Most college football anyone will talk about is sanctioned, ruled, and run by the NCAA. The NCAA makes all rules and regulations for the sports it overlooks, anywhere from water polo to football. The NCAA covers a majority of schools in the states. There are very few schools with sports that are not under NCAA rules; these schools are under the NAIA. With the NCAA having rule over hundreds of schools, they tend to make a healthy profit each year. They are a billion-dollar business, literally. “The collegiate athletic group earned nearly $1.1 billion in 2017”(Garcia). Most of this comes from television deals and the rest is merchandise, tournaments, and championships. Other than March Madness there isn’t very much that people will watch other than football. These television deals are not just for a month of basketball, they’re for four months of football. Not only does the NCAA make a lot of money, but the teams themselves also make a generous revenue, as well as some, being worth hundreds of millions of dollars. The football teams themselves make tens of millions of dollars, one (Texas) even making over $100 million. These teams that make all this money also spend a lot of that money and they spend it on a lot of different things.
The NCAA reported that television and marketing rights fees accounted for over $840 million of the $1.06 billion in the 2018-2019 sports year. The NCAA just renewed a deal that is worth $8.8 billion through 2032 with CBS and Turner. These big companies are not just signing these deals for a month of college basketball, they are doing it for the span of college football, from late August to early January. These four and a half months draw in millions upon millions of viewers, especially towards the end of the season. “The six College Football Playoff (CFP) games, all telecast on ESPN, produced five of the six most-watched cable presentations of the year.”(National Football Foundation). The only other higher watched telecast being the Superbowl. This displays the sheer dominance of football and more specifically, college football. The NFL could not beat any of those playoff games with its playoffs, neither the AFC nor NFC championship. College football is why those companies spend so much to be able to broadcast those games for other companies to want to advertise. They would be willing to pay enormous amounts of money for such a small slot of time. “Commercial time for 30-second spots in each of the semifinal games have cost advertisers about $750,000 a pop, with spots in the Jan. 8 national championship game going for about $1.2 million per unit”(Consoli). College football makes the NCAA hundreds of millions of dollars each year and it is not even really because of football, it is because advertisers know that millions upon millions of people will be watching a certain event at a certain time.
The teams themselves make a pretty penny and are worth even more. Data from Examining the Value of Sport Clubs: A cross-sectional Intrinsic Valuation of NCAA Football Bowl Subdivision (FBS) Football Programs show that the University of Texas football program is worth almost $380 million and the top 14 teams are all worth at least $100 million and all of the top 25 are worth more than $60 million; these schools football teams are worth the same as very successful businesses. The top five profits from the 2017-2018 season all top $60 million dollars in profit, not just revenue. Texas was the country’s leading profiter, making over $100 million. This is done while some teams cannot even break even with expenses. Some teams have to be supported by other sports and prayers of donations. Texas is able to do it with no sweat and even with not being nearly as successful as they usually are. Finishing 6-6 in the regular season, going .500, for a program like Texas, that is embarrassing. Even though they were underperforming on the field, they made about $42 million on ticket sales which is $5 million more than the previous season, and ticket prices had remained the same. “The Longhorns generated $42.4 million in football ticket revenue during the 2016 season, Charlie Strong’s last at UT. That’s a jump from $37.4 million generated during the 2015 season”(Davis). They went 5-7 in the regular season; being one game worse is hardly a difference in college football especially losing five games by seven points or less in the 2016 season and four games by five points or less in the 2017 season. Texas may have had a better record in the 2017 season but that hardly reflects on the talent and how good the team was. These two teams were more or less just as good as each other and they still have a $5 million increase in ticket sales. Texas is also making its money off of royalty payments, they made an additional $32 million. They make tens of millions of dollars a year based on people buying any Texas football merchandise that is licensed. That means most websites and stores that sell apparel (not counting sites and stores that pirate and make their own merchandise and sell it without a license) give a portion of their profits back to the Texas football program. They made $18.4 million in media rights. They were paid by the Big IIX conference just to televise their games, win or lose; if they show up and play they get their money (Daniel). People are not watching Texas because they are good, people are watching Texas because they are Texas.
It’s not necessarily the best teams that are making the most, it's the teams everyone knows. Another example is Clemson, they made a measly $5.7 million despite going to consecutive national title games and winning one. Notre Dame is like Texas, people will watch them for who they are and not what they are. They haven’t won a major bowl game (Peach, Sugar, Fiesta, Cotton, Rose, or Orange) since 1994. They have been to one national title game and were crushed by Alabama. Alabama has won 5 national championships in the last ten years. Despite being the best college football team of the 2010’s they only made $48.2 million and are only the fourth highest profiting program in the country. Another surprise is Texas A&M. They have not had any national prevalence other than being ranked in the top 25 once or twice. As well as winning one of the six major bowl games in the last 20 years. Despite this they still made the most revenue in the SEC (southeastern conference) in the 2017-2018 season, making only $3 million less than UT (Dosh). However, being around since 1894, being one of the oldest college football programs, playing in the most talented and best-known conference, and playing in the state of Texas will certainly attract a healthy number of fans.
However these programs are spending a lot, some outspending what they bring in. Texas football had a revenue of about $143 million and spent $42 million of that. What they spent it on ranges to a multitude of things. They spend money on recruiting, athletic student aid, coaching salaries, recruiting, facilities and equipment, travel, and other expenses. According to the Texas Tribune, in 2015-2016 the university of Texas made a revenue of $127,876,986 and had spent a total of $28,672,761. Texas spending almost $29 million on just their football program might raise some questions on what exactly a college football program is spending all that money on. As reported by Business of College Sports in the 2012-2013 season, the University of Texas made a revenue of about $109 million and spent around $27 million, turning a profit of close to $82 million. Texas spending most of their money on coaches’ salaries and support staff, game expenses, student aid, travel expenses, support for spirit groups like cheerleaders and dancers, camps, facilities, and other payments make up a majority of the expenses. The leading expenses for the program are the salaries of the coaches and support staff like equipment managers and such, this amounted to nearly 50% of all of the expenses. Then comes student aid and game expenses both amount to 15% each, travel expenses and support for spirit groups both come to about 5%, everything else, even recruiting fell under the last 10% of what they spent during the 2012-2013 season. Since then the expense to recruit has jumped to $1.8 million in the 2018-2019 season reported by 247 sports, with that so has their total expenses, revenue, and profit.
College football is a business; it is treated and run like a business. The NCAA makes its money from the teams and the team makes its money from the fans. The teams aren’t afraid to spend money either, some spend a fifth of what they make, some spend more than they make. People will watch a game for the teams that are playing, it doesn’t matter if they are any good. Many people think that college football is just a bunch of guys running at each other; however, it is an intricate business run by serious professionals. Despite the misconceptions of the simplicity of the sport, people quite literally live off of college football. College football is a business and it should be treated as such.
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