The National Collegiate Athletic Association exists to run tournaments. That is what most journalists will say. The policies that the organization puts out are often broken, with little or no punishments handed out by the governing body.
But that doesn’t mean the NCAA is totally useless to college sports. The odds to win March Madness are a lot larger now than if they were to expand the field, as the rumors and conversations are circulating about the idea.
The NCAA is actually smart as a business. The organization runs the March Madness tournaments – one men’s event and another women’s event – and stands to profit $900 million yearly. That is enough to fund most college athletics for the full calendar year.
Expanding, of course, would lead to a larger pot of gold that the NCAA would split amongst its member institutions. As each team wins and advances in the tournament, it earns an additional share of the money that will be split among its conference institutions.
That is what allows coaches and administrators to earn bonuses, hire and fire coaches with ease and quickly build up new facilities and renovate existing ones. It is what fuels the arms race among the different athletic departments to build bigger, flashier facilities to woo recruits to their schools.
But There Was a Hold Out
The NCAA, for so long, did not allow the players to have a share in making money. While they aren’t employees because they are getting an education – though not every sport offers full scholarships or has enough money to distribute those to each player. Not until name, image, and likeness were developed were these players able to make money above the table.
Of course, there were recruiting scandals, and a lot of money was being exchanged under the table. But now, it is legal for players to profit off of who they are. That means players who hit miraculous shots can use those moments to create merchandise and commercials and make money off of their heroics.
It is bizarre that the NCAA held out so long on this development. What is next is the possibility of revenue shares going to players, though that has more to do with the college football bowl industry and its playoff expansion to ensure players play instead of opting out.
Show Me the Money!
Most of the NCAA’s wealth comes from a lucrative television contract with CBS. The broadcast company, which also owns TNT, TBS, and TruTV, is the sole broadcaster for the NCAA games and is strict on those who are streaming them illegally.
The broadcast company has plenty to gain, too, from the ad revenue it generates. It is a lucrative deal for both sides. Now the television rights will be up for bid again, and that is when the tournament could next expand. If the NCAA and its members deem it worth it by market research, that could raise the price and bring in other media players such as ESPN and FOX.
Worthwhile to Host
The tournament organizers will select host cities years in advance. It is a fairly lucrative ordeal for the host cities because of the four to eight teams who are visiting and bringing fans. Those who host the first two rounds will get eight teams in town, and then four will stay. Beyond that, it is four teams until the championship game leaves two left.
Dayton is always a host for the first four games, which features eight teams in a two-day stretch to get the field from the expanded 68 teams down to the 64-team bracket.
Bigger cities near college towns will host the first and second rounds. Often, those are in NBA arenas that get packed into venues that can accommodate 17,000 to 22,000 fans. The regionals will occasionally be played in larger venues like football stadiums, which has been customary for the Final Four.
But it is not just about ticket sales. There are hotels that have to host teams, media people, and thousands of fans who visit. Restaurants, particularly around the arenas and stadiums, will benefit from the foot traffic, as will the bars and other entertainment such as museums, aquariums, and other places to entertain fans on off days.
March Madness is indeed a great business.