Miller: With exorbitant CFP payouts, money isn’t the limiting factor in paying college athletes

Jan. 11, 2016, 1:44 a.m.

There will only be one winner on the field in tonight’s College Football Playoff (CFP) Championship Game between Clemson and Alabama, but every FBS program will count Monday night as a financial victory.

That’s because each of the 10 conferences in the top level of Division I football receive payouts from the CFP — regardless of whether or not one of their member institutions is a participant. According to the CFP’s Revenue Distribution schedule, each of the Power Five conferences (Pac-12, Big 12, Big Ten, SEC and ACC) will receive about $51 million, with conferences whose teams were selected for semifinal games slated to earn another $6 million each. In addition, schools like Stanford who played in out-of-rotation New Year’s Six games (in 2015-16: Rose, Peach, Sugar and Fiesta Bowls) earn $4 million for their conferences.

With academic bonuses and expense waivers, these conferences could pull in close to $60 million from the CFP this year. Administrators are free to distribute this money how they choose, but it is usually distributed evenly among the conference’s membership. For instance, when Oregon was a final four team last season, the Pac-12 divided the CFP’s payout evenly among the 12 institutions, meaning the Ducks received just as much as lowly Oregon State and Colorado. If that doesn’t seem quite fair to you, rest assured that such socialistic schemes are done in the name of “leveling the playing field” (which, as demonstrated by the uncompetitive slate of New Year’s Six bowls, hasn’t really worked out all that well).

Furthermore, the other five conferences in the FBS — the Group of Five — will share close to $80 million. Yes, even the veritable powerhouses that are Appalachian State, Utah State, Miami-Ohio, UTEP and SMU will open a check from the CFP. Even some FCS schools will share in the bounty of the playoff. In all, over $500 million in bowl money was distributed to conferences and schools last year, a nearly $200 million jump from the last year of the BCS era.

The principal driver of this revenue is the massive media rights deal the CFP negotiated with ESPN in late 2012. The agreement calls for ESPN to pay $608 million per year through 2025 for the right to broadcast the seven games (New Year’s Six plus championship game). That’s more than $7 billion by the time the deal expires in 2025. Seven. Billion. Dollars. And let’s not even start with the NCAA’s deal for March Madness.

With riches like this, it makes excuses like “but there’s no money to pay players!” even more laughable. Do not be deceived by the Orwellian-style doublespeak of NCAA, conference and school administrators: There is money, plenty of money, to directly pay the athletes that create the value reflected in gargantuan media rights agreements. The powers at bay simply refuse to do so — illegally, as it turns out. Indeed, they’ve colluded with one another to cap “student-athlete” compensation and so must compete for their services via secondary goods, like facilities and coaches.

Of course, a portion of the money does trickle down to the players in the form of enhanced nutrition plans, academic tutoring and mini-golf courses in the team facility, but it does so inefficiently. The value of professional coaching staffs and palatial team headquarters are artificially inflated due to schools’ inability to directly compensate their athletes above the level of the their scholarship and cost of attendance. That is, if institutions were permitted to pay players, there would likely be a commensurate decrease in spending on coaching salaries (Championship Game head coaches Nick Saban and Dabo Swinney will make close to $10 million combined this season) and facility construction.

But don’t burden your mind with thoughts of income redistribution, economic inefficiencies and blatant antitrust violations. Enjoy the game tonight.

 

Commiserate with Cameron Miller over the injustice of a Sith Lord such as Nick Saban getting paid millions of dollars while his athletes can’t paid anything at cmiller6 ‘at’ stanford.edu.

Cameron Miller is a sports desk editor for The Stanford Daily's Vol. 246 and is the men's and women's golf writer. He also writes on NCAA-related matters. Cameron is also a Stanford student-athlete, competing on the cross country and track and field teams. He is originally from Bakersfield, California, but spends most of his time away from the Farm on the state's Central Coast. Contact him at [email protected].

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