Meanwhile, down to the wire on O'Bannon v. NCAA

[swood1000]

Nothing wrong with that.

Get back to me when your city has conspired with 1000 other cities across the USA, made utter dedication to golf a condition of city residence, dictated what outside contacts a resident may & may not have, and threatened to blackball them from the other 999 cities if they disobey.

Could you explain what "made utter dedication to golf a condition of city residence" is analogous to for college athletes? They can turn pro any time they want to. The D-League and other options are there for those just graduating.

Consider the National Amateur Golf Tournament. Does this involve a national conspiracy to dictate to amateur golfers and threaten to blackball them if they disobey? There are no doubt hefty revenues from televising that tournament. Do you have a principled reason for saying that those revenues need not be distributed to the athletes but that the revenues of March Madness must be? What is the principle?

[swood1000]

so you're saying these athletes who deserve to be paid actually do have alternatives to get paid, but are freely choosing the terribly unfair package offered by a member of the ncaa "cartel"? i wonder how the schools are pulling this off - must be some sort of evil magic, because certainly the deal is not fair.

apologies for the sarcasm - couldn't help myself as i am emotionally vested on the other side of the argument. simply put, if duke (or any school) competed for athletes on salary, i'd probably lose all interest and advocate converting to a div2 program or whatever the alternative would be. you think keeping athletes eligible was a conflict before, well wait until you start paying someone a hefty salary...

I guess there would also have to be a kind of high-school draft, so that the top players would have no choice but would have to go to the university that drafted them. Otherwise, the top talent would be bought up by the team with the deepest pockets. But perhaps the proponents of paying college athletes would have no problem with this since it's just a job, the same as when the pros get drafted.

So, Kenpom lists 351 Division I basketball teams, with Grambling St. bringing up the rear. Does Grambling St. get first pick in the draft? What if Grambling St. doesn't offer as much as Kentucky? Or, if recruits will be permitted to choose any school they want, then a wealthy alumnus of Grambling St. can supply them with next year's national championship team, perhaps with the understanding that he will share in the proceeds. I agree with you about the effect that this will have on the popularity of college basketball.

[sagegrouse]

I am not sure I should step into this discussion, but I do have a point of view: Let me posit a "strategic landscape" of sports in America that is wildly different from almost all other countries: "revenue sports" and Olympic sports for those under 21 or 22 tend to occur at colleges and universities, not at athletic clubs like Real Madrid, as in Spain and elsewhere, or other sports entities.

A few observations are appropriate: this is a huge "business," whether it obeys all the rules of normal business practice . ("More than 460,000 NCAA student-athletes – more than ever before – compete in 23 sports every year.")

The economic model is full of contradictions: the athletes are "amateurs," but actually they are compensated for their college expenses and expected to make normal academic progress. (And don't get me started on the "pure-as-the-driven slush" Ivy League -- it's basically a "recruited athlete model" just like everyone else.)

Also, the most important university programs, including Duke, generate more than $50 million in athletic revenue every year. (The semi-authoritative USA Today annual study shows 55 public universities above $50 million, omitting private schools like Duke, Notre Dame, Stanford, USC, etc.) Definitions differ, but "revenue" includes gate receipts, TV and other media fees, contributions by individual donors, subsidies from the university or its students ("athletic fees").

Clearly, this model faces some challenges in the courts and elsewhere, such as in proposals that the athletes be compensated somehow for use of their personal images.

If we decide to change fundamentally the basic student-athlete model, either through de-emphasis of athletics or through a fully professional college model with salaries, I expect the magnitude of the earthquake resulting would destroy college athletics as we know it.

And maybe we should do that, but as a consumer and fan, I think there are some real positives in the current model.

[swood1000]

If we decide to change fundamentally the basic student-athlete model, either through de-emphasis of athletics or through a fully professional college model with salaries, I expect the magnitude of the earthquake resulting would destroy college athletics as we know it.

What do you mean by a de-emphasis of athletics?

[sagegrouse]

What do you mean by a de-emphasis of athletics?

Division II (partial scholarship) or Division III (no scholarship) models would qualify. also, limits on athletic spending, coaches salaries, etc.

[swood1000]

Division II (partial scholarship) or Division III (no scholarship) models would qualify. also, limits on athletic spending, coaches salaries, etc.

What would be wrong with limits on athletic spending or coaches salaries, so that all Division I programs would spend roughly the same amount, or up to a certain limit? It doesn't seem that that would destroy college athletics as we know it. How does the Ivy League get around the supposed restriction on athletic scholarships? Suppose we truly banished athletic scholarships. The quality of play would be reduced but to what level? To that of Nick Pagliuca? Would that really cause the fans to lose interest? Isn't it possible that it would increase fan interest since the players would seem more like "real students"?

[acdevil]

No disrespect to Nick Pagliuca, but Yes.

[swood1000]

No disrespect to Nick Pagliuca, but Yes.

I'm not so sure. I think that people look at these things relatively. The quality of college play is well below that in the NBA but that doesn't make people less enthusiastic about college games. We're not talking about substituting some players who are klutzes, just players who are a little bit slower. But since all the players would be a little bit slower it wouldn't stand out.

In any event, there would be enough Ryan Kellys to keep things interesting.

[lotusland]

Wait I'm confused. Why do we have to do a way with scholarships and play with walk-ons again?

[sagegrouse]

What would be wrong with limits on athletic spending or coaches salaries, so that all Division I programs would spend roughly the same amount, or up to a certain limit? It doesn't seem that that would destroy college athletics as we know it. How does the Ivy League get around the supposed restriction on athletic scholarships? Suppose we truly banished athletic scholarships. The quality of play would be reduced but to what level? To that of Nick Pagliuca? Would that really cause the fans to lose interest? Isn't it possible that it would increase fan interest since the players would seem more like "real students"?

I am not supporting or opposing any such moves. My position is that college athletics today, warts and all, is a powerful economic model that brings pleasure and enjoyment to the American people. I'd be careful about making major changes, whether piecemeal or across the board.

If I were to respond to your proposal on spending and coaches salaries, I would say that the major schools would never stand for the changes and would leave the NCAA and found their own set of super conferences. Duke would be among them.

WRT the Ivy League, which I did not attend but did help pay for a student there, all athletes in the major and most minor sports are recruited. They have to meet Ivy League academic minimums (which can differ a bit by school); then, if they are really good and have no other flaws, they are admitted -- subject only to a limit on athletic exceptions by sport. I had a friend whose son went for a recruiting visit to Penn and a group of prospective athletic recruits was told by an Asst. Admissions Director (presumably inexperienced) that they would never be considered for Penn EXCEPT for their athletics. The kid was totally insulted and went elsewhere.

Ah, yes, the lack of an athletic scholarship fund? Of course, athletic scholarships are paid from the general scholarship fund. And it's getting easier every day: the Ivy Leagues schools have a commitment to meet the total financial needs of their admitted applicants. Helps a lot, doesn't it?

[swood1000]

Wait I'm confused. Why do we have to do a way with scholarships and play with walk-ons again?

The question is whether that would destroy college athletics as we know it.

[Bluedog]

What would be wrong with limits on athletic spending or coaches salaries, so that all Division I programs would spend roughly the same amount, or up to a certain limit? It doesn't seem that that would destroy college athletics as we know it. How does the Ivy League get around the supposed restriction on athletic scholarships? Suppose we truly banished athletic scholarships. The quality of play would be reduced but to what level? To that of Nick Pagliuca? Would that really cause the fans to lose interest? Isn't it possible that it would increase fan interest since the players would seem more like "real students"?

A Duke scholarship is worth a lot more in $$ amounts than a school like UK. That would seriously put Duke at a disadvantage because giving 10 scholarships is considerably more money at Duke than a state school. On the other hand, going to a no scholarship model would probably help a school like Duke (and Stanford) that are committed to meeting the financial needs of the ENTIRE student body and have significant financial resources pouring into financial aid (Duke isn't Harvard level, for sure, but is much better than 95% of DI with regards to generosity of financial aid). (Would likely also help state schools securing in state talent since tuition is much less.)

[swood1000]

I'd be careful about making major changes, whether piecemeal or across the board.

Agree absolutely.

If I were to respond to your proposal on spending and coaches salaries, I would say that the major schools would never stand for the changes and would leave the NCAA and found their own set of super conferences. Duke would be among them.

I could see them doing that if they were faced with losing their revenue, but not necessarily if they were faced with spending caps.

And it's getting easier every day: the Ivy Leagues schools have a commitment to meet the total financial needs of their admitted applicants. Helps a lot, doesn't it?

Yes, there were some hidden benefits in the decision to do that.

[lotusland]

The question is whether that would destroy college athletics as we know it.

Yes. Yes it would. However college sports would be fine without athletes who are pro-ready. If there were no age restrictions on pro ball, the effect, if any, on college sports would be minimal.

[swood1000]

A Duke scholarship is worth a lot more in $$ amounts than a school like UK. That would seriously put Duke at a disadvantage because giving 10 scholarships is considerably more money at Duke than a state school. On the other hand, going to a no scholarship model would probably help a school like Duke (and Stanford) that are committed to meeting the financial needs of the ENTIRE student body and have significant financial resources pouring into financial aid (Duke isn't Harvard level, for sure, but is much better than 95% of DI with regards to generosity of financial aid). (Would likely also help state schools securing in state talent since tuition is much less.)

I was assuming that the limits on athletic spending would not take into consideration the amount charged for tuition but would say that each school is permitted X number of scholarships and in addition to that is permitted to spend $Y on coach salaries and other expenses of the program.

[swood1000]

Yes. Yes it would. However college sports would be fine without athletes who are pro-ready. If there were no age restrictions on pro ball, the effect, if any, on college sports would be minimal.

Why would it destroy college athletics as we know it? You wouldn't be interested in watching a team made up of Ryan Kellys and Nick Pagliucas, assuming all the other teams had similar talent?

[swood1000]

Wait I'm confused. Why do we have to do a way with scholarships and play with walk-ons again?

But they needn't play solely with walk-ons. They could still recruit players, but there would be no athletic scholarships. Academic scholarships would still be available and I'm not sure how the mechanism would work by which the NCAA would determine that player X would not have been given an academic scholarship but for his basketball aptitude, so the scholarship is termed an athletic one and player is ineligible. I guess that while such attributes as musical ability could qualify one for entrance or for a scholarship the same would not be true of athletic ability.

[ChillinDuke]

First off, I've enjoyed reading your continued analysis of the legal battle here - so thank you. Your recent posts have taken a turn toward asking questions regarding opinions on certain hypothetical situations. I'm not sure I necessarily follow where you're going with these hypotheticals. But I'll play.

What would be wrong with limits on athletic spending or coaches salaries, so that all Division I programs would spend roughly the same amount, or up to a certain limit? It doesn't seem that that would destroy college athletics as we know it.

Nothing would be "wrong" with it, but it would undeniably change the, let's call it, "marketplace." Marketplace for what? Marketplace for development of athletic skill. By imposing an artificial spending cap on the current framework (at the discretion of universities to decide where to make any required spending cuts within the program), do you agree that in theory my so-called marketplace will offer comparatively less to the athlete from which he can develop his skill. I think that point is more or less clear. The part that gets less clear is the ramifications of the "less"-ness. I'm sure many different possibilities could be envisioned, but I'll offer the first theory that pops into my head. It starts with the decreased resources that the spending cap produces, let's assume it's a somewhat significant decrease or at least not insignificant. So, for example, you'd have a scenario where if schools decide to reduce coaching salaries to stay under the cap, you'd presumably have some coaches departing for other places where they can make more money that isn't artificially capped. As such, coaching suffers. Or apply the scenario I just hypothesized to any other spending stream: gyms, travel, workout facilities, etc. As a result of this, at least directionally I have to assume a subset of athletes will substitute away from the college route and a new market will either be created or an existing market will increase in size which can absorb athletes that believe they have a chance to go professional (which is probably a much larger amount of athletes than actually does go pro) in order to maximize their potential via maximal facilities, coaching, etc.

Now based on my hypothetical outlined above, and depending on the "not insignificant"-ness of any imposed cap, the playing pool may become considerably weaker. Enough so, that I would say it could absolutely "destroy college athletics as we know it." I won't say it would, but it absolutely could. Especially if the cap was so punitive that it was trying to level the playing field across the entirety of Division I.

How does the Ivy League get around the supposed restriction on athletic scholarships?

Sage took care of this part.

Suppose we truly banished athletic scholarships. The quality of play would be reduced but to what level? To that of Nick Pagliuca? Would that really cause the fans to lose interest? Isn't it possible that it would increase fan interest since the players would seem more like "real students"?

This is a trickier one - and I'm not sure if it was meant as more of a follow up on the Ivy League question. But I agree the quality of play would be reduced. And I think there is a materially different level of quality that you are estimating by lumping Nick Pagliuca and Ryan Kelly into the same sentence, one a walk-on the other an NBA player. Why would there be enough Ryan Kelly's to keep things interesting? If Ryan Kelly, the consensus #14 recruit in 2009 and 48th pick in the 2013 NBA Draft, found college basketball an attractive route to develop his presumably best money-earning skill despite either (a) not receiving a scholarship or (b) receiving less resources in the form of coaching / gyms / etc, I'd be pretty surprised. It's possible there would be some Ryan Kelly's that chose college in this new hypothetical you describe. But I can't agree that it would be "enough to keep it interesting."

So, in my eyes, we're back to Nick Pagliuca. And yes, I think that would materially affect fan interest. Why? Because the allure of college basketball, to me and probably others, is a sweet spot. It's the intersection of reminiscence (for your college), nostalgia (for your younger days, perhaps playing a sport), excitement (of enjoying the actual sport), familiarity (of a product you've followed for many years, like I have and many of us on the board have), fandom (being part of a loyal group), relatability (for understanding that these are not professionals that are so incredible at their sport that it's nearly unbelievable), following (beginning to follow a player through the maturation process from teenager to adult to (sometimes) professional adult and following them through their career progression and throughout their life), and many other factors. If you give me Nick Pagliuca's on the court, I lose excitement because the sport is certainly less impressive and enjoyable when played at a lower level. I lose familiarity because you've altered my understanding of the product. I lose following because they ain't going professional anymore. And as a result of these, I will highly likely lose some of the group of fans and run the risk of losing fandom. I don't think you maintain enough of the key tenets that fan interest would stay substantially the same. I'd go so far as to say I don't think fan interest would be even close. Of course, your mileage may vary and your reasons for following college sports may be different. But I think the gist of my point holds across most mileages.

So, in summary, I enjoy your posts. Keep 'em coming. At least for me. The legal battle is an interesting one to me, as was conference realignment. Deep topics with a labyrinth of complexity to navigate through. That said, if where you were going in your line of questioning was that we may have some ideas here that could, to some extent, "solve" the problem, well I am clearly not seeing it.

- Chillin

[crimsondevil]

My point is this: people say that there's plenty of athletic revenue out of which the $5,000/person can be paid. The university counters that by claiming that after subtracting the athletic expenses from the athletic revenue there's really nothing left, so the $5,000 can't be paid out of athletic revenues. The question is whether this is true or whether they have "padded" the athletic expenses to make it seem like they have already used up all the athletic revenues, or whether they have paid the coaching staff more than was necessary, giving the appearance that all the athletic revenue has already been used up.

Again, there may be a lot of revenue (for some schools), but there isn't any "leftover" money - it all gets spent, by definition, as a non-profit organization. To spend money on something either requires a new source of funds or cutting something else. I don't agree with Richard Berg's conclusions, but he's absolutely right to say it's really about priorities.

Universities don't use profit/loss accounting like for-profit entities do. But a for-profit entity, in order to determine whether a division of the company is profitable, will take the revenues of the division and subtract from them the expenses necessary to generate that revenue. MBB athletes might say the same thing. Take the basketball revenue and subtract the expenses necessary to generate that revenue (coach's salaries, gym maintenance, etc.) After you have done that, is there enough left to create a trust fund for the MBB athletes? If so, then they would say that we have enough revenue to do so and that it is appropriate to do so since that was an expense necessary to generate that revenue.

As you said, universities don't use profit/loss accounting. So why should they do this for revenue sports? Athletic departments do not suddenly become for-profit entities because they choose to pay players.

As far as the pot of gold from which we are going to fund archery, they would ask why we even have archery, and what claim archery has on MBB revenue. Why does archery have a claim on MBB revenue but the expenses of the chemistry lab are not a claim on MBB revenue? From what pot of gold are we going to fund the chemistry lab?

Why does archery NOT have a claim on MBB revenue? Chemistry could as well, for that matter, but archery is part of the same unit, the athletic department, so its claim is somewhat better, organizationally if not morally. Why is the revenue from basketball and football sancrosanct that it needs to be kept within the same team? This just makes no sense to me.

As people have said, there is no pot of gold to fund this, so it comes from something else. I agree with others who think wrestling, track, etc. are likely targets.

If that fund is limited then we need to decide our priorities and determine whether we want to have a chemistry lab or an archery team or pay the players.

FIFY

[sagegrouse]

Again, there may be a lot of revenue (for some schools), but there isn't any "leftover" money - it all gets spent, by definition, as a non-profit organization. To spend money on something either requires a new source of funds or cutting something else. I don't agree with Richard Berg's conclusions, but he's absolutely right to say it's really about priorities.



As you said, universities don't use profit/loss accounting. So why should they do this for revenue sports? Athletic departments do not suddenly become for-profit entities because they choose to pay players.



Why does archery NOT have a claim on MBB revenue? Chemistry could as well, for that matter, but archery is part of the same unit, the athletic department, so its claim is somewhat better, organizationally if not morally. Why is the revenue from basketball and football sancrosanct that it needs to be kept within the same team? This just makes no sense to me.

As people have said, there is no pot of gold to fund this, so it comes from something else. I agree with others who think wrestling, track, etc. are likely targets.

FIFY

I haven't followed this subthread closely, but surely we aren't arguing over whether major universities with large athletic budgets (>$50 M) can afford to pay $5,000 extra to 100 players (roughly football plus hoops scholarships)? It's one percent or less of the budgets, and the management reserves are bigger than that for entities that large. Moreover, you can probably raise a bit more money given the intended use (directly to the players).

I think complaints from the bigger schools are cases of "crying wolf." For schools with much smaller budgets -- Furman, Citadel, SC State, Presbyterian, Wofford -- that's another matter entirely.