Sport and study in the USA - 'Life Changing Experience’ - Blog Paul #fromtheboardroom

The tension of financial trade-off in American college sports


By Paul de Koning, director KingsTalent

Paul de Koning

 

 

 

 

 

There are few countries where sports play as big a role as they do in the USA. The country is sports crazy. The popularity of sports doesn’t limit itself to the professional divisions but college sports are also immensely popular. A college football match between Oregon and Michigan attracted 109.000 supporters last month. That’s more than a sold out Camp Nou in Barcelona!

 

OREGON Stadium

  • Oregon Stadium

 

This huge popularity comes from the important role that colleges and universities play in their (regional) environment. When you study at a college you don’t just study there, you are part of a history / legacy. Americans associate themselves with sports. Environment, students and alumni are proud to be (or have been) a part of this history and therefore supporter for life.

As said college sports are immensely popular and the stepping stone to the professional leagues; NFL, NHL, MLB and MLS. College sports and with it the most important college sports association NCAA along with the universities and colleges have made important steps towards professionalization over the last few years. The quality and level of play, the top sport guidance both on academic as on athletic level, technical resources, facilities, training camps and so on are exceptional to say the least. Many professional soccer clubs from The Netherlands shrink in comparison to these universities. This is not at all strange if we take a look at their revenues.

In comparison – Oregon has a yearly sports revenue which exceeds the total budgets of Dutch top professional soccer clubs AJAX (65 million), PSV (62 million) and Feyenoord (35 million) together!

 

College Revenues

  • NCAA D1 Top 10 universities based on sports revenues.

 

In 2014 207 NCAA D1 universities were raking in more than $10.000.000.000 (!) in revenues from college sports. More than 20 schools total an individual sports revenue over $100.000.000, 66 schools total an individual sports revenue over $40.000.000.

Based on the numbers above one can say that American universities have made a giant leap forwards over the last ten years, with most of them doubling their sports revenues. College sports have been adopted by American multinationals / sponsors and sports networks. The exponential growth in sports revenues is mostly due to the increases popularity of the big college sports like American Football, Baseball and Basketball.

Jim Harbaugh

  • Jim Harbaugh, Michigan Football, head coach

 

Not only schools profited from this growth. Coaches have also seen an increase in income. The salaries of the American Football coaches of the top-10 universities have more than doubled! The best paid college sports coach Jim Harbaugh (American Football, Michigan) earns with $ 7.000.000 a year (bonuses not included) almost three times as much as Joachim Low, coach of the world-champion German national soccer team.

 

Coach Salary

  • *Salaries head coaches American Football (Bonuses not included).

 

Although there has been an exponential growth in the salaries of the head coaches in the last ten years, this can be leveled to the growth in revenues by the individual colleges. So this can be seen as fair. However, in college sports, one very important aspect is skewed. This aspect is the student-athlete, arguably the most important part of the game of college sports.

Student-athletes have a tough life. Important to say… As a student-athlete you are definitely a privileged person. Playing sports at the highest level, playing in packed stadiums, making great travels and seeing a lot of the USA. But there is a downside. These athletes are under great stress; weekly performing to a maximum in a packed stadium (>100.000 people), live ESPN media coverage in front of millions of viewers, full-on media attention that can be compared to a Champions League soccer match in Europe with pre- and postgame analyses where in-game mistakes will be publicly punished.

Even in Europe these college sports games are broadcasted live on Fox Sports. And where a professional athlete can use his/her entire focus on playing sports, the student-athlete is expected to use his/her off-time to study for the Math exams on Friday, thus not only dealing with the stress of performing on the field, but also dealing with the stress of getting their grades in school.

 

collegegameday

  • ESPN College Gameday

 

This is where the college sports association NCAA plays an important role. College sports in the USA are still played following the ‘amateur-principle’. In short this means that it’s not allowed for the schools to pay the student-athletes any salary or prize money. Where in The Netherlands even mediocre soccer players can be paid hundreds of thousands of Euro’s, this is not the case for even the most talented student-athlete. It is allowed for the schools to give out scholarships in which case student-athletes are being compensated for tuition fees, books and housing. These scholarships can go up to $50.000 a year, depending on the tuition fees and housing costs at individual universities.

The reason that the NCAA applies this amateur-principle is clear. A student-athlete at a college or university in the USA is a student first and an athlete second. The NCAA wants to avoid at all costs that playing college sports will go at the expense of the education of the student-athlete. So this amateur-principle is very understandable, but the question remains, isn’t this principle outdated by recent events?

 

The Ohio State band performs before the NCAA college football playoff championship game against Oregon Monday, Jan. 12, 2015, in Arlington, Texas. (AP Photo/Tony Gutierrez)

  • College Football Final, Oregon – Ohio State, @AT&T Stadium, Arlington Texas

 

The numbers above lead to a tension in the financial trade-off between the huge sports revenues from college sports by the universities and the rules by the NCAA under which college sports should be played, and where the amateur-principle is very important. The question remains whether the NCAA rules concerning the amateur-principle are outdated or not. Are student-athletes being exploited by there schools, by giving little and collecting huge yearly sports revenues? The NCAA will not be very eager to abolish one of it’s most important and oldest rules. On the other side public opinion and student-athletes will keep putting pressure on the NCAA to revise and update certain rules for college sports. Needless to say, the future of college sports is under great pressure.

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