mturn017
ODU Homer
Posts: 16,799
Joined: May 2012
Reputation: 1603
I Root For: Old Dominion
Location: Roanoke, VA
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RE: G5 Debt Mounting
(07-03-2018 02:09 PM)quo vadis Wrote: (07-03-2018 01:36 PM)mturn017 Wrote: (07-03-2018 01:01 PM)quo vadis Wrote: (07-03-2018 12:31 PM)panama Wrote: (07-03-2018 07:46 AM)quo vadis Wrote: But Ken-D's claim is too simplistic. Companies DO cut their marketing all the time, or shift marketing priorities from one aspect of the business to another, and if being in a particular market or product area becomes too costly, they will exit markets and cut product lines. They do it all the time, even successful companies.
Also, you have to remember that during the era Ken was talking about, costs were relatively low for everyone, as was revenue. And we're not talking ancient history here, but much more recently. E.g., in 1995, Baylor, a Power school, had a total athletic budget of $7.5 million. That same year, Florida and Nebraska, two powerhouses that played for the national title, had athletic budgets of $12m and $10m respectively.
So whatever budget a "Group" school like a Troy or North Texas had, we know it was no more than $7.5m less than Baylor or $10m less than Nebraska (make it $16m for Nebraska if you want to adjust for inflation). A "group" school didn't have to bust its budget or soak its students to stay within striking range. Not true any more.
Also, the mentality of 'group' schools has changed. Twenty years ago, most group-level schools were satisfied with trying to make it at that level. Precisely because there wasn't that much money to be made if you were truly big-time, there wasn't the incentive. An Eastern Kentucky was basically happy with its second-tier lot in life.
Now, though, it seems like half the 'group' schools have adopted an ambitious 'striver' mentality, they have a plan to boost themselves into the Power level. So as they have more ambitious goals, they are spending more at a time when the costs of keeping up are rising, no check that, the costs of keeping up are impossible, because as my Memphis example showed, you can't keep up when the state Power school is getting $40m from its conference each year and you are getting $2m. This is why it is more harmful to the rest of the university in a way it wasn't 20 years ago. Schools, particularly schools with no power history, are investing big resources chasing the Power dream. And they don't have the money to spend, by and large.
If my operating budget is $1B and I decide to pay $15M or $20M to take care of any deficit and the end result is more notoriety, more admission apps and enhanced prestige for the university, that isn't a bad tradeoff. The only ones upset are P5 fans whose schools did the same in the 1950s.
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But ... there's no evidence that there are any of those benefits. It's pretty astonishing, because universities are supposed to be citadels of scientific studies and the like, but nobody has shown that those benefits exist. Administrators just assert them.
And the reason for that is that these benefits probably don't exist, or to the extent they do, they are far less than the cost of generating them.
I have always suspected that the real reason schools make these bids to have 'big time' college athletics is because of administrator and wealthy donor egos. Admins and elite alums want to go on junkets to bowl games and they don't want to attend conferences and business meetings where peers from athletic powers are bragging about their school's big football or hoops team and they have to sit silent. Student behavior at such schools strongly supports this notion (e.g., empty stadiums).
It's very similar to situations where a mayor or city councillors support public financing of stadiums for pro sports teams. They talk about 'economic development'and status as a 'big time' city to justify soaking taxpayers, when research shows that the costs actually far outweigh the benefits.
The actual motivation is mayor and elite egos, they don't want elites in other cities to be able to wave their sports franchises in their face.
Of course they exist. 30 years ago Virginia Tech was athletic peers with VMI and anyone who wanted to go there was accepted. Not true today. I'm not saying that's all football but football was a HUGE impetus in allowing the transformation.
What's the evidence for that? VT's enrollment when Frank Beamer arrived in 1987 was about 25,000. Today, it's about 33,000. Very modest growth, in fact, VT's big enrollment boom came from the late 1960s to the mid-1980s.
And how can Old Dominion have experienced a big football impact? Honestly, very few are aware that ODU even has football.
VT is the size it wants to be. Check # of applications, percentage accepted and average SAT scores and I guarantee you can find the difference.
Maybe very few of the Trolls that live under your bridge are unaware that ODU has football but everyone in the greater Hampton Roads area and Eastern VA is well aware of it. Which is where we draw most of our students from. Do you think anyone outside of the greater Tampa area would be familiar with USF if it wasn't for sports? The answer is no. But that wasn't my point. ODU had very much a commuter vibe not long ago (and still there's a large number of commuting students and military that attend there) but it has a much greater campus feel now. It doesn't matter if BFE Ohio or Fla knows about ODU football, it's here and our community supports it.
(This post was last modified: 07-03-2018 02:48 PM by mturn017.)
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