@happy1 Well you may be correct if you are counting all divisions. I don’t know if there is actual data for lower level schools. D2 schools “typically” get lower academic students and D3’s main focus is academics so they aren’t really in the “business” of D1 money making so to speak.
@happy1 Here’s an interesting article on D3 football making money for the schools.
https://deadspin.com/how-division-iii-colleges-profit-from-football-no-one-w-1440369611
@moscott I never said every lower division school lost money on athletics. And there are many articles online saying that most athletic departments lose money. In all honesty I think we are generally in agreement.
@happy1 " if you look at all college athletic programs over all divisions more lose money than make money." Not every but the implication to me was “most”. You may be correct but I’m not so sure that’s an accurate statement.
@moscott If you google you can find a lot of articles. Here are a couple:
http://www.acenet.edu/news-room/Pages/Myth-College-Sports-Are-a-Cash-Cow2.aspx
http://www.ncaa.org/about/resources/media-center/news/athletics-departments-make-more-they-spend-still-minority
Anyway I think we’ve exhausted this and I think we are in general agreement so no need to tag me further on this thread as I’m going to log off and watch the game.
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So at $25,100 for tuition, it takes 535 full pay students just to pay for the football coaches. I find this appauling.
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The premise is wrong. Tuition doesn’t pay football coaches’ salaries.
Earlier this week, Bama’s Nick Saban was asked if he’s worth the over $10M he’ll get this year in salary/bonuses. He humbly stated, probably not. But he is. He more than pays for his salary. His successes are bringing in $100M per year to the athletic program. UA football not only pays for itself, but pays for ALL sports’ coaches (male and female sports), their facilities (which are constantly getting first class upgrades), their travel costs, their uniforms, and their athletic scholarships. …and has a large profit after.
Based on any reasonable financial analysis, Saban (clearly the best college coach there is) is significantly over paid. The only reason he can make $10 million is because the college sports system is rigged in his favor.
Bama football takes in $105 million a year and Saban gets paid $10 million. In no other business will you find a CEO who gets paid 10% of total revenues.
In comparison, NE Patriots coach Bill Bellichik (clearly the best NFL coach) gets paid $7.5 million. Annual Patriots revenue is $523 million. But the Patriots have to pay their players ($160M annually). And the billionaire Patriots owners get paid dividends of the operating profit in the many many millions.
In Saban’s case, he gets his players at minimal cost. And the owner of the team (UA) stupidly lets the UA athletic department keep basically all of the profits, so long as they pay for the other non-revenue teams (whose costs are pretty low). So the profit margins for UA football are quite inflated, which allows them to pay Saban 2-3X what his actual economic value is.
A realistic model would have Bama paying the players $5-10 million per year. And Bama (as the team owner) should charge its football team an annual license fee (which could be used for academics) of maybe $30-40 million a year. If you’d run UA football like any normal business, Saban would make way way less. He gets paid $10 million by, essentially, pimping his players and his employer. And taking advantage of the cartel-like rules of the NCAA.
It is a boondoggle. UA football runs like a non-profit when it comes to player comp and owner comp. But then is run like a for-profit when it comes to paying the coach and AD. If you are going to run it like a business (which is the argument for Saban getting paid so much) then you should run it like a real business. Rather than a faux business rigged to enrich the coaches and athletic administrators.
Let’s say you can eliminate the duplicate coaches salaries and funnel that money to scholarships. How far would you go to further the goal of channeling athletic profits to students? Do you eliminate sports that do not create a profit as they are using $$$ that could be spent on merit scholarships/financial aid?
@mom2collegekids - using Nick Saban as a proxy for anything is misleading and/or wrong.
https://www.scribd.com/book/120628722/NCAA-Spending-Study
How many students at Alabama are borrowing money? Sure, $70 for student tickets to 7 home games isn’t crazy, but would it make sense to pay Saban $2.1M less and give the 210,000 student tickets sold (assuming 30,000 per game…far too high) back their money?
@northwesty is on point. It’s a for-profit enterprise that nobody on the inside wants to end because everyone is increasing their value…the coaches (who all point to 'bama and Michigan), the AD’s (their bosses?), and the University Presidents. The new Alabama AD is making $900k (up 50% over the last one), and the President of the school makes a paltry $535k. Even if Alabama is making money after all of this, does anyone think they couldn’t hire a coach for say $1M? Or find an athletic director for $500k? It’s a machine that keeps feeding itself, and ultimately taxpayers or students borrowing money are unwittingly paying the price.
Taxpayers are funding entertainment via a minor league system for the NFL. Universities competing with the NFL for coaching talent is wrong. If an NFL team wants to pay someone $100M per year to coach, it’s entirely up to them. When thousands of students are borrowing money to pay for a national program of entertainment via tuition and fees for a degree they may never benefit from in an ever shrinking professional world, we collectively need to evaluate our values.
Isn’t the real shame that coaches are making multi-million dollar salaries and their players are getting relatively nothing for putting their bodies and brains on the line?
“How far would you go to further the goal of channeling athletic profits to students? Do you eliminate sports that do not create a profit as they are using $$$ that could be spent on merit scholarships/financial aid?”
Any real business would compensate Saban and the AD through some form of profit sharing. Giving them a percentage of the net profits that the athletic department pays out to the owners (which is the university). That would give them an incentive to increase the payout to the owner/school, which would come via revenue increases and expense controls. Instead, Saban and the AD get paid as if they are the team owners rather than team employees.
Bama athletics does pay out about $10 million annually to the academic side for faculty salaries and merit scholarships. Plus they pay $16 million to academics to pay for the athletic scholarships they consume. They could/should easily pay out another $20 million to academics, but instead the school let’s them keep all that profit to spend on themselves. It is in no way run like a business on the comp side.
But the real damage of how Saban gets paid is that he sets the market through the BS business model. So lots of other schools over pay their coach at $2 or 3 million, even though their athletic departments run at a loss and need to be subsidized with tuition dollars. Which, as Ivyvee correctly points out, is the norm in D1.
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Bama football takes in $105 million a year and Saban gets paid $10 million. In no other business will you find a CEO who gets paid 10% of total revenues.
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You’re sort of assuming that Bama Football has a huge number of employees, where it would be strange for the head guy to earn 10%. Bama football employee count is probably more similar to a small business, and I’ve seen many small businesses where the head guy makes 10% or more particularly when profits (after paying all salaries, capital improvements, benefits, rent, insurance, etc) are running about 50%.
But in your example the head guy is getting paid that because he OWNS the business. Saban is just a hired hand – he didn’t build that. I’m all ears to hear about any non-owner employee of a $100 million business that gets paid $10 a year.
The key things are that Saban is only required to pay the owner a piddly $10 million a year. That number should be more like $30-40 million if it really were operated as a business. And Saban’s most valuable employees (i.e. players) get paid well below their value due to the rules of the NCAA cartel.
It is very misleading to say that the Bama athletic department is run like a business, even though it takes in significant revenues. Their “profit margins” are pretty fake.
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Sure, $70 for student tickets to 7 home games isn’t crazy, but would it make sense to pay Saban $2.1M less and give the 210,000 student tickets sold (assuming 30,000 per game…far too high) back their money?
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That would be a very stupid thing for Bama to do and it has nothing to do with money. Your suggestion suggests that you have no idea how things work at a school with a very popular football program. There’s a nominal cost simply to discourage kids who have no intention of attending to not get tickets, leaving empty seats that someone else would have wanted.
No way are there 30,000 student tickets available per game. even if a school’s team is popular it’s naive to think that nearly all of the school would attend every game. There are about 17,000 student tix per home football game.
The real question is how much would it cost to get Saban away from Bama?? That is his value. He is no hired hand. He is Bama Football today. Players come and go as do assistant coaches etc.
BTW student tickets for football at Bama sold out in 1 minute. Maybe the price is too low?? https://thetab.com/us/alabama/2016/04/27/alabama-football-tickets-sold-within-minutes-people-not-happy-398
BIG has some high $$$ coaches too. And $3 M does not buy much.
@mom2collegekids - I’m pretty sure somebody in Alabama could find a solution (like scanning tickets, which I assume they already do) to determine who is grabbing all the tickets just to create the vacant seat problem.
Could it be that some are buying tickets to scalp them? Is the problem that the school figures they might as well get a piece of the action? The school could assign student tickets to student ID’s, and swipe the kids in…like they do every meal.
17,000 tickets only reinforces my point…poor Nick only has to surrender $1.2M.
FWIW…I’m a Big 10 Alum. Might be a bit more academic and a bit less footbally than the SEC, but the last time I checked we had the largest 3 stadiums in the country (vs. Alabama at #7). I haven’t been to campus in a while, but I hear football is still pretty popular.
@Eyevee-You are assuming that the money paid to coaches is coming from taxpayers and could simply be diverted to other purposes. For big time football programs this is not true. The money to pay coaches their huge salaries is typically not taxpayer money and could not simply be diverted to other purposes.
@proudp - There are 129 FBS teams…how many schools in that number don’t pay anything for their coach? A dozen? 2 Dozen?
Using Saban and Alabama as the example (or the SEC) misses the point. For every Saban / Alabama there is a Lane Kiffin / Florida Atlantic. Kiffin is making $950k. The offensive coordinator at FAU makes $350k. The coaching budget after Kiffin is $1.7M for 9 assistants. $2.65M…Anyone willing to suggest the students aren’t paying for that somehow?
Students are borrowing hundreds of millions of dollars to fund the arms race in D1 football. That’s not an opinion.
EDIT: FAU averaged just over 10,000 fans for the 7 games last year, including 5,800 for the final game. Check the budget…they’re running $3M / year in amortization on the stadium. I’m sure Lane will fix all of this.
No NFL coach makes what Saban makes.
Not even Bellicheck, who has had just as much success as Saban if not more.
Even though the lowest NFL team (Buffalo Bills) takes in double what Alabama does. And the highest NFL team (Dallas Cowboys) takes in 5X what Bama does.
But the UA football team (unlike the Bills or the Cowboys) doesn’t have to pay its players or its owner. So it has piles of fat stacks laying around that it has to spend on something. It really isn’t a business or a market in any normal sense of the word.
That’s a false equivalency. That money exists solely bcos the Athletic department exists, and IT exists solely due to the revenue sports of football and basketball. Get rid of the sports coaches and there is no money for those 535 students.