
Using real bookkeeping or MLB-style bookkeeping?
Actually most baseball teams do not make money. Their P&L is typically zero or negative. They make it up on the escalating values of the franchise.
So real bookkeeping = MLB bookkeeping. Just because you don't like the answer, and offer no data that says otherwise does not mean it is wrong.
Quote from: lawwarrior12 on August 11, 2014, 01:52:58 PM
I realize I'm derailing the whole ROI/profitability/revenue/accounting argument, but I'm convinced that O'Bannon + Big 5 Conference Autonomy will ultimately spell the end of college basketball as we know it, and I'm afraid MU will go down with the ship.
If the Big Whatever Network gives each basketball player $5k from its pool, plus they decide with their new found autonomy to increase payments (earmarked for whatever they so choose) to each player, then we have an arms race on our hands, an arms race that MU is not in a position to win.
Couple that with the pending tuition bubble collapse, and MU will have to take a long hard look at whether athletic spending (even at today's pre-O'Bannon/Autonomy Levels) is worth it. That ROI analysis (however broadly defined) will take have to take into account the fact that there may well be two subdivisions of Division 1, Big 5 and Not-Big 5.
Spending big $ on basketball and getting the exposure that comes with March is one thing. Spending big $ on basketball, but not getting the results in March is a completely different thing.
Personally, I'm hoping Wojo and Co. can make some noise while this ship goes down. Let's enjoy the next couple years, ladies and gentlemen. I'm afraid they're the last few we'll have.
Typical scoop post!
MU/New Big East is about the best positioned basketball team/conference in the country for this change. No football, profitable basketball, great fan base, nice cash flow.
More likely Bucky is a bigger loser than MU (football will suck the life out of all other sports) ... but since that does not fit the scoop narrative that every change in life means MU is somehow screwed will not get any play.
Quote from: Heisenberg on August 11, 2014, 01:58:21 PM
Typical scoop post!
MU/New Big East is about the best positioned basketball team/conference in the country for this change. No football, profitable basketball, great fan base, nice cash flow.
More likely Bucky is a bigger loser than MU (football will suck the life out of all other sports) ... but since that does not fit the scoop narrative that every change in life means MU is somehow screwed will not get any play.
I agree of all of the positions we could be in, we're in the best. I am typically a borderline insane optimist when it comes to our prospects, have been a big proponent of the Catholic-7 Big East split, and think that we stood in a good or great position as far as the foreseeable landscape went.
The problem is that the landscape is changing, and it has the potential to change in ways that will be very bad for college basketball.
Quote from: Heisenberg on August 11, 2014, 01:53:32 PM
Actually most baseball teams do not make money. Their P&L is typically zero or negative. They make it up on the escalating values of the franchise.
So real bookkeeping = MLB bookkeeping. Just because you don't like the answer, and offer no data that says otherwise does not mean it is wrong.
See, what you are doing is repeating what the owners say without any proof. "Most baseball teams do not make money". What are you basing that on?
Strictly the word of a group of people who refuse to make their financial statements public.
You believe it because they said it. You are basing your statement on no proof whatsoever.
Hberg,
For the fourth time, ROI is not (just) about money. No one is disputing your data about 22 out of 125 not making a profit (as of 2012, according to one ad, who may or may not have had assessment to back it up). What we are saying is that football and basketball bring a lot more benefits that are not covered by the scope of profit.
Someone asked the question "where would marquette be without basketball?" The answer is probably close to where Rockhurst is now. A small, urban, academically prestigious, Jesuit, liberal arts university that no one has ever heard of and is on the verge of bankruptcy and will probably be closed in the next 25 years.
I don't remember the exact numbers but if I remember correctly, after Marquette went to the final four in 2003, donations nearly quadrupled and applications increased by 13,000. Basketball, football, volleyball, soccer, hockey, baseball, and softball have this power. (Not at all schools but for many). Tennis, swimming, golf, etc do not
Quote from: TAMU Eagle on August 11, 2014, 02:40:17 PM
Hberg,
For the fourth time, ROI is not (just) about money. No one is disputing your data about 22 out of 125 not making a profit (as of 2012, according to one ad, who may or may not have had assessment to back it up). What we are saying is that football and basketball bring a lot more benefits that are not covered by the scope of profit.
In many respects, intercollegiate athletics is similar to a marketing expense. Marketing, taken as an individual activity, is not profitable. But every company does it.
Quote from: The Sultan of Sunshine on August 11, 2014, 02:46:55 PM
In many respects, intercollegiate athletics is similar to a marketing expense. Marketing, taken as an individual activity, is not profitable. But every company does it.
Some companies do too much of it.
Quote from: TAMU Eagle on August 11, 2014, 02:40:17 PM
Hberg,
For the fourth time, ROI is not (just) about money. No one is disputing your data about 22 out of 125 not making a profit (as of 2012, according to one ad, who may or may not have had assessment to back it up). What we are saying is that football and basketball bring a lot more benefits that are not covered by the scope of profit.
Someone asked the question "where would marquette be without basketball?" The answer is probably close to where Rockhurst is now. A small, urban, academically prestigious, Jesuit, liberal arts university that no one has ever heard of and is on the verge of bankruptcy and will probably be closed in the next 25 years.
I don't remember the exact numbers but if I remember correctly, after Marquette went to the final four in 2003, donations nearly quadrupled and applications increased by 13,000. Basketball, football, volleyball, soccer, hockey, baseball, and softball have this power. (Not at all schools but for many). Tennis, swimming, golf, etc do not
I agree with this post ... and I'm saying the same thing idea applies to non-revenue sports. They are not just viewed as a money suck on a University. As I have repeatedly said, Universities offer incentives to "desirable" students all the time (known as scholarships). non-revenue sport athletes are better students than the general population. This is why universities have these sports and offer scholarships in these areas.
So given your ROI definition, a lot of non-revenue sports may make the cut. As I said before, it is not a money issue, it is a priorities issue.
Quote from: TAMU Eagle on August 11, 2014, 10:57:43 AM
I don't think you see my point. If all that is true about Mississippi Valley State, then they should cut their basketball team. But they should cut their sand volleyball team first.(Assuming it has a lower roi)
If I could, I would cut every low roi program in the nation. It could potentially save higher education as we know it.
If you don't benefit the academic mission of the university, you don't deserve an academic scholarship imho. Marquette basketball does that, Marquette tennis does not.
I'm just curious how the Marquette tennis team does not benefit the academic mission. It MAY not benefit it, but I don't think you can categorically say it doesn't. Hell, someone can make the argument that some of these high profile programs have hurt the academic reputation (short term) of some schools due to academic scandals, etc. I don't disagree with your general premises, but seems to me you're making too black and white an argument on some of these.
Then we have opportunity costs. The men's basketball team likely serves the MU academic mission better than the tennis team...point taken to a degree. One could argue not having any basketball or athletic team and using those resources could push the mission even further ahead. In fact, there are a number of folks that have made that very pitch at MU and at other schools.
At the end of the day, it's not a pure ROI calculation, as I'm sure you know very well. Sometimes it's to say you got a big johnson, too, and want to play in the big leagues. There is a cost to doing that. Often it can be nothing more than that, just the cost of getting that "prestige". Definitely interesting perspectives, would love to have a beer about it some day in College Station! ;)
Quote from: Heisenberg on August 11, 2014, 01:50:34 PM
So everyone is in agreement that college football makes tons and tons of money and any stat to the otherwise is a enron-isk lie?
And the fact that Cal-Berkeley and Michigan are spending $550 million on two stadiums means nothing when calculating the profitability of football?
On this point, all I'm arguing is college football does not make as much as you think and the only way for you to make your point is reject data and "just announce" they do.
FYI you aren't using data either. You are using a factoid(with no verification) that an interested party used to form their side of the argument.
I've seen the books on several D1 Athletic departments that are not the top 25 programs. Depending on how you assign dollars and cents and quantify relatively intangible benefits to the school, you either got a lot of football/basketball programs that are profitable or only 20-25 that are. Neither scenario is factually inaccurate, however depending on your philosophical bent one has more relevance for the argument you are trying to make.
You aren't wrong, but that doesn't mean you are right either.
The O'Bannon Ruling and the Beginning of the End of NCAA Inc.
http://www.businessweek.com/articles/2014-08-11/inside-obannon-ruling-ncaa-inc-dot-business-model-starts-to-unravel?campaign_id=DN081114
It's not going to happen overnight, but the current structure of NCAA Inc.–the $16 billion-a-year college sports industry–will have to change. Old myths of amateurism and sport-as-hobby, which for generations have held the National Collegiate Athletic Association together, are crumbling under twin pressures: university sports factories demanding freedom to commercialize football and basketball as they see fit, and elite players demanding a slice of the revenue pie. The center cannot hold.
Last week the NCAA's Division I board gave the 65 schools with the richest sports programs greater freedom to increase financial benefits for top recruits and allow aspiring pro athletes to hire agents. Then a federal judge in Oakland struck down the NCAA's rule barring players from licensing their names and likenesses for commercial purposes. The future will bring more concessions to the mutinous power conferences and more player lawsuits. And don't forget the campaign to allow NCAA football players to unionize.
Given all the turmoil, it's worth taking a close look at the Aug. 8 ruling by U.S. District Judge Claudia Wilken in the antitrust case known as O'Bannon v. NCAA, a reference to former University of California at Los Angeles basketball star and lead plaintiff Ed O'Bannon. Wilken's ruling is far from the last word; the NCAA will appeal its defeat, and other cases are in the pipeline. Still, her 99-page disquisition constitutes the most probing judicial examination of the NCAA I've ever read. If higher courts embrace her findings, the revolution in the college sports industry will accelerate more rapidly than even the most ambitious advocates for change might had expected.
Story: Digging Into the Details of the NCAA's New Rules: Four Blunt Points
In a subsequent piece, I'll explain what she proposes to do about the NCAA's unlawful cartel-like conduct. For now I'll boil down Wilken's "findings of fact."
1. The marketplace. To find a violation of the Sherman Antitrust Act, a judge must define the relevant market in which trade is being unlawfully restrained. Wilken identified two such markets. In one, which already exists, universities compete for top athletes who are compensated with scholarships and other come-ons. In the other, which would exist in the absence of the NCAA's restrictions, television broadcasters and video game makers would compete for licenses sold by players for the use of the athletes' likenesses.
2. The cartel. Under Wilken's view of the marketplace, the NCAA is immediately in trouble. Its member schools explicitly collude to cap compensation in the competition for athletic talent, while they squelch altogether the market for student-athlete licenses. That's illegal unless the NCAA can come up with a "pro-competitive" justification for its conduct. Wilken knocked down each of the NCAA's purported justifications.
Story: The NCAA Needs Reform, but Paying Players Doesn't Cut It
3. Amateurism. The association claims that consumer demand for its product–football and basketball games–rests on fan preference for amateur competition. Wilken noted, though, that the very concept of amateurism is an NCAA confection and one that universities have defined inconsistently over the decades.
Early in the 20th century, NCAA rules barred athletic scholarships that today are seen as sacrosanct. So schools recruited students with flat-out "subsidies" and under-the-table payments. In 1948, the NCAA enacted a "Sanity Code" designed to eliminate the cash-in-envelopes for ringer football players. That code banned financial aid based on athletic skill, a prohibition that would, again, have ruled out present-day sports scholarships. The NCAA soon repealed the Sanity Code and created an enforcement committee to investigate rules infractions, the forerunner of the contemporary disciplinary apparatus that (absurdly) polices such sins as students selling jerseys or championship rings on EBay (EBay). In 1956, the NCAA reconceived amateurism as allowing athletic scholarships that included supplemental cash for incidentals like laundry and supplies. In 1975, it retracted permission for incidental cash but later allowed players to receive federal Pell grants, even if the latter exceed the cost of attending college. Other exceptions now allow, for example, NCAA tennis players to accept professional tournament prize money earned as teenagers.
In short, Wilken found that amateurism is whatever the NCAA says it is–a justification that's too convenient by half. Moreover, she poked large holes in consumer surveys upon which the NCAA relied to show that college sports fans want to watch only amateur competition. The surveys were distorted by leading questions and dubious interpretations of ambiguous results. The NCAA's own witnesses conceded that fans buy tickets based on alumni loyalty and regional attachments. An athletic department official from the University of Texas testified that UT sports would remain popular as long as they had "anything in our world to do with the University of Texas."
Quote from: ChicosBailBonds on August 11, 2014, 03:59:14 PM
I'm just curious how the Marquette tennis team does not benefit the academic mission. It MAY not benefit it, but I don't think you can categorically say it doesn't. Hell, someone can make the argument that some of these high profile programs have hurt the academic reputation (short term) of some schools due to academic scandals, etc. I don't disagree with your general premises, but seems to me you're making too black and white an argument on some of these.
Then we have opportunity costs. The men's basketball team likely serves the MU academic mission better than the tennis team...point taken to a degree. One could argue not having any basketball or athletic team and using those resources could push the mission even further ahead. In fact, there are a number of folks that have made that very pitch at MU and at other schools.
At the end of the day, it's not a pure ROI calculation, as I'm sure you know very well. Sometimes it's to say you got a big johnson, too, and want to play in the big leagues. There is a cost to doing that. Often it can be nothing more than that, just the cost of getting that "prestige". Definitely interesting perspectives, would love to have a beer about it some day in College Station! ;)
Oh absolutely. I agree with pretty much all of this. I have no data on the basketball team's ROI or the tennis team's or any other team's for that matter. That would take much smarter people than I to do a proper assessment. My hypothesis is that the ROI for certain sports will be a lot higher than it is for other sports. And there are other factors that need to be considered besides an ROI calculation. Again, it takes a lot smarter people than I. But in the current political landscape I think higher education as a whole (not just athletics) needs to be more focused on the ROI of their various programs.
And anytime you are in college station, give me a hollar. I'd be happy to buy a Californian gentleman such as yourself a nice cold shiner right in the middle of God's country.
Quote from: Heisenberg on August 11, 2014, 04:30:30 PM
The O'Bannon Ruling and the Beginning of the End of NCAA Inc.
In short, Wilken found that amateurism is whatever the NCAA says it is–a justification that's too convenient by half. Moreover, she poked large holes in consumer surveys upon which the NCAA relied to show that college sports fans want to watch only amateur competition. The surveys were distorted by leading questions and dubious interpretations of ambiguous results. The NCAA's own witnesses conceded that fans buy tickets based on alumni loyalty and regional attachments. An athletic department official from the University of Texas testified that UT sports would remain popular as long as they had "anything in our world to do with the University of Texas."
This last section though would argue that they are incredibly well compensated by their association with the university and loyal alumni.
That without this association, the individuals have no value. So they are not marketing their likeness, they are marketing quarterback X from the University of Texas.
Quote from: forgetful on August 11, 2014, 05:49:44 PM
This last section though would argue that they are incredibly well compensated by their association with the university and loyal alumni.
That without this association, the individuals have no value. So they are not marketing their likeness, they are marketing quarterback X from the University of Texas.
They are marketing their exact likeness.
If the NCAA is correct, why not just license a generic-faced QB with Texas gear since the athlete only has value through his association with Texas (which very few people believe, BTW)?
Quote from: Heisenberg on August 11, 2014, 11:26:05 AM
The purpose of a University is not to make money. We have a separate category of "for-profit schools" ... none of which are NCAA members.
Not that it really adds to the discussion (which I'm finding very enlightening), but just because I'm a stickler...Grand Canyon University.
Quote from: source? on August 11, 2014, 10:48:14 PM
Not that it really adds to the discussion (which I'm finding very enlightening), but just because I'm a stickler...Grand Canyon University.
Are they a NCAA member?
Quote from: Heisenberg on August 12, 2014, 06:34:20 AM
Are they a NCAA member?
This is a fairly recent development. I want to say within the last two years or so.
So we have at least one for profit school ... and they offer more college sports than MU
http://www.gculopes.com/sports/2010/1/19/GEN_0119104423.aspx?id=3
The Grand Canyon University Department of Intercollegiate Athletics is dedicated to providing quality programs and athletic experiences for men and women with interest and ability that is consistent with the stated mission and values of the university.
We are committed to the development of the whole person. The department strives to educate and involve students and the university community in the promotion of personal growth. This department strives to prepare men and women to be student-athletes distinguished by integrity, effort to succeed, and Christian conduct.
We expect our student-athletes to pursue excellence on the courts and playing fields, in the classroom, and in our community. Students who choose to participate in our athletic programs are challenged to lead lives committed to health, discipline, perseverance, and stewardship. We expect our student-athletes, coaches and staff to emulate Christ in all aspects of their lives including their academic and athletic endeavors.
--------------------
Maybe if MU did the ROI calculation TAMU wants they will conclude MU need MORE sports?
GCU advertises here in So. Cal like nobody's business. They have quite the operation going on.
Higher education institutions across the nation are watching Grand Canyon very closely. They are almost like a hybrid of traditional four year bachelor's granting institutions and the crazy cheap but significantly sketchy online universities such as university of Phoenix. They may be destined for failure, they may be the future of higher education, or they could be the thing that complete undermines years of tradition. I think most traditional universities are hoping that they fail.
Quote from: WarriorInDC on August 11, 2014, 01:48:02 PM
Not really sure what the bolded part above has to do with this. That would only affect year-over-year profitability within the same program. The allocations portion makes a ton of sense, but the Big House a football only resource so the amortization schedule would only affect expenses for football timing wise. Accruals would only have a timing effect as well.
Put the Big House renovation on a five-year amortization and watch what happens to the financial statement profitability of Michigan football!
On an economic -- or cash flow -- basis, you're right, it does not matter. But GAAP, as I am sure you know, doesn't work that way. A 40 year amortization has a very modest impact on year-over-year profitability. A five year amortization would kill it!
Quote from: TAMU Eagle on August 12, 2014, 12:59:40 PM
Higher education institutions across the nation are watching Grand Canyon very closely. They are almost like a hybrid of traditional four year bachelor's granting institutions and the crazy cheap but significantly sketchy online universities such as university of Phoenix. They may be destined for failure, they may be the future of higher education, or they could be the thing that complete undermines years of tradition. I think most traditional universities are hoping that they fail.
Many higher education institutions are already adopting aspects like this. ASU has an online only program, Central Michigan, Penn State, University of Florida all have online only bachelor degrees.
We will see more universities progress towards this type of model. I think it greatly undermines the quality of the education. There are already people that make a small fortune taking courses for people to get them a degree without any actual effort.
But with the value of a Bachelor's degree declining it is not possible to maintain the current model either.
Quote from: dgies9156 on August 12, 2014, 01:03:20 PM
Put the Big House renovation on a five-year amortization and watch what happens to the financial statement profitability of Michigan football!
On an economic -- or cash flow -- basis, you're right, it does not matter. But GAAP, as I am sure you know, doesn't work that way. A 40 year amortization has a very modest impact on year-over-year profitability. A five year amortization would kill it!
Yes I get that. But it seemed like most of the discussion here around the tricky accounting sports departments are doing are shifting costs/revenues from one sport to the other, handling costs/revenues of merchandising, handling donations, etc. All items that change the profitability of individual sports within the same year.
Changing the amortization schedule affects the profitability of Michigan football-only and only affects it YOY.
Quote from: TAMU Eagle on August 12, 2014, 12:59:40 PM
Higher education institutions across the nation are watching Grand Canyon very closely. They are almost like a hybrid of traditional four year bachelor's granting institutions and the crazy cheap but significantly sketchy online universities such as university of Phoenix. They may be destined for failure, they may be the future of higher education, or they could be the thing that complete undermines years of tradition. I think most traditional universities are hoping that they fail.
TAMU, I have worked with many guys in the IT industry who got their degrees at U of Phoenix. All very smart guys. Of course I don't know if that was due to U of P or not or if they were already talented guys in the field that just needed the degree to move up the ladder.
Quote from: brandx on August 12, 2014, 07:55:19 PM
TAMU, I have worked with many guys in the IT industry who got their degrees at U of Phoenix. All very smart guys. Of course I don't know if that was due to U of P or not or if they were already talented guys in the field that just needed the degree to move up the ladder.
Oh absolutely. Online education is a great tool when used for the proper need. The problem comes when University of Phoenix (and others) try to market themselves as being able to confer the same quality of education as a four year brick and mortar university. U of P is actually in the middle of a lawsuit right now where a group of former alumni are suing them for fraud and false advertising.
Quote from: brandx on August 12, 2014, 07:55:19 PM
TAMU, I have worked with many guys in the IT industry who got their degrees at U of Phoenix. All very smart guys. Of course I don't know if that was due to U of P or not or if they were already talented guys in the field that just needed the degree to move up the ladder.
x
smart guys who needed a credential. Their Phoenix 'education' did nothing for their skill or knowledge store.