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NCAA College Sports Are Big Revenue Earners, Business and Industry Trends Analysis

American universities that are members of the National Collegiate Athletic Association (NCAA) can bring in very lucrative revenues, particularly if that have top football teams.  Of the top ten schools by football revenues for 2022, Ohio State led the pack with $251.6 million in total revenue, followed by the University of Texas with $239.3 million, Alabama with $214.4 million and Michigan with $210.7 million, according to the NCAA.
Growth in television rights helps to fund the largest university sports programs, such as lucrative agreements between NCAA conferences (like the SEC and PAC-12) and major broadcasters.  For example, in mid-2022, Fox, CBS and ESPN signed a deal with the Big Ten conference to televise football games for more than $7 billion from July 1, 2023, through the end of the 2029-30 athletic year.  The deal’s payout will be between $80 million and $100 million per school per year.  Also, major media agreements are in place between broadcasters and the NCAA for rights to air each year’s extremely popular college bowl football playoffs and championships, and for a wide range of other events. 
The University of Texas created the Longhorn Network in August 2011, the first sports cable TV network devoted exclusively to athletics at one school.  The network is backed by a 20-year deal worth $300 million, and is a partnership between the University, ESPN (owned by Walt Disney) and IMG College, a division of IMG Worldwide, a global sports and media company. 
The big revenue-producing sports are football and, at a distant second, men’s’ basketball.  OSKR calculated data for the New York Times, based on information from the U.S. Department of Education, that found that football (including donations and other revenue sources), brings in at least 65% of total revenue at major athletic programs.  In effect, revenue generated by football and men’s basketball helps subsidize another 18 sports played on the college level.  In addition to ticket revenues and booster and alumni club dues, many schools attract multimillion-dollar endowments and donations from alumni and other supporters who are sports fans.
Huge budgets fund top salaries for winning coaches as well as state of the art athletics facilities.  As of early 2023, the highest paid coach was the University of Alabama’s Nick Sabin, who earns $10.9 million in salary for running the football program.  Clemson’s Dabo Swinney was second ($10.54 million) followed by Georgia’s Kirby Smart ($10.25 million).  Even coaches for less popular sports are paid well at the largest schools, such as the $250,000 per year paid to a coach for a softball program.
The NCAA includes more than 1,000 members, each categorized into one of three divisions.  Division I teams, for example, are required to sponsor at least seven sports for men and seven for women (or six for men and eight for women).  Several other regulations and requirements must be met at various Division levels.  Sports involved range from bowling and fencing to field hockey, golf, gymnastics, wrestling and more.  The NCAA itself, operating on behalf of its member universities, had fiscal 2022 revenue of $1.14 billion.  That revenue was generated primarily by television and marketing rights fee, with the balance generated by the annual championships, investments and membership fees.
There is a great divide between the largest conferences, such as the Southeastern (SEC) and the Big 12, and the smaller conferences.  Schools in the big conferences typically have much higher television ratings and earn far greater revenue, sometimes inconsistent with performance.  That kind of power may set the top conferences above NCAA restrictions on operations, such as limits on scholarships, the use of agents and advisors and limits on the amount of contact allowed with top athlete prospects.


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