There Is No Jerryworld Pot Of Gold Comment Count

Brian April 23rd, 2012 at 9:02 AM


Dave Brandon, Jerry Jones, and two weird old guys. Unless I've got that wrong.

A lot of people are pretty mad that Michigan's band is not going to Alabama. So many people are mad that there is a backlash against the mad people. The strength of the reaction is a combination of a number of things, amongst them the sudden reversal, how bush-league we look in comparison to Alabama, and the growing feeling that maybe this wasn't such a coup after all.

Remember back when this thing was scheduled and we were assured that the take from this was going to be epic? Back then, I thought it was a good idea because it seemed impossible for Michigan to schedule a real nonconference opponent in any other way. This came paired with rending of garments about that fact, how college football is broken, etc., but the fact remained that 2012 would be the first season in a long time in which two nonconference games would be against truly interesting opponents. It was the only way.

That assumption has steadily eroded as we find out more and more details and observe Big Ten scheduling trends in general. The conference announced a scheduling alliance with the Pac-12 that will force every league member to undertake regular home-and-home matchups against comparable opponents, no neutral site funny stuff (or at least not much). Michigan State jumped the gun on that agreement to schedule Oregon to a home-and-home. The year after that series finishes, the Spartans will take on Alabama in a home-and-home, in years when they also play Notre Dame. It can be done. Michigan just didn't do it.

As for our Alabama game, Michigan's announced take, $4.7 million, is so low it seems impossible it's correct. If that's all Michigan's getting from the game that's at best equivalent to playing a body-bag game at Michigan Stadium. Assuming random one-off opponent cost a million bucks, Michigan would match 4.7 million in gate receipts alone by charging an average of 52 bucks a ticket.

Michigan's 2011 budget shows $41.3 million for last year's eight-game home season in pure ticket costs minus guarantees, $8.7 million in PSDs, and $13 million in premium seating donations. Everything included, the average price paid for a seat at a Michigan game last year was about 72 dollars. Without all the donations, it was $49 last year; ticket prices increased by an average of $4.64 this year. $4.7 million is about 300k less than they'd get from a home game on ticket face value alone.

Add in Michigan's expenses for getting down to Dallas and the ancillary benefits of having a home game (parking and concessions seem to be around 300k per game and there would be some level of increased donations required to get a season ticket) and either $4.7 million is undershooting it by a lot or Dave Brandon sold a home game to Dallas for no financial benefit whatsoever. Meanwhile, tickets for Dallas start at $125. At that price Michigan could easily afford a home and home with a high-quality opponent.

Surely this can't be right. Dave Brandon didn't send Michigan down to Dallas for no reason whatsoever, right? My previous belief was that there was something we were missing in the numbers. But the sudden about-face about the band—and it was an about face given the contract and the conspicuous "Michigan band" sections on seating charts—suggests that the financial picture could be as grim as that: $400k is a significant chunk when you're already getting hosed backwards and forwards.

I finally took a close look at the contract. We are getting hosed backwards and forwards. Check it:

CSLP will … pay $4,700,000 to Michigan. The team acknowledges that the Team Guarantee constitutes the sole financial compensation for the Team for playing the Game, and that no other compensation will be due or owed to the Team under this Agreement in connection with the Game. … The parties acknowledge that the Team may be entitled to compensation from its conference related to broadcast of the game. CSLP … will … retain all other revenues from the game. CSLP and ESPN acknowledge and agree that (a) all rights to telecast of distribute the programs of the Games have been assigned by Michigan to the Big Ten (b) Michigan has no ability to grant to ESPN any rights for telecast or distribution of Games played pursuant to this agreement and c) as between Michigan and ESPN, ESPN is responsible for obtaining such rights from the Big Ten. Notwithstanding the forgoing, if ESPN has the broadcast rights [they can get a title sponsor, etc.]

The TV point is important: my Big Theory for why this makes sense is that the teams would get the TV rights to themselves because the game is outside of their conference footprints. That's not the case. The money Michigan gets from television will be split twelve ways—every extra dollar they make for playing a big time opponent also goes to OSU.

Michigan gets a couple hundred tickets, a couple suites, seating for the band, a field-level "party suite" and right to purchase 500 tickets near it, and 100 parking passes. Cheerleaders get in free. They get one "official retailer" in the stadium that CSLP takes a 22% of the gross of. So that's nothing. An addendum makes it clear that "hotel rooms, and other costs of transportation and lodging, shall be at the cost and expense of the individual institutions." Even the police escorts are at the respective teams' expense.

The only thing that could possibly redeem this is if the Michigan got the revenue from the uber-expensive tickets, but the contract makes it clear they don't:

CSLP shall also provide a minimum of 25,000 tickets for Michgian to re-sell to its fans as specified on the stadium map as an addendum to this document.

Michigan got no more money than they would for an average regular season game and is charging their fans 60% more (at a minimum!) to attend it. There is no way to read the contract other than this: Dave Brandon got ripped off.

So when Dave Ablauf tells that they're treating Dallas like "any other road game," it's because they have to. This supposed financial windfall simply does not exist. At best it's a break-even proposition even without the band. They will probably make more against Air Force the next week. Michigan gets a "bowl game experience" in an NFL stadium without its band at "neutral site" Michigan is twice as far away from as Alabama. Meanwhile, Mark Hollis gets Alabama at home. Michigan got owned by Mark "people u is" Hollis.

You can consider the future created, yo.

BONUS: I hope this came from Brandon.

MT @sbell021 Game announced 2 months before Hoke hire. RT @schadjoe Brandon asked Hoke if he'd like to play Alabama and Hoke said "Why not?"


Silly Goose

April 23rd, 2012 at 9:55 AM ^

Also some other things to consider. The bridge over stadium is out, so there may have been a desire to limit the number of home games this year due to traffic concerns/skip the first week of the season all together due to where the project will be at. Also, the profit of every home and home game must be divided by two, because the year you are away you make nothing. So this game plus another cheap opponent at home next year still brings in more money than a home and home with Alabama.

Ivan Karamazov

April 23rd, 2012 at 12:16 PM ^

I doubt the bridge concern would factor into the decision to schedule so few home games.  If you play the game we will come even if it takes an extra hour to get around the city.

Also it looks like the bridge is coming along nicely especially with the mild winter we had.

EDIT: Nvm its ahead of schedule but not enough to matter


April 23rd, 2012 at 9:59 AM ^

I diagree, but I want to get some feedback in case I'm not doing the math right. So if you do a home and home game you obviously get your home game and the pot of gold that accompanies it. With the ticket price increase and just kind of estimating concessions and merchandise let's say that comes to $6 million, and then you play your away game and the other team gets that same thing and they get their pot of gold and you both go on your merry way. By playing a neutral site game such as this you avoid playing the away portion of this arrangement. In each case, you pay once for your team and staff and such to travel, so we can assume the difference in costs is negligible, so let's just take the $4.7 million as a stand alone figure.

So on the one hand, you have your neutral site game at $4.7 million plus by not having the away game in return you get another home game for $6 million, so your total payoff is $10.7 million. While with a home and home, your total payoff is $6 million. At least from a financial standpoint, doesn't this allow you to increase revenue?


April 23rd, 2012 at 10:02 AM ^

All home games are not created equal. Just taking your numbers lets assume that a game against Central nets Michigan 6 million. Let's say that we play Bama at home and tickets are $100 instead of $50 - that's the part that you're missing in your math. Let's assume that M plays Bama and 2 tomato cans (and ND home and Home) and here's what you get:

Year 1 OOC: $4.7M+6+6 = $16.7M

Year 2 OOC: 6+6+6+8(ND) = $26M

Total: 42.7M

Year 1 H&H: $12 (Double ticket price) +6+6 = 24M

Year 2 H&H: 6+6+8(ND) = 20M

total: 44M


April 23rd, 2012 at 10:25 AM ^

The vast majority of tickets in the Stadium are season tickets.  They may have a face value of more, but when they're paid they all equal out to the same amount per game. They're paying that no matter what.  So that's a fixed amount. The amount of games that are really "charging more for this game than Eastern Michigan", i.e. individual tickets, is a small percentage of the total ones in the Stadium, so with a little fluctuation, you're making basically the same amount per game.


April 23rd, 2012 at 10:39 AM ^

Is not realistic. A lot of the tickets sold are not individual game, and a significant chunk of tickets are student tickets which cost less. I dont think you are ever going to double your revenue year to on a single game. A bama home game would match UTL is my guess.


April 23rd, 2012 at 10:14 AM ^

I haven't bought a ticket.  But Brian is looking at it in a simplistic view. He's taking into account the profits from concessions and all that, but discounting the costs of running a home game. Certainly there's more profit to be made in a home game rather than a road game, because there are, well, profits. But if you can get paid like a home game and have almost none of the expenses, that's a good thing.  Yes you don't get concessions and such.  But you don't have to pay for expenses like staffing the Stadium and press box, security, payoffs to the city for police, power, maintenance,  etc., etc., etc. And you have to pay another team to come play you (rather than have them paid by someone else); what's the going MACrific rate, half a million? And almost all the team expenses exist whether you play at home or on the road.  Hotel, feeding them, police escort, buses to the game. 

What it seems to come down to is this:

Is airfare > costs of home game - concession-type profit?  I'd guess it works out pretty well.  I mean, assuming Alabama got paid a similar amount (and LSU and Oregon before that) are we now saying that FOUR athletic departments got taken to the cleaners, and the first two didn't learn from the previous two? Unless we're just getting paid far less than everyone else, in which case "BAD BRANDON", but I have a hard time believing that.

There are a lot of ways this game sucks five ways to Sunday, but I'm not sure "we're not getting paid enough" is high on that list.

Section 1

April 23rd, 2012 at 10:32 AM ^

What Brian wrote was mostly brilliant, but this:

As for our Alabama game, Michigan's announced take, $4.7 million, is so low it seems impossible it's correct. If that's all Michigan's getting from the game that's at best equivalent to playing a body-bag game at Michigan Stadium. Assuming random one-off opponent cost a million bucks, Michigan would match 4.7 million in gate receipts alone by charging an average of 52 bucks a ticket.  

can't be correct.  Yes, Michigan rakes in more than $4m for a home game.  But out of that gross revenue, out of conference opponents get a share.  Alabama would get a sizable share in coming to Ann Arbor; we'd get a sizable share going there.

I think I agree with Brian as far as he got up to that point, but M-Wolverine has it right on "revenue-minus-opponent's share-minus stadium expenses-plus concession revenues."

The one-off deal with Alabama, once rumored to be a $ windfall for us, seems to be just a wash.  And cutting costs as with the band's travel expenses really does just seem to highlight it.


April 23rd, 2012 at 10:47 AM ^

It might be a little bit of a loss. It might be a little bit of a profit too.

I think what can't be said is we're absolutely getting taken to the cleaners by this deal.  And it's probably equally fair for you, Brian, or anyone else to ask "if we're not making THAT much profit of it off of it, is it worth a home game vs....well, anybody?"  And then someone can weight the value of playing Alabama somewhere else vs. Army or someone here.  And could come out on either side fairly reasonably. 

The one thing that doesn't work is comparing MSU. Financially it's the same thing; competitively, perception-wise at least, it's not.  Someone like Bama or Oregon is looking at MSU at a road game that will give them some pub and look good in the polls, but they're not worried about losing at all (whether that's accurate as good as the Spartans have gotten isn't the point). And in MSU's case, they're still the up and comer who wants to show they can hang with the big boys, and a win vaults them nationally. So it's worth the risk.  It can be done...but most times when Ohio State or someone does it they don't have ND on the schedule each year; which runs one back to the old "should we play ND every year" thing...but that's even more OT.  But Bama and Oregon aren't playing any other big OOC games in the years they're playing MSU; and MSU actually isn't playing ND the years they're playing Oregon (though they are playing West Virginia one year).


April 23rd, 2012 at 9:57 AM ^

It's not about the Benjamins, it's about the brand and the marketing exposure. If he's breaking even and geting all the exposure/BS that comes with it, that's coming out ahead in DB's mind.


April 23rd, 2012 at 11:53 AM ^

I think he wanted a showcase for this particular season, as part of a "Michigan is back" campaign. When this contract was made before RR's 3rd year, it was assumed that this would be the point that the spread and shred would be humming at full speed, with recruiting classes made entirely of RR recruits. While he probably could have negotiated a home and home with Alabama, he almost certainly couldn't have scheduled such a game, given the way scheduling works, for 2012.


April 23rd, 2012 at 9:59 AM ^

One worthwhile question not asked here is, "how does this compare to the value of a home and home over two years?" It may be that Jerryworld 2012 + body bag 2013 > home and home. But then again, if you're valuing national exposure, a home and home gives more than that (probably not twice as much, but definitely more). Point is, this game does indeed look less like a slam dunk - the payoff seems like a bowl game, except that we are losing the revenue of a home game to go to it.


April 23rd, 2012 at 10:01 AM ^

I think you have to look at this game in the scope of 2 years, not 1. If Michigan were to play Alabama without the neutral site it would have to be a home and home series. So while one year they would make 7 million, the other year they would make nothing and have to spend the same amount now that they are paying to go to Texas. With the neutral site game, they get to make 4.7 million while losing a home game, but make 6 million next year after the 1 million payout to get directional Michigan to come in and get beaten up. I hate to side with Brandon here, but this setup does give the big time match up at a much lower cost. Not that I think everything should come down to cost.

And with a home and home, the band wouldn't have traveled either.


April 23rd, 2012 at 12:54 PM ^

Yeah this game is fine in terms of the money. It will be over $4.7 million even after expenses with TV rights and all that. TV rights were negotiated seperately here don't forget and probably for a monster fee. This is going to get you a bigger tv payday than a normal road game even after the conference split.

Home and home would probably come out about the same or likely worse, because as has been pointed out, one year going on the road you'd play for basically nothing offsetting the huge profits of the home game.

Plus in a neutral site game, I'll bet the University has way more ability to charge a premium for more seats than they could at Michigan Stadium, where everything is already pre-sold in a package. So there is yet another profit center.

Next year you'll add in another home game against tender meat which would net you about the same as having Bama come north.

The real issue with Brandon is him deciding not to bring the band. This game is for the players and future players and it sends entirely the wront message to short change the experience.


April 23rd, 2012 at 10:03 AM ^

I'm not saying I agree with the decision Brandon made, but as another poster said above, IMO the key to his thinking on this game has nothing to do with making a profit. While he would love one, and probably did get out-negotiated by Jerry, Brandon is thinking roughly this, "this game against Bama will be by far the biggest game of the week, and as the kickoff game for the year and a national game, the Michigan Brand will be exposed to the country in a very favorable way. This will help raise our profile for recruits, fans nationally, and in the media. That exposure is worth simply breaking even for one game."

As a marketing guy myself, i can tell you that this is the way we think. Now, if it was me, I'd try to get a home and home, thinking I could get much of the same benefit and make more money doing so, while also benefitting my local fan base. That's where I fault Brandon, not for breaking even here.

matty blue

April 23rd, 2012 at 10:02 AM ^

i had such high hopes.  a bo guy, a former player, an apparent financial / marketing whiz...but at this point my list for brandon is as follows:  pro - hired brady hoke.  con - just about everything else.

i mean, seriously.  how, exactly, is he any different than tom goss?  starting points were different - goss took over with the athletic department in some financial difficulties and wasn't able to fix it.  brandon took over a department flush with cash and has apparently kept that going (although i believe that his chase of every single dollar will eventually turn off some portion of the fan base and drive dollars away in the long run).

goss' big mistake was the 'halo'...i would submit that the football clown costumes are no different.  chickenshit gimmickry.


April 23rd, 2012 at 11:42 AM ^

Goss was a disaster.  Almost everything he did backfired.  He didn't "take over an athletic department with financial difficulties" - he caused the difficulties.  Among other lowlights, we went way over budget to expand the stadium and put in new scoreboards in 1998, got ripped off in a deal by Host Communications, fired Steve Fisher right before basketball season started (making it impossible to hire an outsider), hired Brian Ellerbe, broke a contract with Nike over sweatshops and then bought apparel from them anyway . . . it's a very long list.  The guy was fired after 2 1/2 years.  ADs don't get canned often.

I think Brandon did a poor job negotiating this deal, but on the whole his body of work is night and day from Goss's.


April 23rd, 2012 at 10:07 AM ^

I think that the analysis here is missing a few points. 

One, home games versus Alabamas have to be factored into two-game sets, one of which yields $0.  The real comparison is between a hypothetical $9.4 million (Jerry-world's $4.7 million doubled) against the value of a home-and-home.  The Jerryworld game has higher associated per-game travel costs, of course. 

Put another way, the line "sold a home game for no financial benefit whatsoever" is correct only if the home game is a MAC opponent.  If the point is to play a fellow big boy, then there was no "home game" to sell, at least not by itself. 

Two, games cost money to host.  Not a lot compared to the ticket price, but something.

Three, I'm not sure why donations are being factored in.  Is there some thought that Michigan is losing donations (even PSL "donations") as a result of the Jerryworld game?  That seems far-fetched. 

Four, the commenter's point above about the ESPN publicity machine is valid.  Not sure how much it is worth, but there is more than marginal publicity value to being ESPN's game rather than the comparable PSU-Alabama home and home mentioned.

Five, assuming that Michigan is able to resell the band tickets, rather than comp them to the band, the question is whether Michigan is better off placing the tickets in the hands of paying fans or in the hands of the band.  My personal calculus, like most non-administrator's, favors the band.  But it's not a sure thing that the band gets the seats rather than, say, season ticket holders.

As a season ticketholder who cannot go to Dallas, I'm as bummed about the game as anybody.  And I'm enough of a fuddyduddy to dislike the increased commercialization of any college sports, much less Brandon's Michigan trendline.  I'm just not buying this economic analysis. 


April 23rd, 2012 at 10:24 AM ^

I think you are right that Brian's analysis is flawed (Which I'm sure he'd admit), but both Michigan and Bama would kill the $9.4 million number in both their home games. Michigan also is not filling their schedule with a comparable game in 2013, so there is an opportunity there that lowers the 9.4 baseline a bit.

Maybe Bama was unwilling to do a home and home, but a Jerrydome game just seems like something Brandon would buy into as a great marketing opportunity.


April 23rd, 2012 at 10:33 AM ^

Let's say they make 10 mil at home vs. Bama. And zero the next year at Bama (it's really not make that much the first year, because you pay Bama, and then get it back the next year when you go down there, but for easy math...).  Here you make the 4.7 million at Neutral, then, say 9 million vs. Westeastern Tennessee St. in South Dakota next year. (Because you're still selling the majority of the tickets as season tickets. That's still more than a home and home. Now, you could play two teams that would come to your Stadium with no return visit for more money I'm guessing, but then we're back to the complaints that we don't play anyone interesting. Catch 22.


April 23rd, 2012 at 12:42 PM ^

One guy negged all my posts in the thread. I have my suspicions, but it doesn't really matter, because they're just points, and someone else just upvoted them back. And I don't really need them even if I could get them. People can still read it if they want to. It generally balances out in the end....


April 23rd, 2012 at 1:10 PM ^

I think you are dead-on. Bottom line, there is no discernible difference revenue wise between a home game against a power team and a home game against Eastern , but you don't have to give back a return trip to the Eastern caliber team.   With a home game, the TV is already negotiated way in advance, and the tickets are also sold way in advance. 

So by doing the neutral site, you offset the operational expenses of a home game with the travel expenses. You also get the ability to control ticket values in way you wouldn't get at home. Plus you negotiate a separate TV deal because it falls outside the conference contract. Yeah you have to split the money with the league, but you have to do that with every game. Here the pot will be larger.

This is clearly an economic win. It's a bowl game but probably with a way sweeter TV deal. If the paydays were large enough and it were possible logistically, the pure economics say to do 12 of these neutral games a year.

Now just take the band and all will be well with the world.



April 23rd, 2012 at 10:13 AM ^

Make-work Marketing Guy Brandon Hired: "Mr. Brandon! I've got this great idea! We totally need to play a regular season game at an NFL stadium! Look at these numbers on how much the NFL is growing. Plus, we won't be in competition with other games like we may be during bowl season. It will achieve our fan's requests to play a tougher schedule and we'll make more money because we won't have to play an away game the next year."

Brandon: "Yes. I do not see how anything you said could be wrong."

Here's how it breaks down. Brandon's got a chart chart! in his office that breaks down how much it costs to own Michigan Stadium. He has an expected value he MUST get out of the stadium every year, regardless of actual department revenues, to justify owning it. When he gives away home games, he sees a loss of ROI on Michigan Stadium, even IF the football program is actually bringing in more money.


April 23rd, 2012 at 10:18 AM ^

I guess I didn't realize that not sending our band was THAT big of a deal.  Then again, I'm not going to the game, so I probably wouldn't even notice the difference unless someone pointed it out to me.  That's probably what Dave Brandon was banking on.

But holy hell, can Brian be happy with anything?  We are playing Bama, fergodssake.  Maybe it's not the ideal scenario, but it sure beats playing CMU.


April 23rd, 2012 at 10:20 AM ^

the likelihood that alabama was asked to do a home and home with Michigan and both MSU and liked their chances on the road in east lansing better than they liked them in Ann Arbor?

Fort Wayne Blue

April 23rd, 2012 at 10:36 AM ^

if not for Brady Hoke, I would probably be really really really really mad at Brandon.

but bringing in Hoke (whether or not it was a huge, easy, slam dunk (w/Alumni football players, his connection w/Michigan, his track record as HC, & his love for Michigan)) makes it so, even when he does dumb stuff (like clowngate at the MSU game, mascot stuff, hashtag, Arbies, Bama in Dallas, the band not going to Dallas, the overnight decision about RR's job, App St rematch, etc. etc.) I can't hate him.

Brady poops rainbows that shine so bright that I can't even see the stupid poo poo that DB does.....



April 23rd, 2012 at 10:45 AM ^

Everyone here hates the guy for grabbing money and then hates on him when he doesnt grab enough. Instead he has booked our most high profile non-conference game in more than a decade. 

Did we ever consider that the money was ENOUGH to put Michigan on National TV, opening weekend at a great venue for Football? I know it isnt the big house, but it is still going to be great.


April 23rd, 2012 at 12:44 PM ^

Sorry, but I would rather have a national TV game in a college stadium.  Or at least a stadium that is in an area full of M alums.  It is simply going to be far too expensive to go to Dallas and I was someone who was (is) chomping at the bit to make a road trip for an away game to a new stadium outside the Big Ten.  East coast, mid-atlantic, chicago, all would have been awesome. 

What if we had split the travel distance and done this in Nashville?!?!  That would have been an epic weekend.  That's a location that me and my recent alum friends would have flocked to, tickets or not.  Instead, Dave Brandon's corporate friends get to hang out in Jerry Jones' play house. 

Home-and-home >>>>>>> Jerryworld.  Don't care about the money or the "national attention."  Reward your customers, your alums, your fans.  That's where the money comes from, afterall.


April 23rd, 2012 at 2:41 PM ^

I think your response almost touches on the main unspoken issue most people have avoided saying so far: 

You want to go to this game and you can't. 

That is a valid sentiment.  But all the complaining is really trying to cover the feeling of Michigan fans in Michigan being hurt they won't get to go to the biggest OOC game in a long time. 

When you look at the demographic shifts (which became very public during the B1G expansion discussion) there is a great benefit to expanding your exposure into southern geographies. 

This game meets all those criteria:

1) Southern location (Dallas, TX)

2) Local presence in a large populous area (Dallas, Ft Worth, Houston, Austin, San Antonio) well over 15 million people in that geographic footprint alone.

3) The rich talent that geographic footprint provides.

4) Primary focus of the nation for one evening. What people fail to realize: Jerry Jones is going to have a high profile game that night with or without Michigan & Alabama. You can either BE the high profile game or compete with one.  I would rather Michigan be the only one.

Again, I understand the hurt feelings about not being able to go, but there are many good things about this game for the long term health of the Michigan football team.


April 23rd, 2012 at 10:47 AM ^

contribution to the debate. Congratulations. If major media don't pick up on this they are idiots. Well, they will still be idiots, but they should pick up on this. Let's see if they do.

Btw, people f up, that's part of life. But let's hope the AD and admin learn from this. 


April 23rd, 2012 at 10:49 AM ^

I've read the short paragraph regarding "reselling" the 25,000 tickets provided over and over again, and I don't think it's at all clear where that money is going.  Is UM buying them from the promoter, and then reselling them at a higher rate?  It's not clear.