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UB Athletics: UB fallen behind the ‘haves’

This is the last of five stories looking at the status of University at Buffalo athletics and their long-term potential.

By Bob DiCesare

News Staff Reporter

The idea that the University at Buffalo could position itself to go “big time” in college athletics carries some weight, at least in theory.

• UB is regarded as the flagship school in the New York State university system.

• It has held membership in the prestigious Association of American Universities since 1989 and is one of only three member schools, along with Rice and Tulane, that have Division I-A football programs but reside outside a major conference.

• The area’s population base is sizable compared with many other Division I-A college towns.

These are all pluses, and just a short time ago might have been considered significant pluses. They’re among the reasons Warde Manuel, a former Michigan football player and Wolverines athletic administrator, called UB a “sleeping giant” when he became athletic director in 2005. They’re among the reasons Danny White, Manuel’s replacement and a former athletic administrator at Mississippi, spoke of UB’s vast potential and its quest to become the nation’s next big-time athletic brand when he arrived in the summer of 2012.

But dramatic changes in the college landscape caused by the American traditions of Saturday football and good old-fashioned capitalism raise doubts whether what once seemed plausible in theory now qualifies as a practical pursuit.

Athletics revenues among the major conferences have risen at dizzying speed. The Pac-12, for instance, almost tripled its income from 2011 to 2013 to an astounding $334 million, according to its financial disclosures. And there’s still room for growth. That conference’s member institutions are projected to average $25-30 million apiece in annual television dollars under current network agreements.

The four other major conferences – the ACC, Big Ten, Big 12 and SEC – are either in the same yacht or expect to board it soon. The gap between the elite and the non-elite has widened considerably during a philosophical shift that has seen the Big Five emphasize business partnerships over geographical arrangements. For example, West Virginia’s jump from the Big East to the Big 12 makes Iowa State its nearest conference rival – at some 850 miles away.

The quest to maximize television dollars through football-generated appeal was behind the major conference expansions and the inter-conference migrations of the past few years. The ACC, Big 10, Pac-12 and SEC found strength in numbers while the Big 12, despite just 10 members, leveraged its value through the athletic behemoth that is the University of Texas. The Longhorns have their own TV network but share a percentage of revenues with their Big 12 family members.

Because television revenues have increased drastically, UB and other schools that may desire to join a major conference face barriers nonexistent just a few short years ago. They would have to bring substantial equity to the table, either in terms of media market or far-reaching prestige, two areas that could bolster conference revenues with national television networks and/or a conference-created network.

“I think that’s true. It’s very much revenue-driven,” said Kyle V. Sweitzer, a data research analyst in the office of planning and budgets at Michigan State who wrote the chapter “Institutional Ambitions and Athletic Conference Affiliation” for the journal “New Direction for Higher Education.”

“That’s exactly why the Big Ten added Maryland and Rutgers this year,” Sweitzer said. “If you look at their media markets, Rutgers is essentially New York City and northern Jersey, and Maryland brings in Baltimore, Washington, D.C., and Philadelphia really. I think that that’s exactly the reason for the Big Ten to bring those two schools in.”

Buffalo faced similar scrutiny from Major League Baseball during the expansion race of the early 1990s. Prospective owner Robert E. Rich Jr. ultimately pulled out of the race, citing high expansion fees and rampant salary escalation. There’s a school of thought that he was headed for a roadblock anyway since Buffalo’s presence wouldn’t impact future network television negotiations as significantly as the four cities that were awarded franchises: Tampa, Miami, Denver and Phoenix.

“If a college such as Buffalo were to want to attract interest from one of the major conferences, it would need to show that the demand to watch Buffalo football on television would be great enough to increase the overall revenues derived from the conference’s television broadcasting for each of the existing members, even after a share is given to Buffalo as the new member,” said Marc Edelman, an associate law professor at the Zicklin School of Business, Baruch College, City University of New York and a sports business scholar.

“If you look at the three most recent expansion members in the Big Ten – Rutgers University, the University of Nebraska and the University of Maryland – each of those three universities already had a large national following for their sports programs,” Edelman said.

“Buffalo may have a very strong regional following for its football program, but it does not seem to be operating on a nationally well-known basis. The college conferences today operate for the most part to maximize revenue for the individual members and the members collectively.”

Pronounced revenue increases suggest that any school desiring to marry into one of the Big Five families must come equipped with wealth and prestige, and preferably both. For instance, the Big 12, although just a 10-member conference, dismissed the notion of imminent expansion following its conference meetings in June.

“We’ve not really talked at all about expansion,” West Virginia athletic director Oliver Luck said. “At the end of the day it’s sort of a mathematical issue really. We only have 10 teams in the Big 12, our dominator is 10 in terms of the contracts the conference has signed with FOX and ESPN.

“That money gets divvied up 10 ways. Adding a school or two schools just for the sake of having a few more would increase the dominator to 11 or 12, and unless those schools really bring in commensurate value, which is difficult to calculate, but unless they bring in that commensurate value it’s very difficult to say, ‘Yeah, that makes sense.’ Nobody wants to decrease the size of the payout.”

UB’s White agrees this might not be the optimal time to seek inclusion in a major conference even if UB possessed the facilities and the athletic budget to make a case. But as the current television deals near expiration, White said, the major conferences might seek to magnify their allure by broadening their media footprint in advance of new contract negotiations.

“These are 10-, 12-year contracts,” White said. “It’s hard to change your revenue pool in the middle of a contract with a national television organization. I guess I’m not going to be shocked if there’s another conference carousel when the contracts are up again. I’m not saying we’re going to be involved in it. I think we have a lot of work to do to get good in the MAC. And that’s our focus.”

If any of the Big Five eventually opt to expand, UB – should it make relatively rapid progress on the athletics front – would be just one of the schools in the mix.

Cincinnati, which played in the 2009 Orange Bowl and 2010 Fiesta Bowl, saw its football clout diminish when Big East rivals such as Syracuse, Pitt and West Virginia fled for greener pastures. This year the Bearcats hired a new AD in Mike Bohn, who orchestrated Colorado’s move to the Pac-12, with hopes of advancing out of the second-tier American Athletic Conference. Connecticut, which won this year’s men’s and women’s national basketball championships, shares the same Big Five ambition. Boise State was poised to join the Big East until the conference disintegrated and re-formed as a non-football playing entity.

UB, with an athletic budget of roughly $28 million, has a ways to go to equal those schools in the arena of financial resources. Boise State operates at $33 million, Cincinnati at $45 million, UConn at $63 million, according to 2012 numbers filed with the Department of Education. And $22 million of UB’s athletic budget comes from university subsidies.

Increasing revenues can spur budget growth but increasing revenues – especially to a large degree – can be a Herculean task for a mid-major. The major conferences place multiple teams in the NCAA basketball tournament. UB’s league, the Mid-American Conference, typically gets one. The major conferences have an inside track to the more lucrative football postseason bowl games, including the national championship game. MAC teams typically play in a succession of minor bowls and have done well if they break even financially.

Schools in the big conferences generate revenues that dwarf those of the mid-majors, and that translates into might and privilege. The division of power is perhaps most evident early in the football season. Ohio State paid the University at Buffalo $1 million to play a non-conference game at Ohio Stadium in last season’s football opener. If it sounds like a lot it is – for UB. The $1 million is equal to roughly 3 percent to 4 percent of UB’s annual total athletic budget. But it represents, give or take, just 2 percent of Ohio State’s annual revenues for football alone. UB takes the money and Ohio State gets another day’s gate revenues and an opponent it should beat.

Ohio State athletics, with about $140 million in annual revenues, operates subsidy-free and has few peers. The median budget for a Big Ten school is almost $100 million, according to their financial disclosures. Those numbers emphasize the degree of progress UB must achieve if it is to become “big time” in the truest sense.

And that gap may have just widened. The NCAA board of directors last week approved legislation giving the big five conferences the autonomy to operate under separate rules. It’s expected that, for one, they’ll implement athletic stipends intended to cover costs beyond room, board and scholarships. Not only will that drive up budgets, it could widen the recruiting divide.

For instance, MAC schools currently might sometimes sign players also recruited by Big Ten schools by dangling the carrot of earlier and more extensive playing time. The new and powerful Big Ten counter to that argument: “Yeah, but come here and all your costs are covered.”

The Mid-American Conference announced on Aug. 14 the creation of a task force to examine the issue.

The mountain is high and the climb steep. UB has spent 10 years trying to raise funds just for a $20 million field house/football practice facility. The idea that it could make a gargantuan leap forward and position itself for an invite to a Big Five conference seems like crazy talk.

But Boise State made it to within arm’s length of the summit. Louisville gained entrance to the ACC through a renewed emphasis on its football program. A blueprint exists, and when those current Big Five TV contracts near expiration …

“It’s difficult to say,” West Virginia’s Luck said. “But I will say life is not static. Life is dynamic. Boise State is a great example of a school the last 15 years that’s really positioned itself very well. There could be a couple schools that do that the next 10 years.”

“The reality, with this population and with an NFL team, are we going to be 120,000-seat Neyland Stadium, Tennessee, probably not,” White said. “But we should aspire to what Cincinnati has. I think that’s pretty big time compared to where we are and where we’ve been historically. And once we get there, we’ll have the same aspirations they have now.”