Money making and College Football.

davidash_ms_600This is reader submitted piece. It is an interesting take on the current money making monster college athletics has become.

Author: Claire Jacobs

How much money does college football generate?

The easy answer: a lot.

Between broadcast deals, ticket sales, merchandising, sponsorship deals and donations, it’s no secret that college football is a cash cow – one which shows no signs of slowing down any time soon.

In the last two years alone, more than 30 colleges have switched conferences, primarily for one reason: the cash and exposure from college football television and the possible increases in revenue. Thankfully due to the ACC’s recent GOR, expansion at the power conference has probably come to an end.

That said, the potential is huge and everyone is aware of it. The Texas Longhorns, college football’s most valuable team, is worth $133 million.  The combined revenue for the 15 richest college teams topped $1 billion in 2010.

Interestingly, while the Big 12’s conference distributions increased to $19 million in 2011, about 40% of Texas’ football income still came exclusively from ticket sales ($32.4 million) and sponsorship ($8 million). This was down when last year Texas hosted one less home game than the year before. USA Today’s recent revenue report now has Texas at whopping $163 Million.

Home games are key to profits in college football. Not only do they represent a time to fill seats which equals ticket sales, but thanks to the enhanced exposure television networks now offer, the colleges are entering into markets where new viewership exists and alumni are encouraged to give back.

Texas’ income is derived not only from deals from Coca-Cola, Nike, and Gatorade but from the $30 million in contributions tied to amenity seating like club seats and luxury suites – all increasing annually thanks to network exposure.

The money generated around the sport is only growing.  Economics on the periphery of the sport – including income brought to local businesses and sports betting made worldwide and online at sites like Intertops pokies, only contribute to the overall money making machine college football has become.

With the college football revenue debate currently raging, it won’t be long before prices are hiked to ensure these colleges make more money. We are already seeing ticket price increase around the country.

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