In US college sports, it’s all about business
Imagine a sports league in which teams didn’t have to pay salaries to star players, but still collected tens of millions of dollars in revenue by selling out every game, securing massive sponsorship deals and landing huge television contracts.
Instead of struggling to get by like most of today’s professional clubs, without the burden of million-dollar player contracts these teams would produce enormous profits for their owners.
Despite the fact that it’s the players the ticket buyers and television networks would be paying to see, they would have no income or long-term contracts or job security of any kind. No union or players’ association would fight on their behalf.
In fact, it would be illegal for teams to give them almost anything in return for their hard work. The league would dish out tough penalties if a team so much as handed a player an envelope of petty cash or the use of a vehicle to get to and from the games.
Massively unfair to the players? Maybe. But a ridiculous notion that would never be possible in this day and age of collective bargaining in sports?
Not at all.
That’s exactly the operating model for U.S. college sports.
So, you may think the child sexual abuse scandal at Penn State is about ethics and morality, or even sports. But it’s really about big business.
And until that dynamic changes, the culture of preserving the revenue stream at any price – even the safety of children – will continue.
Last year, the Nittany Lions had revenue of $73 million U.S. The team plays in a stadium with more than 100,000 seats and ticket prices average well over $100.
By comparison, according to Forbes, the Ottawa Senators generate about $96 million in annual revenue.
But thanks to their roughly $60-million payroll, the Senators lose a few million bucks at that revenue level. The Nittany Lions, on the other hand, make a $53-million profit.
That’s a 73-per-cent profit margin, enough to make a Fortune 500 CEO drool. And that doesn’t include the impact of the football program and coach Joe Paterno on the school’s overall fundraising.
Successful sports programs are a recurring Superball lottery win for U.S. colleges. Much of the cash is put to good use; Penn State is considered one of the top research universities in the country, for example.
But the cash flow creates a dependency on sports that makes it difficult for universities to put in jeopardy. So when a scandalous or criminal allegation is raised, it may be morally right to conduct a public investigation or go to the police, but it’s not in the best financial interests of the school.
Still don’t think college sports is about money? Already the credit-rating agency Moody’s is looking into downgrading Penn State on the assumption that it will lose sponsorship, donations and enrolment as a result of the scandal and the firing of Paterno. Any change would mean the university would pay much more annual interest on its $1-billion debt.
None of this justifies the actions of school officials who turned a blind eye to the worst possible allegations against an assistant coach. As administrators and, frankly, as human beings, they had an obligation to contact the police.
But it does help to explain how, like governments and their gambling revenue, U.S. colleges have become addicted to cash from sports. College athletics are more about the bottom line than even professional sports. And that means that moral and ethical considerations – like what happens to the players who take lame courses to focus full-time attention on football, but don’t make it to a lucrative career in the NFL – are easily and regularly set aside.
“College football and men’s basketball have drifted so far away from the educational purpose of the university,” James Duderstadt, a former president of the University of Michigan, told the New York Times. “They exploit young people and prevent them from getting a legitimate college education. They place the athlete’s health at enormous risk, which becomes apparent later in life. We are supposed to be developing human potential, not making money on their backs. Football strikes at the core values of a university.”
Joe Paterno and other Penn State officials deserved what they got. But if the goal is to prevent another coverup from happening, firing a few people won’t be enough.
The entire system of U.S. college sports is structured to encourage looking the other way when there’s a threat to the program. As long as sports are a giant cash machine for colleges, the temptation to avert the eyes and protect the profits will persist.
Mark Sutcliffe writes about business, sports and running for the Citizen
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