BTN, DirecTV, ND and Greed, Pt. 3

In Part 1 of this series I talked about the Big Ten Network and the deals it has set up with DirecTV and Comcast, among others.  I discussed how it wasn't necessarily all that important at this juncture if even half the people subscribing to packages carrying the BTN were fans of the Big Ten Conference at all. 

In Part 2 I talked at length about Notre Dame; what they mean to the Big Ten's expansion plans, why they don't necessarily want to join, and why it might be a good idea for them to do so anyway.

I'm wrapping this series up now by talking about greed and just how much it plays into the entire expansion idea.

I also wrote an article back on May 1st about how I thought expansion was a foregone conclusion and that the only question left was how big the Big Ten would go.  One of the comments struck home with me, as I've seen the same sentiment echoed across the web.

"Take! Take! Take! That's all I hear from the greedy (deleted) of the BT school saying...Greed, selfishness! Who gives a rats behind if several conferences are demolished and a whole bunch of fine schools are left without a home just as long as a few greedy schools get more money! Is that College Sports has become?....take what you want and to *ell with everyone else?" - Ken Mills

I can completely understand this thought process.  For the majority of us in the U.S. that fill up the middle and lower economic classes, it seems a little absurd that a conference that reportedly paid all of its members in excess of $20 million last year, would be looking to add to that total. 

Not only that, but they may be looking to add more than mere pocket change to their purses.  As many have speculated (myself included) the Big Ten may be looking to add up to five teams, destabilize the Big East, woo Notre Dame, and change college football forever.  All of this, on the surface, is being done for the purpose of getting the Big Ten Network into many, many more homes than it currently is. 

While I don't necessarily agree that money is the only reason for the Big Ten to be making their next growth spurt, it is undoubtedly among the very top reasons for doing so. 

Does that make Jim Delany and his Big Ten constituents "greedy"? 

Education could still be at the heart of it

I won't pretend to know what Jim Delany thinks on any given day, or about any given subject (previous articles to the contrary).  For all I know, he sits at home at night wondering what kind bonus he can ask for at his next performance evaluation.  There's a chance he's a text book narcissist who's simply on a power trip, playing chess with one of the nation's largest conferences.  I really don't know.

Before jumping to conclusions there are a few things to consider first.

Education is expensive for everyone

Here's a quick look at just a few of the programs offered by Ohio State, Iowa, and Notre Dame.

OSU

Biophysics

Chemical Engineering

Industrial, Interior and Visual Communication Design

Molecular Genetics

Neuroscience

Nuclear Engineering

Iowa

Free Radical and Radiation Biology

Genetics

Human Toxicology

Molecular Physiology and Biophysics

Neuroscience

Notre Dame

Aerospace and Mechanical Engineering

Biochemistry

Bioengineering

Chemical and Bio-molecular Engineering

Chemistry

Again, those are just a few of the many programs offered by each school, and those are only three schools (and I'm not trying to insinuate anything by putting Notre Dame in that list).

Let me ask you something.  How much do you suppose a Ti-Sapphire single photon counting time correlated fluoroscope costs?  How about an electrophoresis unit?  What about a 5kW Microwave Fixation System?

The first is used in biochemistry.  The second in radiation biology, and the third in neuroscience - each a program offered by the programs above. 

Considering that a new home laptop costs anywhere from $600 to $1500 (for a decent to good one), I can only imagine what a single photon counting time correlated fluoroscope costs.  It wouldn't surprise me if the thing costs the entirety of the money collected by Ohio State from the Big Ten in 2009. 

The goal of any institution of higher learning is to prepare their students for the career paths they've chosen.  To best accomplish that goal, colleges and universities have to stay abreast of the latest innovations so that their students can as well.  That means spending tons of money on the latest equipment that's entering the fields their students intend to join.

That goes for every single graduate and undergraduate program offered.  Some programs may not use such high-tech equipment and may not cost nearly as much.  Enough of them do though, to make providing a great education one very expensive endeavor. 

Things are upgrading at the speed of thought

Back in 1996, I bought my first home computer.  It was an ugly desktop that had 8MB of RAM and barely a Gigabyte of hard drive space.  It ran on a Windows 3.1 operating system and had a CD-Rom, plus a 3.1 inch floppy drive (which was never "floppy", unlike the original real floppy drives of the '80's).  Back then, it was top-of-the-line.

My good friend sold that computer to me (he operated a RadioShack franchise) and I remember him telling me with a smirk on his face about a new computer on the market that had 16MB RAM and over 2GB of hard drive space.  "What on earth would anyone need with more than one gig of hard drive?" he'd said.

Just a couple of years later, computers were operating on Windows 98, were storing 32MB of RAM and had hard drives over 4GB.  It seemed like every year would bring another generation of computers would come out that were twice as powerful, twice as fast, and had twice as much memory. 

Now, less than fifteen years later, I'm sitting here on a laptop that operates on Windows XP (I've avoided Vista), has a Gigabyte of RAM and 60GB of hard drive space - and it's old and outdated.  In the three plus year's I've owned this thing, newer, faster, and better machines have left it in the dust.

Those highly expensive pieces of equipment I talked about earlier aren't much different.  They may not have newer models every single year that make the old ones look like child's play, but they don't last forever either.  They need replacing every now and again.

There's more

Each of the schools in the Big Ten offers scholarships for virtually every sport they participate in.  The University of Iowa has no fewer than 20 athletic programs.  Ohio State has nearly 40.

The Big Ten provides approximately $100 million in financial aid to nearly 8500 student athletes. 

That doesn't include the students that receive academic scholarships, art scholarships, band scholarships, etc. 

None of that takes into account the cost of hiring a competent staff.  We pay our teachers too little - even our college professors - but it still costs the university to have them on staff. If they want people who are up-to-date with the latest information, they have to pay to find them, keep them, and keep them up-to-date.

It costs to pay the people that mow the lawns and fix the furnaces.  It costs for the people that fix the food in the cafeteria(s).  It costs to keep rooms and buildings painted and looking nice.  It costs to employ security to keep their students safe. 

Of course, it costs (a lot in some cases) to hire good coaches and athletic staffs to make their programs competitive and keep them in the public eye.  Consider that Iowa paid nearly 10% of the money they received from the Big Ten last year in salary for head football coach Kirk Ferentz.  Having the best doesn't come cheaply. 

That's something that can't be overlooked in all of this.  All of the schools within the Big Ten (as well as those being targeted for expansion) are very good institutions.  Putting together what they've accomplished, both on the fields of athletics as well as in the classrooms, takes a lot of cash. 

Of course there are many streams of revenue leading into the greater river that is a college budget.  Alumni and boosters donate on a yearly basis, there are grants, and tax money comes in from the government (for public schools, at least).  Of course, there is also the tuition paid by the students themselves (or their parents, or via student loans).

It doesn't change the fact that schools can do more with more money.  Not all of what they "do" is centered around making their sports better, or padding the administration's pockets.  A lot of the money that comes in from sports is funneled into the classroom by providing better facilities and equipment for their students to learn.

That's why schools focus so heavily on sports like football and basketball.  It's why they spend the big bucks to get great coaches and work so hard to get their teams showcased on television.  Getting that exposure helps them get more money and helps them recruit more students.

Getting that money gives them more to work with to provide the best learning environment possible for their students.

It's Delany's Job

We sometimes forget that James Delany is the Commissioner of the Big Ten Athletic Conference.  He's not the chancellor of a school.  He's not a professor.  He cares about the education of the students attending the schools within his conference, but minding their education isn't his job - providing the funds for that education is.

Yes, there's a lot more to his job than just thinking of ways to make the conference money.  Certainly, he plays a roll in the monitoring of schools' graduation rates and conduct of their athletes (or the schools' handling of misconduct).  He needs to make sure that every member institution is maintaining the standard set forth for them.

As a conference though, the Big Ten looks to Delany to manage it.  They expect him to constantly think of ways to make the conference better, stronger, and more visible to prospective students.  It's his job to make sure the conference is financially stable, and that people see how wonderful the schools are.  He's a marketer for the conference.

His job is to think of ways to make it better.  If that means adding a school, his job is to analyze the candidates, make a recommendation, extend an offer, and manage the negotiations. The Big Ten Conference isn't "The Big Ten Educational Conference".  Neither is the SEC, ACC, Pac-10, or any other conference in America.  The conferences are aligned for sports - and they often share some academic resources as well.

Does it make him greedy that he wants to make the conference bigger and expand the conference's exposure?  Not in my opinion.  Remember, he can't really do anything expansion-wise without the approval of the school presidents.  He's the commissioner, but they're the ones that have the final vote.  If they think he's going too far with his recommendations, they'll be sure to let him know.

Whatever happens though, it should be remembered that Delany is trying to do the best thing for his conference.  If doing so upsets people outside of that conference, it's really not his problem.  When business gets as big as college athletics are, you don't move up the ladder (or secure your place near the top) without ruffling some feathers and stepping on some toes. 

How far is too far?

That's the line that Delany and the Big Ten has to walk along.  At what point do they reach the point of negative return? 

Greed is defined as "excessive...desire, especially for wealth or possession".  What constitutes "excessive"?  Would adding one team to the conference be excessive?  What about three?  Five? 

It's subjective, and that's something Delany will have to figure out.  At some point, the Big Ten Network will reach a saturation point that it can't maintain.  At some point, the money won't continue to grow and the returns to the schools will begin to diminish.  That won't set well with the school presidents and athletic directors.

At the same time, getting too big too fast might leave a bitter taste in the mouths of fans whose favorite conference is negatively affected by the maneuver (see Mr. Mills' comments above).  While (as I said) it's not Delany's priority to worry about the fans of other conferences, it is important not to create too much of a negative image of the conference and potentially lose future students.

He and the school presidents have to figure out exactly how far they can go to extend their exposure, increase their revenues, and bolster their competitive edge without going too far.

If they go too far, then I would agree that they were greedy.  The problem is, I don't have all of the data they have.  I would venture that neither do you.  They hired William Blair & Company to help them figure all of this out and have gotten their report. 

What we don't know is exactly who that firm was looking at, how many they were expecting the conference to add, or over what time period this was all going to take place.  Only the people at the center of this whole thing know that.  It's important information because without it, all we can do is speculate on what the conference will do and why. 

Maybe you're right

To wrap this entire piece up, I'll level a concession.  Maybe those who believe that the entire expansion process is entirely about how much money can be made, are right.  Maybe the only reason Notre Dame's name has been mentioned is because of their national following that Delany thinks will bring more viewers to the BTN.  Maybe he's a greedy (deleted) and doesn't care about anything other than money and power.

Maybe you're also right that New York/New Jersey is a dead area to college athletics.  

Maybe all of this talk is just to get Notre Dame on board, in some sick and twisted ego trip.  Maybe it's payback for being left at the alter in 1999. 

I don't think it's nearly as simple as any of that. 

I think there is a lot of money to be made.  I happen to also think that making all of that money ultimately helps a lot of young people who might not be able to afford the kind of education they'll get.  I think making all of that money will help the schools of the Big Ten provide even better equipment and materials for their students to "get edumacated on". 

I think Notre Dame needs to give this whole expansion debate a lot of serious thought.  The Big Ten doesn't need them, but I think the Big Ten still wants them, and there might be a partnership in there that could be very good for the Irish.  I also respect where they're coming from and wish them well if they're not part of the Big Ten's future.

Ultimately, I don't think Delany, or the Big Ten schools, are quite as greedy as some are calling them.  Providing a quality education is expensive and growing even more expensive with every day.  These schools want to be among the best in the nation with every aspect of their institutions.  Money helps that happen.

One final thought that I want to leave you with.  If your conference could increase its revenue sharing by millions per school, could potentially increase its competitive product, and could bolster the academic atmosphere for all involved; would you consider it "greedy"?  What if doing so meant that they might consider expanding by as many as five or six schools?  What if doing that meant that another conference might cease to exist?  Would it be different if your favorite programs were the beneficiaries?

The Big Ten is going to do what is ultimately best for it.  That's why it's together as a conference.  That's why all conferences exist.  With all respect to other conferences and institutions, the duty of the Big Ten is to create the best possible situations for its schools. 

Would you expect anything different?