In light of a recent, somewhat emotional thread here, I stumbled across
this AP story I thought the list might find interesting to read.
MADISON, Wis.
The University of Wisconsin is ready to sign a contract giving a
Missouri-based company the exclusive marketing rights to Badgers' sports
through 2019 in exchange for guaranteed payments of $76 million.
The contract, to be considered by the Board of Regents this week, calls
for Learfield Communications, Inc. to continue managing television and
radio shows for Badgers' coaches and play-by-play radio broadcasts for
football, men's and women's basketball and hockey.
The company, whose Madison-based staff operates as Badger Sports
Properties, also will handle marketing, including game-day programs,
special events, sales to corporate sponsors and Web site advertising.
One sports marketing expert said Monday that many universities are
signing similar deals but Wisconsin's may be among the most lucrative.
"That would seem like one of the bigger numbers I've seen out there,"
said David Carter, executive director of the University of Southern
California's Sports Business Institute.
Annual payments to UW would start at $4.9 million and gradually increase
to $7.48 million in the final year of the contract.
The deal would replace a 7-year, $30 million agreement that runs through
2009.
The increase in revenue will help pay the salary of Badgers' football
coach Bret Bielema, who signed a five-year, $7.5 million contract
earlier this year after a stellar rookie season. Bielema's contract
calls for $5.5 million of his pay to come from Learfield's payments.
UW picked Learfield in 2002 over five other companies in a competitive
bidding process. The school previously split up media rights and handled
marketing itself, but it says consolidating them has increased revenue
and marketing opportunities.
Learfield proposed the 10-year extension last year and UW officials have
recommended accepting the deal, saying it compares favorably with other
universities' contracts.
Mike Behymer, senior vice president of Learfield Sports, called the
contract "an aggressive opportunity for the university." He declined
further comment until it is approved.
Learfield would get the rights to distribute the programming, sell
advertising during shows, games and on the athletic department's Web
site and to secure corporate sponsorships.
Many universities are outsourcing their marketing to stabilize their
budgets at a time when coaches' salaries are increasing, Carter said. He
noted Wisconsin has one of the largest athletics budgets, about $80
million, in the country.
The agreements are becoming more popular because they mean universities
do not have to spend money and hire staff themselves, Carter said.
"It's a business decision made by these universities," he said. "I think
it adds a measure of certainty and it takes any financial risk out of
the equation."
At least a handful of other universities have long-term marketing
agreements comparable to UW's proposal. That includes Tennessee, which
signed a 10-year, $83.4 million deal with Host Communications last year.
Wisconsin's extensive, 47-page agreement throws in some additional
sweeteners. Learfield would pay an extension bonus of $1 million,
$750,000 to install new signs at the Kohl Center and Camp Randall and
donate $25,000 per year to endow a journalism scholarship.
The deal calls for the company to provide what UW calls a significant
amount of free radio and television advertising for Badgers' sports.
The regents' business, finance and audit committee is scheduled to
review the proposal Thursday during a meeting at UW-Oshkosh. The full
board could approve it on Friday.
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