Tag / NCAA

by Hoosier Econ

NCAA & TV Ad Revenue from March Madness

march madness

The NCAA Basketball Tournament kicks off in a few days. As America tunes in to watch the games the NCAA will watch their bank coffers fill up. How much does the NCAA make each year during tournament time. According to Andrew Zimbalist, an economics professor at Smith College, hundreds of millions:

    “The institution itself that’s based in Indianapolis, makes money primarily through television rights to the March Madness basketball tournament. They get somewhere in the neighborhood of $770 million dollars a year. That constitutes around 90% of all of the revenue that goes to the NCAA,”


Television stations are more then willing to pay that type of money to the NCAA for rights to air the games. Here is their ad revenue from 2013:

    Over the past decade (2004-2013), the NCAA men’s basketball tournament has triggered more than $6.88 billion of national TV ad spending from 269 different marketers. Ad revenue in 2013 was $1.15 billion, up 3.8 percent from the prior year.

Advertisement
by Hoosier Econ

How Much Money Goes Into March Madness Bracket Pools?

march madness
Tis the season where millions of Americans take a gamble in starting to fill out their NCAA tournament brackets. Men and women will take out their wallets and throw down some money to enter in a pool with other in the hope they make some easy money in applying their college basketball knowledge. How much money do Americans spend during this time of year? It’s very hard to estimate since 90% of all NCAA tournament gambling is off the books. But lets take a look at some history to guage this sports investing event.

In 1999 there was a report issued by then President Bill Clinton:

National Gambling Impact Study Commission, formed by President Clinton, released a 1999 report citing surveys showing that well over 90 percent of all sports betting nationwide takes place off the books. If accurate, that would push the total wagered on the NCAAs across the country closer to $1 billion.

Fast forward to 2014 where more data can be evaluated yet is still a rough estimate, one sports investing website gave this estimate:

The site Pregame.com estimates that wagering on this year’s March Madness tournament will exceed $12 billion, more money than was riding on the Super Bowl. Of that, $3 billion will be put into office pools of tournament brackets.

Comparing those two estimates, NCAA Tournament betting has exploded 1100% in America. Good luck with your tournament pools this year.

H/T The Fiscal Times and BetFirm.com

by Hoosier Econ

Vegas Sets 2014 Sports Gambling Records

The numbers are in and sports investing broke records in 2014 for betting revenue. ESPN supplied the breakdown:

The state’s 187 sportsbooks won $227.04 million off of the $3.9 billion wagered on sports in 2014. Both amounts are all-time records, according to Nevada Gaming Control.

Football, per usual, carried the load. The sportsbooks won $113.73 million on college and pro football in 2014, a giant 40.73 percent increase from 2013. Overall, $1.74 billion was bet on football in 2014, $12 million more than in 2013. Nevada Gaming Control does not track pro and college football separately, but sportsbook managers estimate the NFL accounts for around 55-60 percent of their annual football handle. From September through December, the books are up $98.16 million on football.

In comparison, the books won $54.2 million on basketball and $21.2 million on baseball in 2014. Both numbers were down, 8.36 percent and 26.88 percent, respectively, from 2013.

by Hoosier Econ

NCAA Merchandise Sales Helps College Students

image

When The Ohio State football team hoisted their BCS football trophy in the air earlier this month, students back in Columbus also got a boost from merchandise sales. Here’s more from The Columbus Dispatch:

Winning the first national championship in the new playoff system is a gift that Ohio State University officials expect will keep giving — and one that ultimately will benefit students.

They expect a $3 million bump in royalties over last year from licensed merchandise sales, based on anticipated revenue of $17 million in royalties this year.

Just how is the merchandise money divided at the university?

For every dollar that goes into the licensing office, 55 cents goes to academic affairs, which handles scholarships, libraries, ongoing programs and the university’s 14 college units; 15 cents goes to the athletics department; 15 cents goes to the alumni association; and 15 cents goes to the student life program and its 1,000 student organizations.

You can read the rest of the article here.

by Hoosier Econ

How Much Food Does it Take to Feed 2 College Football Teams

outback bowl
Outback Steakhouse sponsors the college football bowl game “Outback Bowl”. The Aubrun Tigers take on the Wisconsin Badgers and will be played on January 1, 2015. The two teams meet for dinner sponsored by Outback Steakhouse and here is how much food was there via the Bleacher Report:

Outback Bowl dinner for Auburn & Wisconsin: 750 pounds of steak, 900 lbs. of ribs, 750 lbs. of chicken, 1,600 shrimp, 1,200 lbs. cheese cake.

by Hoosier Econ

Big Ten Football = Lots of Money

 

ImageWant to know how much money Big Ten schools rank from football alone? A lot and they are about to become very much wealthier. Before one bashes this money, just remember the next time you see a “softball complex” or an obscure sports facility being built on a Big Ten campus, that funding probably came from Big Ten football itself.

Hat Tip to Mike Carmin and his Big Ten football money article on jconline.com. 

As a football enthusiast I remember very distinctly when the Big Ten Network kicked off in September 2007. The idea to air “Big Ten” only sporting events was laughed at by people not grasping the desire to see football games of all kinds. Six years later it is seen in almost 100 million homes in the U.S. and Canada. Financially it has paid its obligations and turned a profit just last year. Here is something else to ponder that Mike Carmin covered:

One year before BTN launched, the Big Ten Conference distributed about $14 million to each of its 11 schools.That was 2006-07. Six years later, that figure has jumped to more than $25 million.

 

Thats not all…..

According to documents obtained by the Journal & Courier from Purdue, the Big Ten is expected to distribute about $26.4 million per school after 2013-14 — and more than $35 million at the end of the 2016-17 academic year.

The robust payouts, which include a projected $30.1 million in 2014-15 and $33.3 million in 2015-16, will be sent to the core 11 Big Ten schools

Budgets vary greatly in the Big Ten when it comes to athletics. Ohio State currently operates a budget of $132 Million compared to Purdue who runs a budget of $70 Million. Here is the breakdown of revenue payments received:

Schools in the Big Ten share equally in the revenue generated by television contracts, NCAA distributions, bowl games — including Bowl Championship Series and the future College Football Playoff format — along with the gate receipts from the league’s men’s basketball tournament and football championship game.

The Big Ten is about to get a lot wealthier.  Many of their TV contracts are due to be re-negotiated in 2016-2017(Minus BTN which is a 25 year contract).

 

In 2006, the Big Ten signed a 10-year, $1 billion deal with CBS and ABC/ESPN for first-tier rights and a separate 25-year agreement with BTN. The Big Ten’s deal with Fox to broadcast the football championship game started in 2011 and ends in 2015.

Projections are just that, but the aforementioned $35 million per-school figure may pale in comparison to what each school will receive once the league’s next television contract is finalized.

“The ’16-’17 year is an important mark because that coincides with the end of our current television agreement with CBS, Fox and ESPN,” Traviolia said.

Look for many Big Ten schools to enjoy continued financial success well into the mid 2020’s and beyond. The next bigger task will be to break up the NCAA and let the conferences soak in their revenue they stockpile.