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The Business of College Football - Picking the Team

posted by Jeff Yastine, Senior Correspondent at 2:05 PM on 11/09/07

Photo of Jeff YastineThe hardest part of doing an in-depth series is figuring out where to focus your stories. And that was definitely the case once I started working NBR’s “The Business of College Football” series, which premieres Monday, November 12th. We could have approached a major known football power, like the University of Florida or Ohio State (two of the most profitable football programs in the country), but we felt that much of their "stories" was already known. We decided to look for a school that is in what you might call the "2nd tier" of football schools, but looking to break into the "1st tier." We settled on Texas Tech University (TTU). It's the focus of the first of our 4 stories.

Texas Tech administrators make no bones about why they have a football program. Their aim over the past decade has been to spend what it takes to win, to go to post-season bowl games, and to put the school on the national map. Why is that so important? Because it gets the school national media exposure. That’s something Texas Tech is eager to have. The university is based in Lubbock, in the sparsely-settled western end of the state, far from a major metro center like Dallas or Houston. It is competing for media attention with other Texas football power houses, like the University of Texas and Texas A&M.

Winning football programs also generate larger and more frequent donations from alumni and other private donors, not to mention the ticket revenues that result from a stadium packed with excited fans. So, while universities are supposed to be "non profit entities," they do operate with an eye toward the bottom line. Texas Tech is no different. Profits from the football program help support other less-popular sports -- what sports-business analysts call "non-revenue generating sports," like golf or track-and-field.

Five years ago, TTU drastically expanded its football stadium, adding thousands of extra seats and dozens of luxury skyboxes. Stadiums are major assets and revenue-generators for schools. Of course, once you build a stadium, you have to keep generating more money to pay for the upkeep and debt-service on the construction bonds. TTU officials were more than happy to explain their strategies, and how they intend to continue to expand the business role that football serves for the school.

In my next blog entry, I'll talk about how a football program can change a small school, which is the focus of the second part of my series. Join me for a trip to Seton Hill University in Western Pennsylvania Tuesday night. Stay tuned.

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Jeff, first my thanks to Jaime George for posting the transcript for the last program in the series. You concluded the program by saying: "It`s supposed to be an amateur`s game and at most smaller schools around the country, it still feels that way. But add in the big stadiums, multimillion dollar television contracts and corporate sky boxes, and it takes on all the trappings and money of a professional contest. And that is the paradox of college football, maintaining an uneasy coexistence among educating athletes, enriching universities and entertaining fans."

An uneasy coexistance does not quite capture what's going on. Let me explain.

You rightly said that the issue of coaches` salaries raises a broader question about the nature of college football, asking: "How much is too much to pay for a winning program? And has an arms race mentality taken hold, where winning and the money is generates trumps everything else that college football is supposed to be about?
In this context, NCAA President Myles Brand disputed Knight Commission Co-chair William Kirwan's view that the increase in private giving to intercollegiate athletics at America's universities is troubling to the extent that he has become quite alarmed by what he calls a distortion in values. As you reported, Brand said: "Universities and their football programs fill multiple roles."

More specifically, Brand said: "Some so-called reformists would like to see intercollegiate athletics removed from the campus entirely -- either professionalize it or treat it as if - treat these large institutions as if they`re small league liberal arts colleges. They`re not. They have many missions, including missions of providing types of education that go beyond the classroom. They have missions about producing commercial activity in their communities."

Brand's remarks should come as no surprise. College sports are big business, and the NCAA is in the business of staying in business as the franchiser of professional-caliber, big-time college-sports programs for its member school franchisees. The NCAA is certainly not in the business of reform. The NCAA makes huge amounts of tax-exempt money under the guise of an institution of higher education. In effect, the government-subsidized NCAA manages minor league teams for the NFL and the NBA – supplying a stream of professional-level athletes for their respective drafts.

The NCAA's strategy to stay in business is to maintain the illusion that it is an institution of higher education, that college athletes are really students on a legitimate degree-seeking track, and that it is capable of instituting requisite reforms without government intervention and a consequent loss of its tax-exempt status. Hiring Brand was a key tactic. The former university president provides the NCAA with an academic front at a cost -- a total annual compensation package in the order of $1 million.

Here are some relevant comments:

1. Intercollegiate athletics is already professionalzed. Michigan State University College of Law Professors Robert and Amy McCormick argue in a Washington Law Review article that grant-in-aid athletes in revenue-generating sports at NCAA Division I institutions should not be viewed as "student-athletes" as the NCAA asserts, but should, instead, be considered "employees" under the National Labor Relations Act.

2. In many, if not most, instances, college athletes’ participate in an alternative educational experience that is not part of the school’s serious academic life, but rather a customized pseudo-academic experience engineered by academic support center staff members who work at the behest of the school’s athletic department to maintain the eligibility of the school’s athletes.


3. Reformists would not like to see inter-collegiate athletics removed from the campus, rather they would like to see independent oversight of the NCAA's overly commercialized college sports entertainment business. With the co-option of the Knight Commission by the NCAA, there is no one outside the government charged with anything resembling responsibility for controlling this business that has become expert at resisting true reform.

4. The business has exploited college athletes, provided weak rules enforcement, shown a lack of concern with regard to violence by college athletes and the connection of violence to the use of performance enhancing drugs, while limiting access to higher education by real students and shrouding its conduct in a veil of secrecy – taking inappropriate, if not illegitimate, refuge in the privacy provisions of the Buckley Amendment to the Family Educational Rights and Privacy Act (FERPA).


5. America's future position as a global economic and academic leader is compromised by its obsessive sport's culture. This cultural problem not only distracts the attention of college and university officials from the burning issues of our time, but also lies at the root of the decline toward the total prostitution of their colleges and universities in a seeming desperate quest for more money, power, and prestige.

6. Unbounded hypocrisy undermines these officials as they are apparently either unwilling or unable to work seriously to restore academic primacy and integrity to their institutions and to the whole of higher education -- that is, with the rare exception of John V. Lombardi, the recently appointed president of the Louisiana State University System, who frankly said how it is:

“Mega college athletics is indeed a remarkable American invention, it reflects the decisions of academic administrators and governing boards at almost all colleges and universities for over a century. It prospers because for the most part we (our faculty, our staff, our alumni, our legislators, our trustees, our students, and our many other constituencies) want it. We could easily change it, IF MOST OF US WANTED TO CHANGE IT. All protestations to the contrary, we, the colleges and universities of America and our friends and supporters, do not want to change it. What we really want is to imitate the best (often the most expensive) programs in America by winning games and championships.”

8. The last thing the NCAA, the Knight Commission, and school officials, want to hear about is a congressional hearing on transparency and accountability aimed at making the college sports business prove that it deserves its tax exempt status because such a hearing would likely expose institutional misbehavior via disclosure of the grades of athletes, the courses they take, and the faculty who teach the courses. It is this institutional misbehavior that enables the NCAA to continue its ‘student-athlete’ ruse – a fraud perpetrated on American taxpayers.

9. Without federal intervention, the mess in big-time college sports will only grow worse as the schools adopt counter measures to foil or circumvent the NCAA’s pathetically weak reform and enforcement measures and as the Knight Commission continues to work with the NCAA – providing it with cover while both the Commission and the NCAA dance far from the edges of serious reform.

Frank G. Splitt, Member
The Drake Group
http://thedrakegroup.org/
Former McCormick Faculty Fellow
McCormick School of Engineering and Applied Science
Northwestern University

Mr. Splitt - Thanks for your interest in the series. The transcript to the fourth part of the series is currently available in our "regular" transcript archive, which can be accessed via the ON AIR button on our NBR menu bar.

However, as you noticed, I have not yet posted the link on the web page that is dedicated to the series because I am still preparing the video clip. I will add the transcript link and the video link to the page shortly.

By the way, here's the direct link to the transcript, in case you'd rather not explore our transcript archive or wait until I add the link on the special's home page... Transcript: The Business of College Football - Part 4

Jeff, your PBS Nightly Business Report's 4-part series, "The Business of College Football," concluded last night with a program titled "The Cost Penalty" that asked a contentious question: Should college football coaches be paid more than professors?.

The home page for the series has featured transcripts for the first three parts. Noticeably absent has been the transcript for the concluding part that contained statements by NCAA President Myles Brand that went unchallenged -- giving viewers the impression that his statements were beyond challenge.

In view of my yesterday's comment, I suspect that the Senate Finance Committee, among others, would be quite interested in exactly what President Brand had to say.

I look forward to seeing the posted transcript
for Part 4.

Also, in the interest of providing a balanced perspective, I suggest that The Drake Group Website, http:thedrakegroup.org, be added to the listof external links.

Frank G. Splitt, Member
The Drake Group
Former McCormick Faculty Fellow
McCormick School of Engineering and Applied Science
Northwestern University

Jeff,the business of college football is under congressional scrutiny. Briefly, here's the story:

On Oct. 2, 2006, former Rep. Bill Thomas (R-CA), the past Chairman of the House Committee on Ways & Means, initiated inquiries into the tax-exempt business of college sports by sending NCAA President Myles Brand a sharply-worded letter – asking why the NCAA and its member institutions should maintain the tax-exempt status of their sports programs. The Thomas letter triggered a powerful issue-amplifying column by nationally syndicated columnist George Will as well as a host of supporting editorials and columns in the national media that continue to this day.

Senator Chuck Grassley (R-IA), the former Chairman of the Senate Finance Committee and now its Ranking Minority Member, has taken up the cause The primary aim of his effort is to have taxpayer subsidies for college athletics programs benefit the public at large. A spinoff benefit would be to obtain a significant increase in the level of transparency and accountability at the NCAA.-- helping to minimize academic corruption that enables institutions of higher education to field competitive teams so that they can garner financial, PR, and other rewards associated with college sports.

Unfortunately, your four-part PBS Nightly Business Report (NBR) on "The 'business' of college football," appears to be a puff piece on the upside benefits associated with college football -- overlooking significant downside problems. Alhough the concept for the football series is attributed to NBR's sometimes field producer Kira Rockell, it nevertheless has all the hallmarks of an NCAA promotion piece facilitated by the NCAA co-opted Knight Commission. Its emphasis on benefits comes across as a response to congressional scrutiny of the NCAA and the numerous articles in the national media that suggest that now is the time for the Congress to do something about the hypocrisy and pervasive fraud in big-time college sports that tends to warp the academic mission of America's colleges and universities.

For more on congressional scrutiny of the NCAA, see "Reclaiming Academic Primacy in Higher Education: The Revised IRS Form 990 Can Accelerate the Process,"
http://www.thedrakegroup.org/Splitt_Reclaiming_Academic_Primacy_IRS.pdf

The series has aleady been suggested for consideration as a great subject for critcal classroom analysis within the University of New Haven's Management of Sports Industries Program as well as by the New America Foundation and the University of Memphis College Sport Research Institute.

Frank G. Splitt, Member

The Drake Group
Former McCormick Faculty Fellow
McCormick School of Engineering and Applied Science
Northwestern University

Jeff, this message precedes the transmission of a revised version of my comment that was posted yesterday. Posting of the revised comment will provide your viewers with a bit more detail on how the Congress got involved with the business of college sports last year.

Frank G. Splitt, Member
The Drake Group
Former McCormick Faculty Fellow
McCormick School of Engineering and Applied Science
Northwestern University

The business of college football in under congressional scrutiny. Briefly, here's the story:

Ranking Minority Member Senator Chuck Grassley (R-IA) has been working to determine the justification for the NCAA's tax-exempt status. The primary aim of his effort is to have taxpayer subsidies for college athletics programs benefit the public at large. A spinoff benefit would be to obtain a significant increase in the level of transparency and accountability at the NCAA.-- helping to minimize academic corruption that enables institutions of higher education to field competitive teams so that they can garner financial, PR, and other rewards associated with winning.

The four-part PBS Nightly Business Report (NBR) on "The 'business' of college football," appears to be a puff piece on the financial, PR, and other benefits associated with college football. Alhough the concept for the football series is attributed to NBR's sometimes field producer Kira Rockell, it nevertheless has all the hallmarks of an NCAA promotion piece facilitated by the NCAA co-opted Knight Commission. Its emphasis on benefits comes accross as a response to congressional scrutiny of the NCAA.and articles in the national media that suggest that now is the time for the Congress to do something about the hypocrisy and pervasive fraud in big-time college sports.

For more on congressional scrutiny of the NCAA, see "Reclaiming Academic Primacy in Higher Education: The Revised IRS Form 990 Can Accelerate the Process,"
http://www.thedrakegroup.org/Splitt_Reclaiming_Academic_Primacy_IRS.pdf

The series has aleady been suggested as a great subject for critcal classroom analysis within the University of New Haven's Management of Sports Industries Program as well as by the New America Foundation and the University of Memphis College Sport Research Institute.

Jeff,

I look forward to your series this week. Your topic underscores one of the most interesting theoretical questions surrounding college sport: "What is the dominant institutional logic that underscores the business of college sport?" Intercollegiate athletics (college sport) is most often represented as an integral component of universities' educational missions. However, much independent college-sport research demonstrates that a commercial logic - that in many ways is inconsistent with an "educational" logic has come to dominate college sport.

Your initial report anecdotally supports much research on college, including recent research on the men's Division I Men's Basketball tournament revealed less than 8 seconds of educational messages conveyed in an tournament game; however over 49 minutes of commercial messages were conveyed.

The consequences of the dominance of a commercial logic and the inherent conflicts between the underlying values of educational and commercial logics may be the root cause of the many issues surrounding big-time college sport.

Such a theoretical perspective may be useful in informing future investigations into the "business of college sport" and the issues such a focus on college sport as a revenue stream has on education.

Not to sound self-serving, but such research is being conducted by entities such as the College Sport Research Institute at The University of Memphis. CSRI seeks to conduct and support independent critical college-sport research and explore these issues that have profound real-world educational and commercial implications for higher education in the United States.

Thanks,

Richard M. Southall
Director
College Sport Research Institute

Jeff:

How could you NOT choose Ohio State?

This school spends more than $108 million a year on athletics. They allocate hours of use for various departments to use private jets!

I'm a Florida alum, too, but I'd like to see OSU get some analysis...........

AND: I'm looking forward to the program.

Steven Swann
Stuart, FL

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