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Sports Business: BCS selection process spurs debate
Dec 30, 2007
BCS: Just Sore Losers or Legitimately Robbed?Matt Egan
FOXBusiness
NEW YORK -- There’s less mystery surrounding both Skull and Bones and Area 51 combined than you’d find in the formula for picking who makes it to the Bowl Championship Series.
The BCS system helps crown the champion of college football and is part of a larger $400 million bowl industry.
While sports fans love to debate the merits of the system, it’s important to remember that the way college’s elite teams are selected to the five nationally televised BCS bowl games bears a direct financial impact on colleges and universities.
The winners of the selection process will be on a national stage this week, with the Rose and Sugar bowls set to kick off the BCS on New Years Day and two more games leading to the culminating National Championship Game on Jan. 7.
Each year a team that seemingly has a stronger record and a higher ranking loses out and fails to get picked for a BCS game. The BCS admits that they aren’t employing a “perfect” system but also said that few realistic alternatives have been offered up.
The latest team to have its fans cry foul over the BCS system was this year’s University of Missouri football team. Despite having beaten division opponents Kansas and Illinois and finishing higher than them in the BCS standings, Mizzou was left out of the big dance while their division rivals got invites instead.
“If I was the athletic director at Mizzou or the president I’d be upset. I think fundamentally the BCS selection process can be very arbitrary,” said Andrew Zimbalist, a professor at Smith College in Massachusetts and sports business expert.
In fact, an ESPN.com poll taken a day after the BCS results were announced showed that 69% of the nearly 100,000 voting said the BCS didn't get it right. Just two states in the nation approved of the results. Which two states were satisfied? Well the two that saw their schools get invited to the BCS championship game: Louisiana and Ohio.
“We know it’s not a perfect system, but it’s done a great job of putting number one and number two together,” said Shawn Schoeffler, vice president of media relations of the Tostitos Fiesta Bowl.
Each of the BCS bowl games pays out $17 million to the conferences represented. The conferences, based on their own rules, divide the payout among all of the teams in the conference.
If an additional team from a conference is lucky enough to make a BCS bowl, the conference receives an extra $4.5 million.
But there are also lucrative benefits that come from an appearance in these nationally televised games, like name recognition, a free 30-second commercial about each university and licensing fees from selling more team apparel.
“Being in or being out can have huge financial implications not only for the team that plays, but for the team that didn’t play,” said Paul Swangard, managing director at the University of Oregon’s Warsaw Sports Marketing Center.
The BCS selection process uses a combination of standings, polling and computer-generated rankings to come up with a formidable national championship match up, as well as participants for the runner-up bowls. (To see a full explanation of the formula click here).
However, the college football system is complicated by the lack of a playoff system found in other sports like NCAA basketball’s March Madness.
The BCS gets much of its revenue from sponsorships from companies like Citigroup (C), FedEx (FDX), Allstate (ALL), as well as from television deals from News Corp.'s (NWS) Fox and Disney’s (DIS) ABC.
News Corp., the parent company of FOX Business, reportedly pays $85 million a year for the television rights to four of the five games. Last year’s championship game drew the third-largest BCS audience in history, with more than 28 million viewers tuning in.
“It’s quickly gotten to a level where that is the ultimate goal of every team across the country,” said Schoeffler.
The afterglow both financially and sentimentally for schools that make it to the biggest games certainly explains why those who barely miss out aren’t just sore sports.
“Because we are talking potentially about a large amount of money, the losers are going to scream foul. Missouri looks like it’s going to be a loser in this case,” said Joseph Haslag, an economics professor at Mizzou.
The public relations coup for universities appearing in a BCS bowl can be significant.
“You can’t underestimate the marketing value of making it into one of those games,” said David Carter, professor of sports business at USC Marshall School of Business.
Specifically, the free 30-second commercial spot, which for a television audience like this could cost in upwards of $500,000 in the open market, has a special value.
“They certainly wouldn’t have otherwise gone out and bought that exposure,” said Bill Glenn, vice president of insights and analytics at The Marketing Arm in Dallas.
“That is an opportunity that very few schools ever have,” said Carter.
Increased apparel sales can lead to an influx of several million dollars for some schools.
For example, had Oregon State finished stronger and made the BCS title game, estimates were for an extra $5 million to $6 million in merchandising sales.
The new exposure and national recognition can also lead to increased pride in the university and an influx in donations from alumni, experts said.
If that’s not enough, future football programs are often aided after a big bowl game from more recruits.
“That is how you stay among the elite: recruiting,” said Jim Marchiony, associate athletic director at the University of Kansas, the school that edged out Mizzou for a BCS bowl.
The admissions departments at universities also have to love the surge in college applications that typically accompanies a bowl game berth.
“Any time you get a national audience like that and have an ability to advertise what your university is all about, that’s value that is much more visible than the direct mail pieces that your kids get at home,” said Glenn.
While there isn’t a proven correlation between athletic success on a national level and a boosting of academic prestige via higher SAT scores, having more applications certainly lets schools say they are being more “selective,” a factor in most college ranking systems.
Experts said that the benefits from an appearance in a BCS bowl game are intensified for schools that aren’t necessarily known nationally as athletic powerhouses, like last year’s Fiesta Tostitos Bowl champ Boise State or the University of Hawaii this year.
It’s not clear if an overhaul of the BCS selection system will be coming any time soon, but that won’t stop fans and sports columnists from continuing the debate.
“I don’t know of a sport that creates more water cooler discussion week in and week out than the BCS,” said Carter.
