As first appeared in Boxscore
By Aron Solomon
The inevitable finally happened – an article in a reputable sports site opened a Pandora’s Box that not only should never have been opened, the box should have been tossed off a cliff.
But Front Office Sports is driving a national college sports dialogue forward that will, over the next weeks and months, examine whether using university endowments to fund conference realignment is a wise move.
We know that the idea of conference realignment isn’t going away. As I’ve been predicting for well over a year, we are heading toward megaconferences for college football. This is all being driven by the desire for schools to maximize revenue potential for a game where the money is now so astronomical that it’s beyond reasonable belief.
Conference realignment allows schools to gain both a competitive and comparative advantage over other schools, increasing TV and streaming media exposure. In other words, for a select number of elite college football programs, conference realignment is the path to previously unimagined wealth.
The relatively new dialogue about funding inclusion in these megaconferences is a scary one – it’s going to cause some university presidents sleepless nights and the wrong decisions here will cost others their jobs.
My position is and has been clear: I’m 100% against any university funding inclusion in a megaconference using even a cent of their endowment. A university endowment isn’t a checking account. I see nothing but bad things coming from drawing into endowment money to move conferences – it’s just a form of gambling that dipping into the endowment might help the school access a pot of gold.
As William Cooper, a New York lawyer, observed, “It was never the intention of any college’s endowment to fund anything remotely like this. A college endowment is there to generate income to support the school’s educational mission.”
I am fully aligned with Cooper’s analysis, but precisely because this endowment conversation will intensify as conference realignment continues, let’s deep dive into how the pros and cons break down.
Pros of Funding Conference Realignment Using Endowment Funds:
Financial Stability:
Conference realignment can provide financial stability to universities by increasing revenue potential. By using endowment funds to support conference realignment, universities can ensure long-term financial viability.
Competitive Advantage:
Conference realignment allows universities to strategically position themselves in conferences that offer better competition and resources. This can enhance the competitiveness of athletic programs and attract top-tier athletes.
Geographical Pipelines and Facilities:
Joining a new conference through realignment can provide access to new geographical pipelines and state-of-the-art facilities. As Sportico asserted, this can enhance recruiting efforts and improve the overall quality of athletic programs.
Television and Streaming Exposure:
Sportico also made a cogent argument that conference realignment can lead to increased television exposure for universities and their athletic programs. This exposure can result in higher visibility, increased fan base, and potentially more lucrative media rights deals.
Creation of New Rivalries:
Conference realignment can create new rivalries between universities that were previously in different conferences. These rivalries can generate excitement, fan engagement, and increase attendance at games. Even though this is in the “pros” section, it’s impossible to ignore that many of these new rivalries will be made-for-TV ones, with horrible geography behind them. USC-UCLA is a natural rivalry separated by a few miles. Realignment doesn’t work that way.
Cons of Funding Conference Realignment Using Endowment Funds:
This Isn’t What Endowment Are For:
As the Front Office Sports piece points out, endowment funds to finance conference realignment can be controversial. Some argue that endowments should be used for other purposes, such as funding scholarships and supporting academic programs.
Uneven Distribution of Talent:
Conference realignment can lead to an uneven distribution of talented teams across conferences. This can result in some conferences becoming more dominant while others struggle to compete, potentially leading to a lack of competitive balance. This is going to be much worse than anyone can imagine. The megaconferences I have long been predicting are going to be the only talent magnets out there. They will attract not 50% of the nation’s top football talent, but 95%. This is decidedly not good.
Toxicity for the NCAA:
Conference realignment has the potential to be toxic for the NCAA as a whole. It can lead to the creation of superconferences that break off from the NCAA, undermining the organization’s authority and structure. While I listed this here as a con, I personally believe this is a massive pro. The NCAA has outlived the totality of its usefulness – it’s time for the NCAA to go and megaconferences might be the last straw.
Uncertain Futures for Some Schools:
Conference realignment can leave some schools with uncertain futures. If a university is not invited to join a new conference during realignment, it may struggle to find a suitable conference affiliation, which can impact its athletic programs and financial stability. The domino effect here is going to be pretty massive. As traditional conferences implode, not all of the leftover pieces will be able to coalesce. There are absolutely going to be schools left in the cold.
This conversation is just beginning. The right thing for university presidents to do would be to shut it down now, which, of course, they won’t do. University endowments were never designed to be the stuff of sports bets, even if the potential payout could be massive.
About Aron Solomon
A Pulitzer Prize-nominated writer, Aron Solomon, JD, is the Chief Legal Analyst for Esquire Digital and the Editor-in-Chief for Today’s Esquire. He has taught entrepreneurship at McGill University and the University of Pennsylvania, and was elected to Fastcase 50, recognizing the top 50 legal innovators in the world. Aron has been featured in Forbes, CBS News, CNBC, USA Today, ESPN, TechCrunch, The Hill, BuzzFeed, Fortune, Venture Beat, The Independent, Fortune China, Yahoo!, ABA Journal, Law.com, The Boston Globe, YouTube, NewsBreak, and many other leading publications.
A Pulitzer Prize-nominated writer, Aron Solomon, JD, is the Chief Strategy Officer for AMPLIFY. He has taught entrepreneurship at McGill University and the University of Pennsylvania, and was elected to Fastcase 50, recognizing the top 50 legal innovators in the world. Aron has been featured in Newsweek, The Hill, Fast Company, Fortune, Forbes, CBS News, CNBC, USA Today, ESPN, TechCrunch, BuzzFeed, Venture Beat, The Independent, Fortune China, Abogados, Today’s Esquire, Yahoo!, ABA Journal, Law.com, The Boston Globe, and many other leading publications across the globe.
Discover more from Today's Esquire
Subscribe to get the latest posts sent to your email.