Albeit a bit dry, this extremely well-researched book is an eye-opening examination of the economics and politics surrounding the industry of college football.
Author, Gilbert Gaul breaks down each aspect of the business end of the game that has contributed to what college football is, today.
Gaul has done his homework. He spent countless hours speaking to the people who are IN THE KNOW about the inner workings of this sport, as well as college football’s relationship with other NCAA varsity sports. Gaul looked and spoke with representatives from various schools and organizations across the country, but he stayed focused on the 5 “power conferences” in Division-I football – SEC, ACC, Big Ten, Big 12, PAC-12.
As I said, Gaul’s focus was on the power conferences. In turn, he looked at the biggest football programs in the nation – Texas, Penn State, Georgia, Alabama, Notre Dame, Boise State, Michigan, etc.
More than a decade ago, America’s largest and most prestigious universities were already spending ten times more on football players than on their smartest, most ambitious students. Penn State, for example, game $2,250 scholarships to the students in its Honors College. By comparison, a football player on a full scholarship received $25,000 in aid, and this gap has only widened. Today, a football scholarship costs about $50,000, while an Honors College Scholarship is $4,500.
At this point, and for the rest of the book, I kept thinking, “Why are we putting so much emphasis on education and academics at the elementary and secondary level?” Twenty plus years ago, the trend was to teach “Whole Language” (as opposed to phonics), then we went to “No Child Left Behind,” and now, Common Core. After reading this book, I have to wonder why we even bother.
A “new” financial model for college football shows that the largest and richest programs pocket about $2.5 billion from television broadcasts, luxury suite rentals, seat donations, and corporate advertising, while others scrap by to make ends meet.
The flood of cash – nearly all tax free, thanks to the extraordinary generosity of senators and congressman from football-mad states – had also fundamentally altered the core mission of these schools. Now, instead of touting their educational offerings, they now promoted their football programs because football was exciting and attracted media attention.
To justify “football” spending, the presidents of these fine, upstanding universities developed a business model to turn their athletic departments into separate businesses and their athletic director’s to fund for themselves. In other words, athletic departments, and more specifically, football teams, would have to pay their own way. Be careful what you wish for!
So, like professional sports, it is now tough for a regular person to afford to attend a ballgame because one of the ways these schools make money is by asking their fans to pay a “Voluntary Seat Donation” to secure premium seating. At Texas, to get four seats on the 50-yard line, you will pay approximately $20,000. At Georgia, you will pay a seat fee at [a minimum] of $250 for a not-so-great seat.
Television has also played an increasingly important role. In the late 70’s, the IRS decided that college football powers should not have to pay taxes on the broadcast fees from networks. Their logic was that watching a game on TV was the same as watching it in person. The IRS didn’t tax the games, themselves, so why tax the broadcast(s)? However, the NCAA limited the number of times a school could appear on TV. Interestingly enough, in 1984, the Supreme Court decided that the NCAA limits violated antitrust provisions freeing the major football conferences to start to negotiate with TV networks on behalf of member schools. In 2013, the Big 12 passed along $21 million to Texas, with most of that coming from television fees.
Football powers also collected millions in royalties and licensing fees whenever their logos were printed on items. Millions more poured in from corporate advertising.
As of 2012, the most profitable college football teams were (in order): Texas, Michigan, Auburn, Alabama, Georgia, Florida, Penn State, Notre Dame, LSU, and Arkansas.
Texas has a motto: “We eat what we kill.” It means that Texas spends every penny it takes in from football and other sports. If that means spending $200,000 or more on its football players (yes, you read that right) to keep them happy and fit, so be it.
Football also [often] pays for non-revenue sports such as track & field, field hockey, women’s rowing, etc.
The costs associated with administrative overhead at these universities are astronomical!!!!!
The comparison and analysis between large and small schools, in regards to the number of varsity sports offered, as well as the number of athletes participating was intriguing. Some schools, like Texas, are very focused on what sports programs they offer, while others, such as tiny Haverford College, offer more opportunities for athletes interested in playing sports at the college level. Schools in the Ivy League have a motto – “Education through athletics.” They believe that if you think you can play a varsity sport, they want to give you that opportunity.
Now, think about what I’ve already written. Athletics and Academics are considered separate entities within a university, and are therefore, receiving separate funding. Next, I read that “football is an important part of Penn State’s educational missions, and as such, it is considered a charitable activity, and is protected from paying taxes.” Who makes up this BS?
To be fair, the IRS tried to tax (in this case) football seat donations in the mid-80’s, but was blocked by CONGRESS! Congress passed legislation in 1988 allowing college football fans to deduct 80% of the cost of their “donations.” FYI: That works out to approx. $250 million annually in lost taxes, or $2.5 billion over 10 years, according to the US Treasury Dept. estimates!
Where revenues go was riveting. For people who think they’re helping a student go to school? Probably not. Most of the top football schools spend 10% or less on scholarships. No, most of your “donation” is allocated to salaries, debt, and that infamous administrative overhead.
The analysis for the rationale of hiring head coaches and paying them obscene amounts of $$$$ was mind-blowing! We now have overinflated egos who are paid overinflated salaries, and for what? Don’t get me wrong. I like college football, but I think our priorities are skewered. No wonder college athletes think they should be paid!
One interesting comparison: the CEO of the American Red Cross, Gail J. McGovern, is paid $500,000 to oversee a $3.2 billion organization. Nick Saban (Alabama) is paid $6.5 million to run an $82 million football business. Ask yourself whether coaching college football is really that much harder than running a huge complex charity that supplies half of the nation’s blood and responds to hurricanes, fires, and other disasters.
The discussion regarding the University of Akron and their football program was most interesting, as I live and work close to Akron. Further reading about Larry Kehres and his role at Division-III, University of Mount Union, was inspiring and the most positive story to come out of this book!
The chapter dealing with “Walkers” and their responsibilities was absorbing, but not surprising. While the rest of the student body is expected to assume some responsibility and show up for class on their own, football players are treated like they are in elementary school.
I learned more about Title IX than I ever thought I needed / wanted to know. Women’s Rowing? Really?
The debt that universities are willing to go into to fund state of the art educational / tutoring facilities for their “student athletes” (and I use this term, loosely) is
mind-boggling. These kids are here to play football. Why waste money on a super nice learning facility that they are not going to appreciate?
While we love football in Ohio, we have NOTHING on football in the South! “It’s almost a Civil War mentality – civic pride.”
“Media Days” was educational. One kid, Griffin Hamstead, age 15, was there promoting his product. He’s the author of a blog called “Teens for Tennessee,” which showcases opinion, statistics, and random musings on the University of Tennessee football team.
The section dealing with “The Color of Money,” and more specifically licensing of merchandise in regards to items “tied” to the University of Alabama was captivating, and a little freaky. It also made me think a lot about questions that I and fellow Ohio alumni have about Ohio State University and the use of our logo (as ruled in a court of law) and what type of royalties our school (Ohio) might be receiving.
Every few years, college presidents do realize that they have created a monster, and in turn, conduct a study for how to fix things in the world of college football. They realize they need to be disciplinarian, but nobody is brave enough to take the first step off that platform, so they shelve the study, and a few years later, the process starts all over again. However, towards the end of this book, one university president / chancellor makes a different suggestion. Whether the idea will ever take root is anyone’s guess.
In the end, there are over 100 Division-I schools. The 5 power conferences, mentioned earlier, consider themselves the elite of the elite, and have positioned themselves to try and block any interloper(s) from invading their sacred space. Case in point: Boise State.
Gaul: The notational idea that college football is still a game, as opposed to an elaborately rich entertainment is rapidly receding from the American landscape of sports.
In July of 2014, Senator Jay Rockefeller (WV) held a hearing. During this time, he said, “Playing college sports is supposed to be an avocation. There’s a growing perception that college athletics, particularly Division-I football and basketball, are not avocations at all. What they really are is highly profitable enterprises. This country is now so soaked in the culture of ESPN, … it’s undermining our values. I’ll tell you one thing for sure: I think it’s undermining our commitment to education.” Ding, Ding, Ding! Bingo! I doubt anything will ever change, but at least one senator gets it!
Finally, I disagree with the idea that college athletes should be paid. They receive a lot of benefits that the average student can only dream about. They have no idea how the other 99% + (Ohio State has 0.02% of their undergraduates participating in sports) of their classmates live.
At the end, Gaul provides a great theory that could prove right for the future. It will be interesting to see what path college football takes.