This week we had the honor to interview again Dr. Ron Dick, associate professor of sports marketing at Duquesne University in the school of business. Ron also worked for 20 years in sports, including 15 years in the NBA with the Sixers and the Nets, and then four years in the NCAA.
📝Show Notes: Through this interview, we touched on Tom Brady’s return, the beginning of the MLB season, March Madness, the NCAA College Transfer Portal, and then the fact that the F1 is coming to Las Vegas in 2023.
🚀Best Quotes: Here’s some of the key discussion points and best quotes from our conversation with Ron:
On Tom Brady coming out of retirement and returning to the Buccaneers.
“The first thing I'd say is Tom Brady spent some time at home and probably was coming off, without question, of one of his best years ever as a player, and he likely had some remorse. He thought maybe "I have more left in the tank. Joe Montana, another Hall of Fame quarterback who played with the Chiefs toward the end of his career, obviously known for his great success with the 49ers, told him, "You've got to play until you've got nothing left. If not, you'll regret it." That was one of the things Joe Montana said. So him coming out of retirement, I'm not overly surprised by that. I don't think he wanted to go out on a high note, as far as having one of his best years. I mean, I don't know why he couldn't replicate that again. As far as Todd Bowles becoming the head coach, well Todd Bowles is very qualified. He's been a head coach in the NFL”.
On the MLB and the MLB Player Association striking a new collective bargaining agreement that ended the owner initiated lockout at 99 days:
“I think they both gave some concessions and I think they were both just smart enough to realize that the demand for the sport could not survive a major lockout, like not having a season, like we did not have a world series playoffs in '94. And cooler heads prevailed. So I think the owners got no salary floor, which they don't want to have a salary floor, certainly a team like the Pirates don't want to have a salary floor; they still need the three years of service. So they have that manipulation of the service time still in place. And there is a luxury tax that goes over, that tries to help some of the teams that don't have as quite much revenue as some of the other teams, primarily through television”.
“The players have a minimum salary now of $700,000. And four years from now, that will continue to have bumps all the way up to $780,000. So the minimum salary will be $780,000 per year. There is no salary cap, which is good. The designated hitter is in place, which is good too. But whenever billionaires take on millionaires, normally the millionaires lose. So I think the players struck the best deal they could have. Both sides gave up enough and they're going to play 162-games. They're going to have to do some, sort of double headers and things to get that in by early October. And we're just going to kick off the season a little bit later, by about a week. And I think you've seen this mad rush to get everybody signed, and players are signing left and right as we speak. It was a really tight window, the ones that didn't sign in November. And I'm thrilled. I think it's great that we're going to have a baseball season”.
On who is going to win the NCAA title this year:
“I think Kansas is going to win it. If I had to pick one team and my life depended on it, I would pick Kansas. But I certainly think any one of the four teams, true blue bloods and great teams in the past. So I would say, if I had to guess, I would guess Kansas”.
On the situation with the NCAA right now:
“There's so much else going on with that right now that's worth mentioning. The NCAA did not have March Madness in 2020. And let's be clear about this, March Madness, the television ratings deal, the money they get from that, from CBS, TBS, TNT, and truTV help pay the operating budget for all the other sports, male and female's sports. So you're looking at the operating budget needing that revenue. So that really hurt Indianapolis in the NCAA when that didn't happen. So this money will pay for all what we sometimes call non-revenue producing sports, or Olympic sports”.
“And the other thing that happened is the St. Peter's story. As we see the bigger conferences, all of a sudden, the SCC with all the deep pockets of the football, they're planting players in the NFL more so than any other conference, the SCC. So now that has carried over to basketball. And now the basketball teams, I think they set the record for the most amount of teams that made the NCAA tournament in SCC history was this year right now in 2022”.
“So the revenue is split up amongst all the teams in the conference. So you'll notice that a lot of the teams don't play each other from the same conference until we get to the Sweet 16 or the Elite 8, or to the final four. And that's all by design, because they want to maximize the units that you get paid. So this St Peter's situation where you're looking at a school in the MMAC with 10 other schools, and there's two different MACs”.
“This one is the MAAC, as opposed to the MAC from Ohio and Michigan and Indiana. This one, they made $6 million additional to the MAC because they got to the Elite 8. So normally, one unit or one share is worth $334,000. But in this case, there was an additional $100,000 per six years to each team, times 10 teams. So that's $6 million. What does this do to a university like St. Peter's? Now St. Peter's has less than 2,200 students. So it's a smaller school. And now you say, how much more money did St Peter's get then? They get 5% to 10% more money than every other team in the conference. So it's very much structured like your European model, where everybody, when the tide comes in, all the ships go up, just not St Peter's ship. And they really need that revenue”.
On the fact that many US universities won’t be able to survive in the coming years:
“We have a lot going on in higher education. Some people are aware of it, some people aren't. But there's less children in 11th grade than 12th. There's less children in 10th than 11th. There's less students in 9th than 10th. In 2025, which all of a sudden is not that far away, there's an absolute cliff. And then it declines, and then 2031, 9 years from now, there's another cliff, and that's the new normal. So you'll see a lot of universities close. We don't need to construct more universities. We need to deconstruct them. We like them in our community, like we like hospitals, like we like universities, but the pie is getting smaller coming out of high school. That's where we get all of our clients, so it's getting very competitive right now. Any school out there that has less than $7 million endowment and less than 1,500 students, they will not make it. And that's just a known fact”.
On the NCAA College Transfer Portal,:
“There's roughly 354 Division I programs. Let's just think of Division I for the moment. Then there's 10 to 12 players on the team. So you're talking about around 4,000 players. And you can now transfer, if you're not happy with the school, the coach, with your playing time in particular, you can then put your name into the transfer portal. You can also take your name out of the transfer portal and stay with the team you're with. The coaches have contracts, and these contracts are not always honored when they get offered to go to another school. Unlike the NBA, where if one coach is under contract with a team, you're not allowed to tamper with them. Well, that tampering happens all the time with coaches. So this is giving the flexibility to the player, where they don't have to sit out one year. Historically they had to sit out one year, if they identified another team that they want to transfer to”.
“So the fact that there's already 1,004, as of yesterday, people that are in the transfer portal, some might say that seems high. It kind of goes back to the AAU model. Whereas if I'm not the star on this AAU team, I'll just make up my own team, and then I'll be the star. So I like what Bonaventure does. They picked six or seven players and they play them each 30 minutes a game. And that way, we know we can keep these seven players happy and then the rest of the players probably will transfer, and then they do. So it certainly gives the student athlete more control over their future, which I think is a good thing. But it also leads to a lot of instability in these programs. It's almost like you have to re-recruit your team every single year”.
On the fact that the F1 grand prix is coming to Las Vegas in 2023.:
“They've got lots of land there. It's a city that in 1983 had 400,000 of it, people live in it. And now it's up over 2 million, and it's just growing and growing and growing out into the sand. I mean the fact that we have a football team there, we have a hockey team there, why wouldn't other events come there? And they've got plenty of room to still build a really nice track out of the city a little bit (..) Why wouldn't they? It's a great destination”.
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