FanPost

Continuing the discussion on the B1G vs other conferences

There was a discussion that started yesterday in the B1G investigation post about whether or not PSU would be better off in a different conference, specifically the ACC. I dug up some numbers from this source to highlight the revenue discrepancies between the B1G and the ACC.

Based on the numbers in that article, on a per school basis and based on 12 teams in each conference (not counting Pitt and the Cuse yet), each ACC school receives about $13 million per year, and each B1G school receives $20-$24 million. The numbers at the table at the bottom of the article are a bit inconsistent with the text as the B1Gs numbers don't get that high in the table, but I've seen reported elsewhere that the B1G's numbers are north of $20 million. Regular readers of Frank the Tank's blog will note that he has calculated B1G revenues to be so far and away larger than anyone else's that they actually put Notre Dame third in it's own state in terms of TV revenue. I think a reasonable assumption is that a move to the ACC would be about a $10 million hit annually.

The Nittany Lion Club in its annual report cites an annual athletic budget of $107 million, of which $94 million goes to pay sport related expenses and the rest is used to fund new athletic facilities. This means a switch to the ACC would knock about a 10% hole in the budget, which is hardly insignificant. Football expenses are around $16 million, basketball expenses are a bit under $5 million combined men's and women's, and the rest of the sports are around $11 million. The rest of the money goes to things like facilities operations, scholarships, administration, academic support etc.

Now, it would be nice if that deficit could be made up with a little "belt tightening" but I don't think it's unreasonable to assume the PSU already operates as efficiently as it can. To make up a deficit like that requires either increased revenue or decreased costs. The simple options are:

1) Start using tuition and taxpayer dollars from the general fund on athletics. I really don't think that a school which is trying to re-emphasize its academic brand wants to go there.

2) Cut sports, or cut support for those sports such as scholarships, coaching salaries, or new facility construction.

3) Increase revenue. Now it would be nice to think that the ACC's contracts would go up and that the proposed ACC network would bring increased revenue, but this is a major business decision based on a whole lot of hope compared to the bird-in-hand B1G revenue base. The only concrete way to raise revenue would be to either increase donation levels or increase football ticket prices. Football revenues are around $49 million a year from ticket sales, and the NLC revenues are about $14 million. Making up the deficit through tickets requires a 20% increase in ticket revenue, or a 70% increase in NLC donation revenue, or some combination of the two.

So that's the framework under which Penn State athletics operates. My armchair athletic director opinion is that all three options are quite unpalatable just to feel more chummy in another conference, but hopefully this outline will help clarify some things for the sake of conversation.

You created a Fanpost! Any content from a premium site that requires a subscription will be deleted once we catch wind of it. If you simply want to share a link, quote, or video, please consider using Fanshots instead. Thanks.

X
Log In Sign Up

forgot?
Log In Sign Up

Forgot password?

We'll email you a reset link.

If you signed up using a 3rd party account like Facebook or Twitter, please login with it instead.

Forgot password?

Try another email?

Almost done,

Join Black Shoe Diaries

You must be a member of Black Shoe Diaries to participate.

We have our own Community Guidelines at Black Shoe Diaries. You should read them.

Join Black Shoe Diaries

You must be a member of Black Shoe Diaries to participate.

We have our own Community Guidelines at Black Shoe Diaries. You should read them.

Spinner

Authenticating

Great!

Choose an available username to complete sign up.

In order to provide our users with a better overall experience, we ask for more information from Facebook when using it to login so that we can learn more about our audience and provide you with the best possible experience. We do not store specific user data and the sharing of it is not required to login with Facebook.

tracking_pixel_9347_tracker