March Madness It Is, Economically

[American X]

WSJ article on how basketball is an economically losing proposition for most schools.

It breaks down NCAA payments, using the Atlantic 10 as example:

"If everything goes according to plan and the team makes it to Madness, here's the payoff. For each game that a team plays up to the finals, the team earns one credit unit from the NCAA. Every year there are 126 credit units awarded.

In 2007-08, each unit was worth $206,020. A school that goes to the finals earns five credits that year, worth just over $1 million, which is then divided among the universities in the conference.

The schools in the Atlantic 10 conference, for instance, earned 27 units last year (these units represent six years of accumulated tournament wins for conference schools) and the NCAA sent the conference a check for $5.56 million. This check was then divided up among the 14 schools in the conference, or $397,143 each. Of the 32 Division I conferences, 23 earned less Madness money than the Atlantic 10, with most of these conferences earning below $1.5 million. The biggest prize in 2007-08 went to the Big East Conference. Its 16 schools divided just over $19 million, or $1.2 million per school -- possibly enough to pay the head coach's salary."

Full Article (http://online.wsj.com/article/SB123664681664078731.html)

[Masterofreality]

WSJ article on how basketball is an economically losing proposition for most schools.

It breaks down NCAA payments, using the Atlantic 10 as example:

"If everything goes according to plan and the team makes it to Madness, here's the payoff. For each game that a team plays up to the finals, the team earns one credit unit from the NCAA. Every year there are 126 credit units awarded.

In 2007-08, each unit was worth $206,020. A school that goes to the finals earns five credits that year, worth just over $1 million, which is then divided among the universities in the conference.

The schools in the Atlantic 10 conference, for instance, earned 27 units last year (these units represent six years of accumulated tournament wins for conference schools) and the NCAA sent the conference a check for $5.56 million. This check was then divided up among the 14 schools in the conference, or $397,143 each. Of the 32 Division I conferences, 23 earned less Madness money than the Atlantic 10, with most of these conferences earning below $1.5 million. The biggest prize in 2007-08 went to the Big East Conference. Its 16 schools divided just over $19 million, or $1.2 million per school -- possibly enough to pay the head coach's salary."

Full Article (http://online.wsj.com/article/SB123664681664078731.html)

All the more reason to be pissed at the pikers like Fordham, Dookcane, LaSuck and their ilk for just scarfing off of the programs that actually care. First, they contribute nothing. Second, they drag down an RPI costing better seeds. Three, they take a full share of money. If they were kicked out, there would be more money to share, and each share would be divided among less teams making even more money.

If the A-10 divides everything equally, with no extra share amount for the school that actually earns it, that is a pile of sheet.

[MADXSTER]

This is also why they will not leave voluntarily.

[waggy]

All the more reason to be pissed at the pikers like Fordham, Dookcane, LaSuck and their ilk for just scarfing off of the programs that actually care. First, they contribute nothing. Second, they drag down an RPI costing better seeds. Three, they take a full share of money. If they were kicked out, there would be more money to share, and each share would be divided among less teams making even more money.

The Mountain West teams figured this out a while ago and decided to start their own conference.

Actually, it likely had a lot more to do with football, but the same ideas apply imo.

[X-band '01]

Is this why Utah and BYU have never considered joining the Pac-10? Are they that much better taken care of by the Mountain West brass?

[GoMuskies]

Is this why Utah and BYU have never considered joining the Pac-10? Are they that much better taken care of by the Mountain West brass?

I think it has more to do with the Pac-10 not wanting them.

[Fred Garvin]

Think of how many toureys Calhoun and UCONN have made. This sports socialism is a great justification for his salary. The bottom-feeding Depauls of the world would be wise to pay their coach zilch while encouraging UCONN to do whatever it takes to keep Calhoun in the league.

[dc_x]

This article doesn't make much sense.

First of all, I thought the A10 had a system to pay more of the NCAA revenue share money to the schools that actually made the tournament. I'm pretty sure I read that somewhere.

Secondly, this article makes it sounds like college basketball is a bad business proposition for a college because the NCAA revenue doesn't cover all the costs involved in getting there. But what about all the other revenue that a team generates in a year? Xavier's $400k of NCAA revenue is a drop in the bucket compared to revenue generated from season tickets, seat licenses, TV contracts, concessions, advertising, etc.

I think it's pretty safe to say that Xavier basketball is profitable. In fact, didn't Fortune or Forbes put a multi-million dollar value on the Xavier basketball program?

Add to that the free advertising for the university that basketball creates. It's no coincidence that the number and quality of applications to attend Xavier has increased in the last 25 years.