New Rose Contract Means Mo Money

July 16, 2012

Written by Jon Miller

On Monday, it was announced that ESPN will pay the Rose Bowl $80 million per year to televise the Grandaddy of Them All.  That is a LOT of money for one football game.

In the years when the Rose is NOT a national semifinal game (once we get to the four team playoff era in a couple years), the Big Ten and Pac 12 will split those revenues, or $40 million per conference.  That is a 167% increase over what the bowl receives now, which is $30 million per year or $15 million to each conference if they had a team in the game.

The Big Ten pools all of their bowl revenues into one pot.  The league keeps 5% and the rest is paid out equally to league schools after each school participating in a bowl game is given a ‘travel allowance’.  Those travel allowances differ from bowl to bowl, with a larger allowance going to teams who are participating in a more prestigious (read that higher paying) bowl game.

Each Big Ten team receives the same after the bowls are over revenue check regardless of the bowl they are playing in and regardless of if they are in a bowl or not.

Last year, that number was around $400,000 per member school not named Nebraska, who is still in their ‘buy in’ phase of Big Ten booty payouts.

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Given that we are now looking at an additional $25 million for the Big Ten over and above the $15 million from the past, that’s a lot of money that will now be going to each school.

For the sake of easy math, let’s assume the Rose Bowl ‘allowance’ paid to a participating Big Ten school will be roughly the same as it was before.  Take $25 million times .95 to get to $23,750,000.  That 5% goes to the Big Ten offices.  Divide $23,750,000 by 12 (Nebraska is still not getting an equal share but will soon) and that SHOULD get you $1,979,166 more per school than where things are currently.   Toss in the $400,000 per school figure from last year, based on a $15 million payout from the Rose to the Big Ten plus the other revenues from the bowls and we are now at $2,379,166 per school from bowl revenues whether or not you qualify for a bowl or not.

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This is a number that comes before the Big Ten potentially shuffles their bowl affiliations and before more bowl television contracts are renegotiated with TV networks who are gobbling up bowl tie ins as the last available pieces of land in the college football landscape.

That said, it will be interesting to see if there is much of a $$$ boost associated with bowls like the Capital One or the Outback, as those bowls will not factor into the national title picture.  The Cap One has been the highest paying non-BCS bowl for the past several years.

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Expect similar TV contracts and revenue amounts with the other major bowls, bowls we use to refer to as BCS bowls, as the Rose has now set the market.  The Rose will be in the national semifinal mix, as will some of the other former BCS bowls and likely the newly created Champions Bowl. However the Champions Bowl will pit an SEC v B12 match up, so the Big Ten will not get a piece of that revenue on a regular basis.  The ACC has created a tie in with the ACC champion and I suspect Notre Dame is going to angle for the other slot if it meets baseline criteria, such as an eight-win season.  What will the Fiesta do?  Who knows.

We know that this new Rose Bowl deal will mean more money for each Big Ten school and is also the tip of the iceberg as to how much new money is going to be pumped into the college football stratosphere given the brave, new four-team playoff world we’ll see in a few years.

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