UT’s Football Program Is the Most Profitable in the Country. By a Lot.
UT’s football season has roughly met expectations: The team wasn’t supposed to be very good and they’re not very good. Charlie Strong was brought in to recruit better classes going forward, but in his first year, a 3-4 record is about as good as the team could hope for. Still, none of that really matters when you look at the primary metric one can use to judge football success. Who cares about a winning record when the revenue for the program a whopping $109 million, almost $30 million more than the next-closest school?
That’s the takeaway from an analysis provided by The Business of College Sports, a self-explanatory blog that offered some specific numbers on the most profitable college football programs in the country, a list that Texas tops handidly.
The details from TBCS are worth a deep look, as they go inside the numbers fairly comprehensively, breaking down the various revenue streams that each program has and how much they contribute. At Texas (as with most programs), the number one source of revenue comes from ticket sales, worth a tidy $34 million—more than the entire football program’s expenses of $27 million all by its lonesome. Factor in that $30 million from contributions, the $15 million from NCAA and conference distributions, and the $25 million worth of royalties, licensing, advertisements, and sponsorships (most of which comes from its deal with ESPN for the Longhorn Network), and you get the bulk of that $109 million from just four sources. Merchandising, gameday concessions, and parking add another $1.5 million, and some pocket change from sports camps, guarantees, endowments and investments, and other sources, and you get the picture.
If the Texas football program generates $109 million in revenue, and costs $27 million to operate, there’s a hell of a lot of money left out there to play with. And that’s basically what happens, according to the blog:
What happened to the $82.3 million in excess revenue from football? Along with excess revenue from men’s basketball, it essentially funded the rest of the athletic department. Sports outside of football and men’s basketball operated at a total loss of $14.8 million, and the department had another $64.4 million in expenses not directly attributable to just one team. Texas also reported contributing $9.2 million to the University of Texas for non-athletic initiatives.
If UT sports that aren’t football or men’s basketball cost $79.2 million to operate, then most of that $82.3 million gets eaten away by, say, rowing, volleyball, or softball. It’s unclear from this how much money men’s basketball contributes to the pie, although we can assume that it’s a substantially smaller number than football (enough that the football program can contribute $9.2 million to non-athletic initiatives at UT, though).
In any case, these numbers offer some perspective on things that had been discussed recently. If UT had offered Nick Saban or Jim Harbaugh a $10 million/year contract before hiring Charlie Strong, that number wouldn’t really be shocking given that it would only raise the operating costs of the program by a small percentage of revenue.
It also sheds some light on the long-discussed idea of paying student athletes for their contributions to the school. In the lawsuit filed by the Northwestern University football players, they argue that the profitable programs should pay their athletes, and if that $9.2 million were dispersed among the 85-man football roster, that’d be over $108,000 a year per player—not quite an NFL salary, but a hell of a lot of money for a college student.
In fact, you could disperse $9.2 million among all 525 student athletes involved in intercollegiate play at the University of Texas and still pay everyone—star quarterback or star setter on the volleyball team—$17,000 a year for their work. As “professional athlete” wages go, that’s practically nothing, but as an “undergrad getting paid for working for the school” wage, it’s probably about right.
None of this makes any of that more likely, of course, but it’s interesting to have the numbers in front of us that tell us how it all could work, in any case.