No one's asking the question is it good for ball? My take... I believe in the free market and people getting paid for their efforts especially if those efforts generate revenue. However, it's a downgrade in the overall fan experience at least for me anyway. I won't tune in as often. I understand others will which I have no problem with. To each his/her own. I'm sure they've done the math that it ultimately it will be good for $, you lose some fans but win some more, raise prices, etc. But given it's a huge change there's at least a chance it doesn't work out for more $ overall. We'll see how it goes. Expect prices to skyrocket and colleges to go the route of the pros to maximize $ at the expense of every day fans. Don't mean to be negative, it is what it is. Let's see how it all works out for fans and how much they will support the new reality. I'm not rooting against it but I am not convinced it will work out for all concerned. There will be winners and losers for sure.
I'm not surprised that we're doing ok so far. The impression I have is that we really like our nonrevenue sports (perhaps more than anyone but our friends across the bay) and will do what we need to do to keep them viable. We put less weight on winning for its own sake and more weight on not embarrassing the university than a lot of schools do, but when push comes to shove we can be as pragmatic as anyone.
Given the financial issues, the only way Cal Athletics as we know it will be able to succeed going forward will be through very large direct institutional support; I'm thinking $50 million, or more, per year from the central campus. This may be possible, but it will be fraught with internal campus politics.
Nick, thank you! This is the most cogent summary I have seen to date (and I've been looking!). But now I need to pivot to the next question, for which there is likely not yet an answer. Has anyone modeled what this looks like for us? First, there will be some reduction in future NCAA distribution to us to pay for the past settlement. Next, where on earth will we come up with an additional $22 mil, or even half that, given already known reductions in revenue from the move to the ACC (vs at theoretical Pac 12 deal). Yes Calimony is great but it does not come near to plugging the delta, particularly the new one. Unless I'm wrong, while fantastic, Cal Legends has been raising in the range of $1.5 mil, so it's not there. Bottom line, I need help with the math to share the nominal optimism I'm seeing expressed.
I've written pretty extensively on Cal's overall financial model. Won't repeat it all here, but bottom line Cal needs (significant) additional donations from major donors ($10m minimum), you need to significantly cut expenses ($10m minimum) and you need more help from Central Campus. This plus Calimony and the math sort of pencils out. On California Legends, you are (thankfully) wildly off. We don't discuss our overall budget for competitive reasons (if other schools know what you have they know how much they need to beat you) but $1.5m wouldn't even get you in the game for either revenue sport (much less together). We are doing much, much better than that.
Very pleased to be wildly off. I do have to add that on some level it bothers me that there is not more transparency on the whole NIL thing. Not laying any blame on Cal Legends, but just the whole structure...but this is now likely all moot. Onward! Go Bears!
What a very nice article. Thank you so much! There’s a lot to fear in this new world, but for Cal at least there’s a reason for hope. Cal badly needed a paradigm shift in its revenue sports since the old one had us without a Rose Bowl appearance in 65 years and only a single conference championship in MBB in roughly the same time frame. For a school of our size with our commitment to academic excellence it was beyond embarrassing. And then along came NIL and it gave us a new lease on life. As much as some folks hate it, it was pretty tailor made to play to Cal’s strengths. But I do have to give a shoutout to our recruiting staff too. Marshall Cherrington and Benji Palu in football and Amorrow Morgan and Adam Mazarei in MBB have killed it. None of this would be happening without them Go Bears!
Great article. I've also been moved from pessimism to optimism with the success we've been having in football and men's basketball with the coaches and Cal Legends partnering. If you take a step back and just ask yourself whether UC Berkeley has the geography and alumni to be successful, it's a no brainer. So it really is up to the leadership to capitalize on the regional wealth and alumni wealth to produce winning teams that perpetuate that support.
I would think the new 20 mil situation, with NIL as the add-on to attract the best of the prospects with even more money, could coexist going forward, no?
This was a cogent and helpful post. How Cal is able to accommodate the $20 million annual distribution in the face of limited revenue sources and Title IX requirements in the face of our number of sports teams, will be a complex challenge. We are a long way from our picture, and the future of college athletics in general, becoming clear.
Yep, that's my question too.. Where does the 20M come from if we're already operating from the red? Does this force the hand of athletic departments like ours to cut sports? (If money needs to be redirected away from non-revenue sports and to the players of revenue sports.) Or do we simply not pay anywhere near the 20m limit that the rich teams will be able to do? If I read the news correctly, the revenue sharing is optional and capped, but not required. So the inequities between the haves and have nots persist and intensify, but at least a big part of it is now above board. NIL will still remain a dirty secret to pay athletes (for reasons other than their NIL in reality) to augment that, so at least Cal can (hopefully) continue to effectively use that to make up some ground.
I think a lot of people held back Athletic Department donations because of amateurism ("I'm just paying for coaches and facilities") and became more willing to send $$ to NIL once it was available. People will up their Athletics donations if they know some of that will go to players beyond the usual room/board/healthcare
Nick: Thank you. I've been wondering why we've been doing so well in the portal in both football and basket ball while furd has not. The timing of the new chancellor is fortuitous, right when we need to pivot again. He drinks the kool-aid, he was at The Play, and he is a fan of the capitalism behind both academia, such as CRISPR, and athletics.
It would be nice to somehow get Legends under the UC umbrella enough to make donations tax exempt. But Legends worked precisely because it was MANDATED to stay clear of the bureaucracy that always has some rule or policy that makes the smart or efficient thing impossible. I think having the money earmarked actually helps insulate it.
I think Lyons is the right Chancellor to manage this transition. I just hope he can. I'm not a pessimist but a realist who recognizes the challenge.
IMO if they are smart they will let the guys running the NIL collective have a big hand in handling the upcoming financial changes. It's pretty clear the donors trust them more than Knowlton and the existing administration.
It’s impossible not to be pessimistic about even our desire to confront this new landscape. And yet even Drake, Knowlton and Christ could see this coming from a mile away and we’re largely paying our way into the ACC. Which says to me someone did the math and valuations and they have determined there’s still value in pay to play athletics.
No one's asking the question is it good for ball? My take... I believe in the free market and people getting paid for their efforts especially if those efforts generate revenue. However, it's a downgrade in the overall fan experience at least for me anyway. I won't tune in as often. I understand others will which I have no problem with. To each his/her own. I'm sure they've done the math that it ultimately it will be good for $, you lose some fans but win some more, raise prices, etc. But given it's a huge change there's at least a chance it doesn't work out for more $ overall. We'll see how it goes. Expect prices to skyrocket and colleges to go the route of the pros to maximize $ at the expense of every day fans. Don't mean to be negative, it is what it is. Let's see how it all works out for fans and how much they will support the new reality. I'm not rooting against it but I am not convinced it will work out for all concerned. There will be winners and losers for sure.
I'm not surprised that we're doing ok so far. The impression I have is that we really like our nonrevenue sports (perhaps more than anyone but our friends across the bay) and will do what we need to do to keep them viable. We put less weight on winning for its own sake and more weight on not embarrassing the university than a lot of schools do, but when push comes to shove we can be as pragmatic as anyone.
Given the financial issues, the only way Cal Athletics as we know it will be able to succeed going forward will be through very large direct institutional support; I'm thinking $50 million, or more, per year from the central campus. This may be possible, but it will be fraught with internal campus politics.
Nick, thank you! This is the most cogent summary I have seen to date (and I've been looking!). But now I need to pivot to the next question, for which there is likely not yet an answer. Has anyone modeled what this looks like for us? First, there will be some reduction in future NCAA distribution to us to pay for the past settlement. Next, where on earth will we come up with an additional $22 mil, or even half that, given already known reductions in revenue from the move to the ACC (vs at theoretical Pac 12 deal). Yes Calimony is great but it does not come near to plugging the delta, particularly the new one. Unless I'm wrong, while fantastic, Cal Legends has been raising in the range of $1.5 mil, so it's not there. Bottom line, I need help with the math to share the nominal optimism I'm seeing expressed.
I've written pretty extensively on Cal's overall financial model. Won't repeat it all here, but bottom line Cal needs (significant) additional donations from major donors ($10m minimum), you need to significantly cut expenses ($10m minimum) and you need more help from Central Campus. This plus Calimony and the math sort of pencils out. On California Legends, you are (thankfully) wildly off. We don't discuss our overall budget for competitive reasons (if other schools know what you have they know how much they need to beat you) but $1.5m wouldn't even get you in the game for either revenue sport (much less together). We are doing much, much better than that.
Very pleased to be wildly off. I do have to add that on some level it bothers me that there is not more transparency on the whole NIL thing. Not laying any blame on Cal Legends, but just the whole structure...but this is now likely all moot. Onward! Go Bears!
Hallelujah! Or in more Cal fashion...Fiat Lux!
What a very nice article. Thank you so much! There’s a lot to fear in this new world, but for Cal at least there’s a reason for hope. Cal badly needed a paradigm shift in its revenue sports since the old one had us without a Rose Bowl appearance in 65 years and only a single conference championship in MBB in roughly the same time frame. For a school of our size with our commitment to academic excellence it was beyond embarrassing. And then along came NIL and it gave us a new lease on life. As much as some folks hate it, it was pretty tailor made to play to Cal’s strengths. But I do have to give a shoutout to our recruiting staff too. Marshall Cherrington and Benji Palu in football and Amorrow Morgan and Adam Mazarei in MBB have killed it. None of this would be happening without them Go Bears!
Well said. I agree.
Great article. I've also been moved from pessimism to optimism with the success we've been having in football and men's basketball with the coaches and Cal Legends partnering. If you take a step back and just ask yourself whether UC Berkeley has the geography and alumni to be successful, it's a no brainer. So it really is up to the leadership to capitalize on the regional wealth and alumni wealth to produce winning teams that perpetuate that support.
I would think the new 20 mil situation, with NIL as the add-on to attract the best of the prospects with even more money, could coexist going forward, no?
This was a cogent and helpful post. How Cal is able to accommodate the $20 million annual distribution in the face of limited revenue sources and Title IX requirements in the face of our number of sports teams, will be a complex challenge. We are a long way from our picture, and the future of college athletics in general, becoming clear.
Yep, that's my question too.. Where does the 20M come from if we're already operating from the red? Does this force the hand of athletic departments like ours to cut sports? (If money needs to be redirected away from non-revenue sports and to the players of revenue sports.) Or do we simply not pay anywhere near the 20m limit that the rich teams will be able to do? If I read the news correctly, the revenue sharing is optional and capped, but not required. So the inequities between the haves and have nots persist and intensify, but at least a big part of it is now above board. NIL will still remain a dirty secret to pay athletes (for reasons other than their NIL in reality) to augment that, so at least Cal can (hopefully) continue to effectively use that to make up some ground.
bingo
I think a lot of people held back Athletic Department donations because of amateurism ("I'm just paying for coaches and facilities") and became more willing to send $$ to NIL once it was available. People will up their Athletics donations if they know some of that will go to players beyond the usual room/board/healthcare
Nick: Thank you. I've been wondering why we've been doing so well in the portal in both football and basket ball while furd has not. The timing of the new chancellor is fortuitous, right when we need to pivot again. He drinks the kool-aid, he was at The Play, and he is a fan of the capitalism behind both academia, such as CRISPR, and athletics.
NIL?
Name image and likeness, which essentially allows student athletes to be compensated. More details outlined here https://en.m.wikipedia.org/wiki/Student_athlete_compensation
Thank you.
Another insightful, well-reasoned article and good cause for optimism.
Another upside, here. may be the default inheritance of the undisputed title of The Best East Bay Professional Football team.
Agreed! These guys take the mystery out of meat loaf.
It would be nice to somehow get Legends under the UC umbrella enough to make donations tax exempt. But Legends worked precisely because it was MANDATED to stay clear of the bureaucracy that always has some rule or policy that makes the smart or efficient thing impossible. I think having the money earmarked actually helps insulate it.
I think Lyons is the right Chancellor to manage this transition. I just hope he can. I'm not a pessimist but a realist who recognizes the challenge.
IMO if they are smart they will let the guys running the NIL collective have a big hand in handling the upcoming financial changes. It's pretty clear the donors trust them more than Knowlton and the existing administration.
Hear, hear. Maybe the athlete's salary could be the new NIL and, I would hope, that could carve out a tax-exempt niche, but remain semi-autonomous.
It’s impossible not to be pessimistic about even our desire to confront this new landscape. And yet even Drake, Knowlton and Christ could see this coming from a mile away and we’re largely paying our way into the ACC. Which says to me someone did the math and valuations and they have determined there’s still value in pay to play athletics.
I also suspect that no one wants to preside over the demise of a pretty prestigious athletic program (not so much in the revenue sports, but overall).