The Guru Matt James wrote:
All the talk about athletic departments losing money are missing a HUGE part of the picture. The point of sports like football and basketball aren't just to raise money directly, but also to help market the school.
Butler estimated their two tournament runs to be worth $500 million in free marketing.
Nobody on the east coast would have heard of Boise State or Gonzaga, but thanks to recent success, they are on the radar of many more students, some of which will contribute academically to the school...
Having a former career in accounting, this is something I've been saying for years...that when you see stats that X school made or lost $Y on their football or basketball program or athletics in general, that the accounting to get to that number is incredibly fuzzy. At least to anything I've ever seen it is. I'm entertained when a school publishes how much they "made" or "lost" on a team or athletics in general, but that are not numbers I trust at all.
Schools that look at their outlay towards athletics as part of their overall marketing budget are the ones that to me get it right. Not all schools need to do this kind of marketing. The schools noted above are excellent examples, they were not well known (IMO) until they started having athletic success that got them on network tv and the ESPN ticker and Sports Center. Given our culture, I would say that having a successful athletics program is one of the most efficient ways to get your name out nationally to the most number of people. Certain schools don't really need to do that, for example who hasn't heard of Harvard, Yale, and who wouldn't assume that all states have large universities.
I've gone so far as to say that outside the core academic departments really anything a college offers whether it be athletics or drama or music or a robust fraternity/sorority scene all should exist primarily as a way to market that school to potential customers. Many colleges may value athletics, especially for non-revenue producing teams, as part of their educational mission and I'm all in favor of that. But when it gets right down to it, spending money to fund an athletic department (or a drama program or a school newspaper...you name it) only makes sense financially if you can use it to attract students.