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Ncaa Football Paper

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NCAA Football
And The
Possible Realignment of
The Teams into
Super Conferences

Mergers and Acquisitions
Anthony Pranger
October 2011
Introduction:
NCAA football is a wonderful and exciting sport, of which I basically know the rules and enjoy watching when I have the time. To be perfectly honest though, this is not a topic that I know much about when it comes to the rankings, divisions and how they determine who will play against who in the upcoming season. Since I lack in knowledge regarding this topic and am not one to back down from a challenge, I have decided to run forward and tackle the topic and research college football, and the inner workings of the sport. This will give me the opportunity to learn more than just accounting and business principles while attaining my master’s degree. First things first, I feel a good description of the sport and its foundation is in order. This will really help put things in perspective, so that I can charge forward and score a touchdown with this paper. NCAA football is also known as College football or pigskin football. Each team is a college (university) and they compete in divisions. The division that has the best teams is called the Division IA and is divided in too many different conferences. The players are amateurs (they do not get paid to play) but they do receive a college scholarship. Each football team can offer a free education to 85 players.
College football is all but clear because it does not have a true championship. There are more than 114 teams and they can’t all play each other during one season. So each team plays a season of 14 games within their conference. Each week a panel of reporters and coaches vote on which team is pretty good and the result is compiled in a top 25. It is a ranking based on impression by humans therefore it is totally unscientific even though complicated formulas are used to come up with the ranking and therefore many discussions are based on their idea why such a team is ranked so high or so low in the top 25.
The post season is a trip to a bowl. Cities that organize bowls invite teams to come compete for a game. Usually teams are selected according to how much money they will bring to the city with their fans. The team that wins the bowl gets a paycheck that can range from $500 thousands to $17 millions! For many years the top 1 and 2 did not play against each other so there was no way to really know which the best team was. But now there is the Bowl Championship Series that is a game where the number one and number two teams play. http://www.fabqb.com/football/ncaaFootball.php Division IA and its perspective conferences are essentially a matter of mergers and acquisitions, and as in any M&A there are many stakeholders. Currently, there are just far too many conferences, it is difficult to keep track of which team is in which conference and this causes a lot of speculation on which team could possibly be the best, or worst for that matter. The new trend in the NCAA is, to form super conferences. Super conferences, are where existing conferences add members from other conferences to form even bigger conferences and eventually eliminate the smaller conferences. Looking at the research, I conclude the most likely result could be 4, 16-team super-conferences which are then split into 2 8-team divisions. Divisional winners play for the conference title, and the winners of the 4 super-conference title games will comprise 4 of the 8 teams in the national quarter-finals. This is very similar to the business world of today; many of the big companies are either merging with the smaller companies or eliminating them altogether. Some of the problems that arise from realignment into super conferences lie in the regulations, finances and general risks. Before I go into each of these problems, I feel it is important to identify the stakeholders in the NCAA program.

Stakeholders 1. The Fans: The fans of NCAA football, are like the stockholders of a major company, they should all have a vote in how the conferences are setup and be allowed equal opportunities. 2. The players: The players are the ones doing all the work; they are constantly attending practice, traveling for the games and let’s not forget, achieving their college degrees. 3. The coaches: Coaches are developing strategies, counseling the players, and just basically keeping the team in line. The coaches play a major part in this, because realignment can dramatically affect their salaries and how many coaches there are for each team. Coaches will gather together and look at the financial part of their team and proclaim to the conferences that they have decided to be “in play” or looking for bids to be bought out of their current conference. 4. Television networks: These television networks provide a lot of the revenues for the football teams; they set up contracts with the conferences, spend many dollars on coverage of the games, and ensure fans the opportunity to enjoy the games where ever they are. 5. Colleges as a whole: Many of the students who attend these colleges will attend many of the games. If super conferences lead to logistics issues, the student attendance can surely affect the stadium revenues that the teams receive. 6. Conference organizers: These are the administrative and executive members of the conferences. These members of the conferences decide which teams they want to go after. They also decide how many teams they want the conference to expand into. The bigger the conference the more pieces of the pie for revenues. These people are essentially the buyers and the teams are the targets.
Regulations
The most prominent regulation that comes to mind with the formation of super conferences is that it will lead to a monopoly of all the funds produced by television contracts. This will also lead to a centralization of all the teams with a big followings, hoarding all the funds that come from the fans who attend the games at their perspective stadiums. The FTC would be the branch of the government that would decide if a monopoly could arise. They would thereby step in and stand up for the general consumer, the fans and colleges that will not end up being a part of the super conferences because they have a much smaller following and do not get the television contracts. These colleges and fans are important stakeholders. They cannot just step aside and let this idea become reality. These funds are very important for team member scholarships, uniforms, director’s salaries and overall general needs.
Finances
The two most important finances involved are television contract revenues and stadium revenues. Big networks like ESPN, CBS, ABC and the Big Ten network are the major players here. These networks return revenues of billions of dollars which are negotiated with the conferences and trickle down to the teams and provide the ability to finance their general needs. Needs like; salaries for the coaches, uniforms for the players and turn around funds that help pay for the players scholar ships. Stadium revenues come from students of the perspective colleges in one particular game, season ticket holders, and the concessions within those stadiums. These revenues also flow back into the teams and help with their general needs.

Risks As mentioned before, the most prominent risk is the risk of monopolies. If super conferences are formed, most of the stakeholders will follow in the direction of the big games, games of the super powers. Along with this following, will go the revenues that these stakeholders produce. Some of the risks that will evolve otherwise are that smaller schools will fall apart; other sports within each school will lose fans and diminish the funds they would normally receive. Coaches for other sports and football will strive to be a part of the super conferences and take their coaching abilities away from the teams that really need the structure they provide. Colleges across the nation could change dramatically all because of the evolution of these super conferences.
Conclusion
Based on the research I have done for this paper, I lean away from the development of the super conferences. I believe that the smaller universities or teams with less following are a strategic part of the game. All of the teams need opportunity to develop and rebound to better educated and stronger levels. If the super conferences evolve they will gather so much revenue that they buy up all the major teams and produce a clash of the titans. One of the most important stakeholders that I have not really mentioned is the parents and relatives of the players for the smaller and less followed teams. These individuals will rise up and stride against this super conference idea. I feel that the FTC needs to step in at one point and prevent this operation which is essentially against the general public interest. Through all of the research I have done for this paper I have not really seen much disappointment from the general stakeholder on how the program is currently organized. The current conferences are based mostly on logistics and people want to attend games, and watch games that are relatively close because they consider these teams to be their rivals. If the super conferences are allowed in it could lead to development of conferences that are all over the United States and a ridiculous amount of travel time for the teams. In the end my research turned up many of the stakeholders that are disgruntled and against the development of super conferences for the reasons that I have mentioned and for many reasons I have not even begun to describe.

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