How much money does the NCAA make from college basketball?

Monday, April 7, 2014 - 12:39pm

Four letters, hundreds of millions of dollars, and a major influence on a massively popular sports industry.

The business of the NCAA is thriving.

But is it sustainable?

The non-profit organization says it puts its money where its mission is "equipping student-athletes to succeed on the playing field, in the classroom and throughout life."

The NCAA rakes in around $800 million dollars each year.

Its endowment is more than $500 million.

So where does all the money come from?

"The institution itself that's based in Indianapolis, makes money primarily through television rights to the March Madness basketball tournament. They get somewhere in the neighborhood of $770 million dollars a year. That constitutes around 90% of all of the revenue that goes to the NCAA," said Andrew Zimbalist, an economics professor at Smith College.
CBS and Turner Sports, part of the Time Warner family along with CNN, own those broadcast rights.

Ticket sales also make money for the NCAA.

And corporate sponsors pay millions to get their names in the game.

AT&T, Capital One, and Coca-Cola are NCAA "corporate champions"

Other big names have signed on as official corporate partners.

But most of that cash is headed back to campus.

About $100 million supports programs for players.

And more than $500 million is distributed directly to schools - or to the conferences they belong to.

The schools can spend the money however they choose, but much of it pays the salaries and benefits of coaches and staff.

The rest is split between expenses like facility costs and team travel.

And then, there's the scholarships.

More than 150,000 student-athletes get athletic scholarships every year -- from colleges and universities, a value the NCAA puts at $2.4 billion.

And it's a perk the organization has used to justify the money it makes off players.

But some critics say the NCAA is at a crossroads.

"The organization is in a difficult position because they are the supervisors of a system that is a hybrid system. It's presumably halfway between commercialism and amateurism," Zimbalist explained.

Many now say it is time to pay athletes.

"They're talking about $2500 to $5000 dollars a year, which would be optional, you'd give it to obviously only your star players. They would then be able to go to college, and not have to dip into their own pocket or not have to look for boosters to help them pay for many of their living expenses," Zimbalist told CNN.
There's a huge class action lawsuit challenging the NCAA rules that prohibit athletes from being paid.

A few thousand dollars a year is obviously far from the millions professional athletes make.

But it would mark one of the most significant changes in the NCAA's 100-year history.

The NCAA said in January its members do not support the professionalization of college sports.

NCAA board of directors chairman Nathan Hatch also said he's opposed to the idea of paying players.
He says it gives the wrong incentives for student athletes, and it could have very damaging effects on other sports, particularly women's sports, with much of the revenues going to football and basketball.


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