Football and Finance Tie the Knot (Opinion)

It’s been more than three years since a career detour turned a longtime sportswriter into a business reporter. Or, perhaps more appropriately in this instance, it’s been four football seasons.

The best advice received at the time was this: Writing about business is a lot like writing about sports. The biggest difference is you’re just keeping score with money instead of points.

That’s largely proved to be true, and it’s been a rewarding experience to learn a lot about the business world in a relatively short amount of time. The ironic thing, though, is how much more intertwined the sports and business worlds seem to have become over the last three-plus years.

There have been no better reminders of that than the ongoing goings-on with the University of Arkansas football program, and the spate of bowl games that will culminate with a national championship contest that coincides with the date of this issue. For better, for worse, football and finance have tied the knot.

For anyone in need of a quick refresher, the UA’s new football coach, Bret Bielema, will be paid $3.2 million a year to coach the Razorbacks. The salary pool for his assistants will be somewhere in that same neighborhood, too.

The 35 bowl games played over the last several weeks, meanwhile, will pay out more than $260 million, according to multiple published projections. And if you think that’s a lot, just wait until the new playoff system kicks off in time for the 2014 season.

According to USA TODAY (and former Arkansas Democrat-Gazette) reporter George Schroeder, the annual average revenue for the new postseason system will top $500 million. Throw in the billion-dollar TV deals networks now are giving conferences to broadcast their games, and $3.2 million for a head coach doesn’t sound quite so outrageous.

Some people, of course, never will understand so much money changing hands over football games. Arkansas Business editor Gwen Moritz recently counted herself as part of that camp in an interesting piece that pointed out Bielema’s salary is the equivalent of 80 years of work for the median Arkansas household. Framed in that context, things do seem out of whack.

Forbes contributor — and sports agent — Leigh Steinberg, however, sees it differently. In an equally interesting piece, Steinberg recently justified current coaching salaries by tying them to their associated pressures, the impact of athletics on alumni giving and the aforementioned TV deals, among other things.

It’s also interesting to note Forbes recently valued Arkansas’ football team at $83 million, a top-10 ranking that puts it ahead of notable programs like Oklahoma, Oregon and Ohio State. That value is based on the evaluation of the program’s financial impact in four areas: the revenue directed toward university programs and spending (including football scholarships), the football revenue used to support other athletic programs, the distribution of bowl revenues among conference teams and the economic impact of visiting fans for home games.

Forbes also reported Arkansas’ football revenue as $64.2 million. For perspective, that means the football program would’ve ranked in the top 20 on the Northwest Arkansas Business Journal’s most recent list of largest private companies — smack between Carco Capital Inc. of Fort Smith and Springdale-based Multi-Craft Contractors Inc.

In other words, the Razorbacks football team largely is responsible for the fact Arkansas remains a financially self-supporting athletic program. That’s according not just to a statement given by UA athletic director Jeff Long, but a 2011 report compiled by USA TODAY.

So, is a football coach really worth $3.2 million a year? Should football programs be paid $18 million for appearing in the best bowl games?

Those questions are hard to answer, sort of like these: Is Tom Cruise worth the $75 million Forbes says he made between May 2011 and May 2012? Should Kanye West and Kim Kardashian be paid as much $3 million for the first images of their offspring, as a source told The Huffington Post?

In sports or business, the best answer seems to be to let the market decide.