Wednesday, August 28, 2013

Special Commentary: The Cardinal and the Network

What is the current relationship between college athletics and television networks?  I have been asking myself that question over the last few days. 

We as fans read about how networks like ESPN, CBS, Turner, FOX, and NBC have been negotiating multi-billion dollar contracts with the NCAA and major collegiate conferences over broadcasting rights for college football and basketball games.  Even major conferences like the Big Ten, the SEC, and the Pac-12 have created their own television networks in order to reach wider audiences.  This larger exposure often results in more revenues for conferences and college athletic departments in the form of cable subscription fees, advertisements, alumni donations, and larger game-day ticket sales.  Teams have even changed conferences for the purpose of generating larger revenues for their programs (The recent defection of Maryland, a program carrying $50 million in debt, from the ACC to the Big Ten is one such example).  However, a front-page article from Monday's New York Times has revealed a new kind of partnership that ties the fortunes of singular teams/schools to the scheduling demands of a major network.

Monday's article, At Louisville, Athletic Boom is Rooted in ESPN Partnership, discussed how the University of Louisville's athletic program, in particular its football team, went from national insignificance into a top-tier BCS contender over the last sixteen years.  Back in 1998, Louisville was mainly known for its relatively successful men's basketball program (it won two national championships during the 1980s), but it had an athletic department that was struggling to pay its bills on a meager $14 million budget.  It was also an institution that had only begun to establish itself as a public university.  Indeed, Louisville was only a small, private college when it joined the Kentucky state system back in 1970.  Thus, in 1995, Louisville's president, John W. Shumaker, the college's board of trustees, and its athletic director, Tom Jurich, decided to build the football program as a way to bring national attention to their university.  In so doing, the university invested in new facilities like Papa John's Stadium and hired coaches like John L. Smith, Bobby Petrino, and Charlie Strong to make Louisville into a BCS-level program.  

But where did ESPN fit into Louisville's grand plan?  Well, in the early 2000s, the network was looking for teams who were willing to play on midweek days like Tuesdays and Wednesdays.  Since universities in major FBS conferences were reluctant to host midweek games, mid-major conferences like Conference USA were willing to accommodate ESPN's demands to play on nontraditional days in exchange for national television exposure.  As a result, Conference USA, prior to the 2001 season, signed an agreement with ESPN worth $80 million.  Since Louisville was a member of C-USA at the time, they were "more than happy," according to The Times, to play midweek games on national networks like ESPN and ESPN2.  This exposure, along with the efforts of Coach Smith and his successors to turn the Cardinals into a winning program (Nine bowl appearances between 1998 and 2006, including a win in the 2006 Orange Bowl, and a Sugar Bowl victory in 2012) enabled Louisville to join the Big East in 2005 and ultimately move to the ACC in 2014.  Moving to better conferences meant greater television revenues, and Louisville is currently projected to make $16 million per year when it joins the ACC.

So it seems that Louisville is a success story with the way in which it built its athletic program into a national power.  The increased exposure from its agreement with ESPN, according to The Times, also allowed the Athletic program to hire Rick Pitno as the head coach of its men's basketball program and finance "a $256 million athletic building boom."  Even the university's academic departments have benefited from the rise of Louisville athletics.  Since 1998 the university's research budget has increased, the number of endowed professorships has gone up fivefold, the university has had 36 Fulbright scholars between 2010 and 2012, and donations from wealthy alumni have amounted to $1 billion since 2004.  And it was made possible by Louisville's willingness to play its games in accordance with the scheduling demands of ESPN and its affiliates.

When I read this article, I was very concerned if what was happening to Louisville was going to be the future of college athletics.  Obviously the Cardinals have benefited from their partnership with ESPN and the network enjoys high rankings from its midweek football telecasts.  As one former ESPN executive, Loren Matthews, put it, according to The Times, "As we cleared more homes, bigger conferences saw more dollars and better exposure . . . schools would say:  "We'll play on any night.  Do you want us to start at 9, or do you want us to start at 6?"  But all this new exposure comes at a price, it seems to me.  Universities are deferring to corporate entities over how they should schedule games and a corporation like ESPN is going to set up a schedule that benefits their long-term interests (money and publicity) rather than those of the university and its students.

Speaking of students, how do they benefit from the increased revenues that athletic departments receive from television agreements?  The answer is, not that much.  At a time when athletic departments take in more revenues, college costs are still increasing because many states have cut education budgets over the last several years. Tuition costs go up and students go further into debt by borrowing more money to pay for a college education.  Rather than help the students by using their increased fiscal resources to control rising Tuition costs, athletic departments all over the country have opted for building more facilities, renovating stadiums, and paying larger salaries to coaches and administrators.   Louisville's success, in turn, perpetuates the current national "arms race" in constructing modern athletic facilities designed to attract the best recruits and coaching staffs that money can buy.

But, is Louisville's successful arrangement with ESPN a long-term phenomenon?  I guess as long as people are willing to go see their favorite college teams play at any day of the week, and as long as people pay subscription fees to cable companies, then I imagine it can sustain itself for the time being.  But because money is what drives the relationship between college teams and television networks, which one gets to make the rules over scheduling?  Television stations have the airwaves and they decide who gets aired and who gets preempted.  But universities have the teams that enable the networks to get the ratings they need to sell advertising.  So the business relationship between college teams and television stations can be fairly complicated.  But, at the end of the season, the entity that ultimately wins may not be the one hoisting the crystal football. 

n.b.  When I first posted this commentary, the New York Times' website had been down for the weekend.  Now that their website is back up, I can post a link to the article in question:  http://www.nytimes.com/2013/08/26/sports/at-louisville-an-athletic-boom-made-for-and-by-tv.html?pagewanted=all&_r=0

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