- Dec 15, 2002
- 70,993
- 27,154
- 113
My first reaction was to laugh at this because Waco and Lubbock can both get sucked up their own assholes for all I care, but then I started thinking about it...Baylor just spent how many millions on that toilet bowl shrine on the Brazos, and now they've lost their biggest draw and potentially any level of tv money ever again.
Lubbock is a trade hub for west Texas, but the only time anyone ever went there was for sporting events. Tech's enrollment is 32k, but they've also had the front porch of Big 12 sports as a draw.
TCU doesn't really have to worry about cashflow overall, but their football and baseball programs are obviously buoyed by finally getting to join a real conference. Now, I'm just not sure there's much of a place for them in any conference of substance, ergo: Baylor.
For the record, all other reactions were to laugh as well, but I'm just not sure that replacing Texas, Kansas, and OU with North Texas, SMU, or Cougar High will do much to pay off their capital investments, esp if they are relegated to Tier 2-3 status. plus this was authored by none other than the Perryman Group guy.
By Ray Perryman
8:07 AM on Jul 28, 2021
The always interesting world of college athletics in Texas was rocked with the news that the University of Texas along with the University of Oklahoma would soon be leaving the Big 12 Conference. The immediate plan is to depart for the Southeastern Conference in 2025 when the current television contract expires.
In many ways, this move is not surprising and will undoubtedly bring benefits to UT and the Austin area. But those universities that get left behind in the conference realignment, and their hometowns, would suffer. Baylor University, TCU and Texas Tech are at risk of losing out, and, by my calculations, that could cost the Waco, Fort Worth and Lubbock economies over $500 million per year and thousands of jobs.
The outcome of the UT and OU move could change for a variety of reasons. For one, the move might not be approved by the SEC (a certain school in College Station is not exactly thrilled at the prospect, but doesn’t have the ability to single-handedly block it). On the other hand, the timing of new media deals could cause it to happen sooner or a better opportunity from another conference might come along. UT and OU have made it clear that they are prepared to adapt to a changing environment. One thing we can be sure of in a fluid situation is that these elite programs are not going to stay put.
College athletics, like the tectonic plates beneath us, is always shifting, normally at a somewhat glacial pace but with periodic jolts and accelerations. We have seen major realignments on multiple occasions. The ongoing ebb and flow were recently given a seismic shift with a Supreme Court ruling and resultant new NCAA rules allowing athletes to benefit financially from the use of their name, image and likeness.
There is certainly nothing inherently wrong with anyone being compensated for their skills and abilities (in fact, this concept drives much of the global economy). Nonetheless, this change, particularly when coupled with the prospects of massive new television contracts and an expanded playoff format, puts a premium on elite leagues and marquee matchups, fundamentally altering the field of play for collegiate sports.
Given the fact that universities with the highest levels of exposure to major media outlets are likely to offer athletes the best personal marketing opportunities, the premier athletes in all sports will naturally be drawn to them, even more than before. The next few years will no doubt bring notable changes, and, while much is not known at this point, it’s almost certain to include gravitation toward a smaller number of top-tier schools dominating the competitive landscape. A basic economic concept dating back to Aristotle is that you get what you incentivize.
It remains to be seen precisely what structure will ultimately evolve. After all, sports thrive on competition, and some parameters may be imposed to limit the degree of concentration (much like the function that antitrust laws perform in tempering market behavior). Such practices are common in professional sports, including salary caps, reserve clauses, and constraints on free agency. Similarly, the NCAA has long sought to level the playing field, implementing restrictions on the number of scholarships dating back to the early 1970s. The process will play itself out over time.
For now, however, schools with large alumni bases and high national profiles are going to have a decided advantage. A sophomore Alabama quarterback who has hardly played varsity ball is approaching seven figures in NIL deals, furthering the recruiting advantage of an already iconic team.
At the same time, the market for television rights is growing substantially but is finite at any point in time, and resources will be allocated based on what is expected to yield the best outcomes for networks and advertisers. That march will inevitably and inexorably be toward big markets, powerhouse programs, intense rivalries and elite players.
Against this background of evolution (and, at the moment, revolution) is the fact that two storied institutions have announced their intention to leave the Big 12 Conference. Texas is consistently ranked as one of the very highest schools in athletic revenue and OU is in the top 10. No other Big 12 school even ranks in the top 25. Without Texas and OU, the rest of the conference undoubtedly faces smaller television deals, lower attendance, and other negative consequences.
The action in college athletics, of course, is not limited to the field, court, diamond, pool or gym. It has profound implications in many arenas, including the economy. We can’t know exactly how things will look, and speculation is rampant. One proposal has been to merge the Pac 12 and the remainder of the Big 12 into a 20-team league (unlikely due to logistical, administrative, geographic and cultural barriers, but certainly not impossible).
Despite the uncertainty, it is worth considering some plausible outcomes and their implications. I recently trained my economic lens and models on this topic and can offer some reasonable assessments.
In particular, my firm recently estimated business losses to the remaining Big 12 communities based on the effects of:
1. Reductions in athletic department revenue that would be reflected in lower instructional and administrative services spending in these areas.
2. Direct tourism losses from lower spending at home games for food, lodging, travel and other activities.
Lubbock is a trade hub for west Texas, but the only time anyone ever went there was for sporting events. Tech's enrollment is 32k, but they've also had the front porch of Big 12 sports as a draw.
TCU doesn't really have to worry about cashflow overall, but their football and baseball programs are obviously buoyed by finally getting to join a real conference. Now, I'm just not sure there's much of a place for them in any conference of substance, ergo: Baylor.
For the record, all other reactions were to laugh as well, but I'm just not sure that replacing Texas, Kansas, and OU with North Texas, SMU, or Cougar High will do much to pay off their capital investments, esp if they are relegated to Tier 2-3 status. plus this was authored by none other than the Perryman Group guy.
A UT move to SEC could cost the Waco, Lubbock and Fort Worth economies $500M
The always interesting world of college athletics in Texas was rocked with the news that the University of Texas along with the University of Oklahoma would...
www.dallasnews.com
A UT move to SEC could cost the Waco, Lubbock and Fort Worth economies $500M
University communities that get left behind in the conference shake-up stand to lose economic heft and jobs.
By Ray Perryman
8:07 AM on Jul 28, 2021
The always interesting world of college athletics in Texas was rocked with the news that the University of Texas along with the University of Oklahoma would soon be leaving the Big 12 Conference. The immediate plan is to depart for the Southeastern Conference in 2025 when the current television contract expires.
In many ways, this move is not surprising and will undoubtedly bring benefits to UT and the Austin area. But those universities that get left behind in the conference realignment, and their hometowns, would suffer. Baylor University, TCU and Texas Tech are at risk of losing out, and, by my calculations, that could cost the Waco, Fort Worth and Lubbock economies over $500 million per year and thousands of jobs.
The outcome of the UT and OU move could change for a variety of reasons. For one, the move might not be approved by the SEC (a certain school in College Station is not exactly thrilled at the prospect, but doesn’t have the ability to single-handedly block it). On the other hand, the timing of new media deals could cause it to happen sooner or a better opportunity from another conference might come along. UT and OU have made it clear that they are prepared to adapt to a changing environment. One thing we can be sure of in a fluid situation is that these elite programs are not going to stay put.
College athletics, like the tectonic plates beneath us, is always shifting, normally at a somewhat glacial pace but with periodic jolts and accelerations. We have seen major realignments on multiple occasions. The ongoing ebb and flow were recently given a seismic shift with a Supreme Court ruling and resultant new NCAA rules allowing athletes to benefit financially from the use of their name, image and likeness.
There is certainly nothing inherently wrong with anyone being compensated for their skills and abilities (in fact, this concept drives much of the global economy). Nonetheless, this change, particularly when coupled with the prospects of massive new television contracts and an expanded playoff format, puts a premium on elite leagues and marquee matchups, fundamentally altering the field of play for collegiate sports.
Given the fact that universities with the highest levels of exposure to major media outlets are likely to offer athletes the best personal marketing opportunities, the premier athletes in all sports will naturally be drawn to them, even more than before. The next few years will no doubt bring notable changes, and, while much is not known at this point, it’s almost certain to include gravitation toward a smaller number of top-tier schools dominating the competitive landscape. A basic economic concept dating back to Aristotle is that you get what you incentivize.
It remains to be seen precisely what structure will ultimately evolve. After all, sports thrive on competition, and some parameters may be imposed to limit the degree of concentration (much like the function that antitrust laws perform in tempering market behavior). Such practices are common in professional sports, including salary caps, reserve clauses, and constraints on free agency. Similarly, the NCAA has long sought to level the playing field, implementing restrictions on the number of scholarships dating back to the early 1970s. The process will play itself out over time.
For now, however, schools with large alumni bases and high national profiles are going to have a decided advantage. A sophomore Alabama quarterback who has hardly played varsity ball is approaching seven figures in NIL deals, furthering the recruiting advantage of an already iconic team.
At the same time, the market for television rights is growing substantially but is finite at any point in time, and resources will be allocated based on what is expected to yield the best outcomes for networks and advertisers. That march will inevitably and inexorably be toward big markets, powerhouse programs, intense rivalries and elite players.
Against this background of evolution (and, at the moment, revolution) is the fact that two storied institutions have announced their intention to leave the Big 12 Conference. Texas is consistently ranked as one of the very highest schools in athletic revenue and OU is in the top 10. No other Big 12 school even ranks in the top 25. Without Texas and OU, the rest of the conference undoubtedly faces smaller television deals, lower attendance, and other negative consequences.
The action in college athletics, of course, is not limited to the field, court, diamond, pool or gym. It has profound implications in many arenas, including the economy. We can’t know exactly how things will look, and speculation is rampant. One proposal has been to merge the Pac 12 and the remainder of the Big 12 into a 20-team league (unlikely due to logistical, administrative, geographic and cultural barriers, but certainly not impossible).
Despite the uncertainty, it is worth considering some plausible outcomes and their implications. I recently trained my economic lens and models on this topic and can offer some reasonable assessments.
In particular, my firm recently estimated business losses to the remaining Big 12 communities based on the effects of:
1. Reductions in athletic department revenue that would be reflected in lower instructional and administrative services spending in these areas.
2. Direct tourism losses from lower spending at home games for food, lodging, travel and other activities.
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