Revenues & Expenses of OSU


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  The problem is that college athletes mainly dominate Division 1 basketball of football player are being poorly compensated for their services. For this post I will look at this situation from a business perspective. For this example I will be using the revenues and expenses of the 2011-2012 season from The Ohio State football program.
The current thinking is that athletes are fairly compensated. Athletes are required to put in approximately 50-60 hours in-season and -15-25 hours out of season; this is a year round time commitment with only a few weeks off in the entire year. In return for their services these athletes receive grant-in-aid (scholarship) for tuition, room, board, and books.

From the website http://businessofcollegesports.com/tag/ohio-state-university/ there is a chart showing the revenues and expenses of The Ohio State football program. The football program generated $ 48.7 million in revenue. With a number of different expenses the program also had $13 million in expenses. This left a profit of $35.7 million. The largest expense of $3.7 million is A & P which accounts for the yearly salaries for the coaches. There are three expenses that go directly to the football players which are meals $0.46 million, lodging $0.22 million, and grant-in-aid of $3.4 altogether totaling approximately $4.1 million. I must also mention the $3.4 million in grant-in-aid is paid right back to the University. Using these numbers of the $48.7 million dollars of revenue generated 8.4% goes back to the athletes and of that 8.4%, 82.9% of that goes right back to the University as the price of tuition room, board, and books.

The current thinking is that athletes are being fairly compensated, but from the information that I just showed I think it presents the argument that these athletes are not being fairly compensated. These athletes only receive 8.4% of the $ 48.7 million in revenue, and 82.9% of that goes right back to the University. Also these athletes are not considered employees and therefore cannot receive workers compensation for their injuries after their time at the college.

This information seems to be pretty reliable. I wouldn’t think that this website would just make up numbers for the revenues and expenses. I checked other sources and found that the revenues for The Ohio State football team for the 2011-2012 season were constantly around 50 million.

Source – http://businessofcollegesports.com/tag/ohio-state-university/

 

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2 thoughts on “Revenues & Expenses of OSU

  1. Good idea to double check the figures.

    Who or what is the website that provided it? Where did they get their information? As it is a state university, it is surely public data.

    I glanced at site, and I don’t see obviously where the author got the information.

    More importantly, I suspect you can find more thorough and systematic analyses of the costs and revenue of Division 1 athletics. It is interesting to look at one, but ultimately, you are addressing the whole field of Division 1, not just one university.

    I am not an expert on higher education accounting, but I have a hunch that there can be quite a bit of “wiggle room” to define various categories one way or another due to a variety of factors including the internal complexity of these large institutions, the fact that they are accountable to a board of trustees and also state governments (usually. Are there Div 1 that are private? Maybe in basketball like Stanford, or oh yeah Bucknell. But in football?), and finally, internal politics.

    For example, the author of your post points out that the cost of academic remedial services is costed to athletics. Ok. But is that right? I mean the university is about education. If other, non-athlete students need tutoring, the university doesn’t try to get some other internal unity to cover the costs. My point is that these kinds of budgets are about accounting, but they also probably reflect a history of internal politics to the organization.

  2. Ok, this is not really what I mean by a business source.

    A business would be what the NFL says about paying college athletes. Or the NBA. Or Nike. Or Riddel…

    OSU is not technically a business.

    However, at the same time, you want to make the point that it _is_. There is our conundrum.

    I would like you to keep using NCAA sources, of course, as well as others. Still, I would be that teams, leagues, or individual owners, who are more clearly for-profit organizations, have an opinion on the topic. Find them.

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