If you’re looking to do a little last minute holiday shopping for a college football fan who’s a bit cynical about the business side of the sport, here’s a recommendation.
At Texas, Michigan, Auburn, Alabama, Georgia, Florida, Penn State, Notre Dame, Louisiana State University and Arkansas, revenues have increased to $762 million from $229 million from 1999 to 2012. That is a whopping 233 percent increase. Mr. Gaul observes that during this period “profit margins had ballooned to hedge-fund levels,” generated by television broadcast rights, luxury suites, seat donations and corporate advertising. Mr. Gaul reports that the big universities “have netted 90 percent of all the new money that has flowed into college football the last decade or two.”
… Meanwhile, the bank vaults remain open and the money is pouring in. No one Mr. Gaul spoke with seemed concerned with whether this incredible growth might be a bubble. He said that when he asked that question of the commissioners of the Big Ten and the Pacific-12, “they only laughed in response.” Until proven otherwise, they and others will do as the former Texas athletic director DeLoss Dodds suggested: “Football is the train. You ride it for all it’s worth.”