STREAM ON WITH JIM WILLIAMS - The state of college sports and streaming with Andrew S. Zimbalist

My guest Andrew S. Zimbalist is one of the foremost experts on the economics of college and professional sports. He is the Robert A. Woods Professor of Economics at Smith College. Andy is also serves as President of The Drake Group - an academic think tank working to better educate the U.S. Congress and higher education decision-makers about critical issues in intercollegiate athletics.


The groups mission is to ensure that the promise of college athletics is realized for all stakeholders For more on The Drake Group be sure to checkout their website https://www.thedrakegroup.org/

Also, Andy has written 28 books and you check them out at Amazon


Something to read for research Do Colleges Make Money From Athletics? | BestColleges http://bit.ly/3jae7W5

Cord cutters and cord nevers want a place to keep up with live TV with sports or news? Well, we have the best possible option at the best cost in the business. It doesn’t matter if you like sports, or news, or entertainment they have it all in one place at a price that will have you cutting the cord today! Check them out at https://www.sling.com/


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Episode Transcript

(00:34):
Everyone to welcome to this edition streamon. I'm Jim Williams your host.
Today. We're gonna talking about collegeand streaming. UM much has been in
the news recently. We know thatESPN Plus and has a very robust college
schedule on their streaming service with ofcourse, UM you done with the Southeastern

(01:00):
ofference, the ACCUM most recently withthe Big Twelve. Among the fact,
they also have a bunch of Nonpowerfive conference contests that they have on the
onim you know, on ESPN Plusthey also have the NHL, excuse me,
the NHL, the NBA, andMajor League Bachball and so I have

(01:23):
some NFBL contents on them too.So there's a ton of stuff on ESPN
Plus. So now that the BigTen deal is done, these Paramount plus
will be Guarrington content on the BigTen along with NBC using Peacock. Fox

(01:46):
doesn't have specifically sports stream situation yet. You know, there are deals that
could be made out there. There'sa lot of taught about where they might
go. UM. That leaves twoof the players who have been dipping their
toe in the water on the collegeside. That of course would be Apple

(02:09):
TV and Amazon. Both Apple TVand Amazon have been, you know,
ramping up their own professionals side,most recently for Apple Plus. Starting here
in it's on the fifth, twentyfifth February, they will begin their exclusive

(02:32):
their exclusive deal with Major League Soccerto be the distributor of all Major League
Soccer telecasts. They have fifteen linearbroadcast is going to be airing on Fox,
but an ESPN shows to take passline, so the primary distribution for the

(02:53):
MLS. It's the first network inNorth America to make a streaming service.
Their primary outlet will be at ApplePlus. And as I said before,
it starts to in fibrate. Weknow on the Amazon side that they have
done some heavy work with the NationalFootball League. They now are the home

(03:17):
Thursday ninth Football. They finished theirfirst season a couple of mixed messages.
In that first season, depending upon who you look at. Nielsen said
that they had a nine point twofive million people average watch. Amazon spoots
out a bit it says it's allcloser to eleven million. It's down,

(03:42):
of course from the linear broadcasts thatFox had of that same in that same
time slot. So that brings usto what we're talking about today, and
that is they are the PAC twelveis the only college Power five conference right

(04:06):
now that has a media deal overit. My friend and former colleague when
we both were at the Sports BusinessJournal, John Ryan, in his yearly
Predictions, said that Amazon would takethe plunge and be the primary in a

(04:32):
new PAC ten media Pack twelve sorrymedia deal. Now, that media deal
would also in some way, shapeor form, could have ESPN as a
partner, could have CBS as apartner doing the games in primetime on Saturday

(04:57):
night for football. But the realtakeaway here was that the it would in
frontist purposes of Pack twelve could verywell be the first Power five sports conference
to have a streamer as their primarycure one rights holding. That deal has

(05:24):
not yet come without commission choice todat Off working with his um partners into
conference to come up with the plantthat will be powerable to both Amazon in
the conference. Now, meanwhile,there's been a lot of shape thrown as

(05:54):
at the conference for you know,stumbling and bubbling their way through this.
Some of its fear you know,orn't criticized geargely our coughin four or five
different things. Yeah, it's fairchance to understanding. Much like professional sports

(06:14):
commissioners. Roger Goodell at Silver,Rob Manfred Gary Bettman, you know,
John Barber, all these guys youwork for the owners. It's not that
they make decisions on their own.They talk and work cop of the owners.
That's how the sports as this works, commissioners do. They're paid to

(06:41):
basically be the mouthpiece and the protectthe shield of whatever professional sports that they
represent. In college, you havecommissioners and they work with athletic purions.
However, they were for college presidents, and there's a whole different vibe between

(07:06):
college presidents and what they want andwhat is wanted or needed by the athletic
department. Now, obviously college presidentstake into consideration what athletic departments want,
but they don't necessarily have to necessarilyagree with does on. So there's a

(07:26):
lot of moving parts. Even onthe best of circumstances to do a sports
media deal. I've done many ofthem, both on the professional side with
professional teams that we've built a packageand developed that package, put that package
on the air, certain thing withcolleges. So, as I say,

(07:47):
under the best of circumstances, thesethings can take time, and they also
can be more than a bit ofa pain to pull off well, such
as not necessarily the case with what'swe know in the pack well at this
point, because it just lost UCLAand USC who are now headed out to

(08:13):
the Big Ten. I can honestlytell you in conversations have had them for
some Big Ten. There's no interestin them adding more teams. So if
you're in the PAC twelve and toworry about Washington and organ Stamford and tal
or whomever pick two or fourteen headingoff to the Big ten, it's that

(08:37):
Gold happened. It was a verydifficult decision for them in the Big Ten
to come to the realization that theywanted to invite um SC and UCLA to
become part of the of the confidencein large part because the Big Ten and
the PAC twelve in variations. ObviouslyI'm starting in the path we all wave

(09:01):
back to nine forty six. They'veworked together on a number of just athletic
endeavors. Of course they've shared therose boards together, but they've also had
a number of a pandemic situation wheretheir working. You can imagine that taking
two of the most powerful teams outof the conference did not sit well with

(09:24):
the conference in the relationship with eachother. So taking more teams out of
me, you know, expanding bymore leaving Tennis and is not again doing
They've done. They've gotten Los Angelestaken, so that gives them two media

(09:45):
market in the country. So thatleads us to what we're talking about today.
But rather than me sitting here andspeculating them what kind of what deal
Commission clear off off to main Onand other partners would be a fool's parent.
Okay, I've done it for fortyyears, and this is one of

(10:09):
those things why you just do nothave enough data to pull it together to
decide. I will say this,I know that the pack of twelve hours
under some serious situation has to dowith management. And now back a couple
of years ago, when I waswriting a Sunday column to the San Francisco

(10:31):
examer I did a deep dive intothat full now not specifically on how it's
run, but how much content andthe following that content they generated. So
I can honestly tell you that theyproduce over eight hundred live broadcasts every year

(10:54):
and they following is fine. Okay, that's the value too. In Amazon
are fixing a price to that iswhere things begin to get a little you
know, wacken. Okay, Soyou know there's as I said, there

(11:15):
is value impact ten right now becausetwo teams have gone. Whether they expand
which I assume they will, andhow and where they do that, it's
all up near right now. Sothere's a lot of uncertainty. But I've
seen many people people there on ahundred pact. Well, rest is short

(11:41):
that one of the biggest misconceptions inall the sports is that athletics make money.
Okay, there are probably less thanthirty universities in this country that actually
money in their athletic department. Andso some of these major conferences where there's

(12:13):
big TV money, be at theBig ten Selfishing conference, as see a
new deal that was just done betweenthe path at the end of the year,
Big twelve and ESPN and Fox allof that, right believe that money
helps. There's no doubt that thatmoney helps. But even in those Power

(12:35):
five conferences, you're going to seethat there are athletic departments that's simply aren't
that you money? Okay. There'sa lot of moving parts in here.
As I said before, there's alot of things to take into consideration on
what makes money where it doesn't makemoney selling tickets, getting people in there

(12:56):
the Olympics, ursus to travel.Everything that goes in follow That is part
of what we're going to talk todayabout, which more of a look at
what's going on both on the streamingside, a little bit of all and
in college in general. Streaming isgoing to put money in college into college

(13:20):
as an investment. They're not thepanacea, and they're not they're going to
save college sports from itself. Sotoday we have a pleasure of bringing to
you probably one of the foremost authoritiesone college sports, and that's Andy's emblots.

(13:50):
No. Andy is the is aneconomist, he is a sports economist.
He is the robber A Woods Professorof Economics, Smith College. And
without question, yeah, we're talkingabout someone writing the book on college sports

(14:13):
book and he's written twenty eight oncollege sports, and more than a few
of them have been about what collegesports does right and what college sports does
wrong. And Andy, great tosee us. Let's talk a little bit

(14:33):
about the PAC twelve, but what'sgoing on right now with regard to their
media rights, because it is definitelya very interesting A sixty four thousand dollar
question. It's clear that Pact twelveis greatly diminished and debilitated as a result
of the exit of USC and UCLA. They no longer have Los Angeles,

(14:58):
which is the second largest media marketin the country and rather a sports crazed
area. They no longer have thatin their media market. It's unclear exactly
how they plan to replace USC andUCLA. As such, it's hard to
assess their future economic viability. Theyhave a lot of challenges. I mean,

(15:20):
the point right now is a perilousone. Even if they had UCLA
and USC, most most of theuniversities in the PAC twelve, when you
do the accounting properly and fully,are losing tens of millions of dollars a
year in their athletic departments. Andyou know, this is at the same
time that college tuitions are exploding andathletic fees are exploding on the students,

(15:45):
and they're more and more demands onstate legislatures to subsidize college programs. So
they start at a very difficult point, and it's just made all the more
difficult with this exodus. And ofcourse college college athletics these days is in
a state of utter confusion. Andflux. Nobody knows what's going to happen.

(16:07):
There are questions about what's going tohappen in various court cases that are
currently being heard. Their questions aboutwhat, if anything, the US US
Congress is going to do, theirquestions in the in the state of California
and other states about what state legislaturesare going to do. And and we're
really at an inflection point here becauseyou know, we're sitting we're sitting at

(16:29):
the at the tip of moving inone direction, and we have the the
amateur model and tilting in the otherdirection, and having pay for play.
These are major major issues in theorganization and essence of what college sports has
been in the United States. Ontop of all of that, you have
a technological revolution going on that's quiteclear to anybody whose eyes are open um.

(16:56):
You know, first, first ofall, we have the gen Z
generation, people born in the latenineties into basically the end of the two
thousand and teens. Believe it ornot, gen Z generation people are spending
less than one hour a day watchingtelevision. That's that's by far and away
the lowest of any of the demographicgroupings. And when even when they spend.

(17:19):
It turns out that most of them, according to the research that's been
done, most of them are watchingthat less than one hour of television at
the same time that they're browsing theinternet on their cell phones or their iPads.
So it's it's a very very differentworld going forward. We also have,
of course, streaming as replacing cablecable. Cable for many decades provided

(17:41):
a guaranteed fee to the broadcaster,who in turn provided a guaranteed fee to
the conferences or to the individual teams. That world is fading very very rapidly,
and now you have to only sellYou can only sell the sports fans.
When the cables, the old cablesystem worked to thesent that it's still
workable. You know, people whodidn't care about sports or didn't want to

(18:06):
watch sports on television, they werepaying for it in their cable package.
Now you've got to sell directly topeople who want to buy it to see
what you're you're putting on um andso that's that's that's your revenue challenge.
The other thing that's a major challengeis that we have been in a frenzy
over the last at least five years, perhaps ten years amongst the new streaming

(18:27):
companies trying to get into the sportsworld. Obviously, sports programming has been
very valuable over time and until recentlygetting more and more valuable, and so
you have more and more companies likeParamount Plus and like like Amazon, like
Netflix, um like many others whoare thinking, well, our future is

(18:48):
going to be to compete against theold giants, against the NBCs and Fox
and ESPN, and they want toget into the world. So what we've
had over the last five years isthese uh, these new new companies bidding
to get into the sports world andbidding up the rights fees because there's been
more competition. But we all knowthat these deals in and of themselves have

(19:10):
not been profitable, uh, andthat these streaming companies are are making making
a play to become known as thenext ESPN or the ESPN on streaming rather
than on linear television. UM.And when when that play is over,
we're going to see consolidation because thesestreaming companies are not going to be able

(19:30):
to afford the rights fees and otherprogramming fees that they're paying. They're going
to have to consolidate. There's goingto be a consolidation, and that means
they'll be less bidders, and thatthat provides a downward impetus to also,
even even before the streaming wars began, that there had been a downward decline

(19:52):
in ratings for for for college sports. So there are a lot of things
going on here that all, inmy view, all impact very negatively on
the future of rights. Fee isa great, a tremendous amount of uncertainty.
Uh. You know, if youif you say, if you say
to a conference, we'll give youtwo hundred million dollars a year this year,
and we'll see what we pay younext year, that's not worth as

(20:15):
much as if the company says,oh, we'll give you two hundred million
dollars a year for the next fiveyears. And that's basically the situation that
the Pack twelve will be in.Uh, they're going to face a lot
of uncertainty, and the companies thatbroadcast them are also going to face a
lot of uncertainty because as far asI think any rational person can tell,

(20:37):
the rather secular trend towards decreasing ratingsis going to continue for the foreseeable future.
So when when this bidding war amongstthe streaming companies diminishes, or indeed,
when it ends and when the consolidationbegins, I think one of the
forces that has been boosting the rightsfees over the last ten years is to

(21:00):
disappear. So I think it's avery problematic situation going forward. Let's talk
about the Drake Group. What's yourpresident of? So the Drake Group is
an organization that was started in nineteenninety nine by college faculty around the country
who felt that college sports was notfulfilling its mission or that colleges themselves weren't

(21:25):
fulfilling their mission by accepting the overcommercializationof college sports. And what it gets
overcommercialized, of course, what happensis that the decisive factor becomes money rather
than education. Colleges are supposed tobe about a education, and so what's
really happened. It goes back tothe first college that competitions in the end

(21:47):
of the nineteenth century, but itaccelerates throughout throughout the twentieth century and into
this century. What happens is thatcolleges make decisions based upon what's going to
generate them or what they think isgoing to generate the most money for them,
and not what is in the bestinterests of the athletes themselves. And
so you have a situation where onlyit's less than two percent. I think

(22:08):
the number is one point six percent. One percent of college basketball and football
men's men's basketball and football players ata single game, So it's less than
two percent ever play a single gamein the NFL or ABA. More than
ninety eight percent will never play inthe NBA or an NFL well, and
they are being graduated from college inlarge no two percent of men's basketball players

(22:34):
don't graduate in six years from college. They don't get a college degree.
And a large part that's because what'shappening is the commercialization, is that colleges
have developed a strategy of special admits. If somebody's a good high school football
or basketball player, they'll get intopractically any college of their choice. They're
not adequately prepared. The colleges don'tput the resources into prepare them for They

(23:00):
come to the college and the coachesare making them spend forty fifty, sixty
seventy hours a week depending on theschool and the coach and the sport on
football or on basketball, which arenot only it's time consuming, but it's
exhausting. How do these people areunprepared for college in their first place and
then have to spend that amount oftime and energy on their sports. How

(23:21):
do they succeed? And the answeris they're not succeeding and colleges aren't doing
enough to remediate the situation. Sothe Drake Group has been paying attention to
that dynamic and arguing for a reinvestmentin the educational process, which is what
this is all supposed to be about, and at the emphasis on those factors

(23:44):
that corrupt college sports. And wehave been working very closely over the last
several years with many many members ofCongress and their staffs, trying to help
them craft legislation that would reset thecourse of college athletics. Talk about NIL
and what the pitfalls are there incollege quite a few issues. I'm sorry,

(24:06):
Jim didn't it didn't come through,Billy, Okay, just the NIL
situation. We've got a very interestingcomplan there. We you know what's happened,
and I'm sure your listeners are wellaware of this. What's happened since
July first of two and twenty oneis that the NCAA has accepted name,
image and likeness payments from third partiesand the way the nca framed it,

(24:29):
and this was after state legislation hadpassed and the Austin case was being adjudicated
and had been had been final decisionuncome from the Supreme Court. It's very
clear that there was a direction thatsaid many of the old restrictions that the
NCAA imposed on college athletes, suchas not being able to receive name,
image and likeness or NIL payments fromthird parties, that they were overly restrictive

(24:53):
and they were treating college athletes lessfairly than they were treating students in other
fields. And so since July firstof twenty and twenty one, nil payments
from third parties have been legitimated.The catch here is that the NCAA said,
Okay, we'll go along with it, and we'll go along with the
NIL payments because they're coming from thirdparties and not coming from the university.

(25:17):
So that doesn't change the student teacherrelationship that an athlete has college athlete has
with the university, doesn't turn themfrom a student into an employee because it's
coming from outside, like from Nikeor from local car dealerships or from wherever
so the NCAA said, fine,we'll go along with it, but it
has to be a situation where thecollege athlete is being paid fair market value.

(25:42):
In otherwise they can't when the collegeathlete is going to a car dealership
and signing autographs for one hour onSunday afternoon, you can't give them a
million dollars for that. That's notfair market value. That's doing something else
than payment for the nil that's sayingthe card dealers saying, oh, I'm
a big fan of the football team, and I'm going to pay this guy
come here. So that's number one, have to pay fair marketing. And

(26:03):
number two, it can't be usedfor inducement. You can't the university or
the athletic director or the coach ofthe team can't go to a high school
recruit and said, hey, we'vegot this card dealer who's going to give
you a million dollars if you cometo Wisconsin or if you come to LSU
or whatever it might be. Sothat's the second thing. It can't be
for inducement, either get somebody tocome to your college or get somebody to

(26:26):
remain at your college. And sothe NCAA imposed the at least in theory
impose these restrictions on NIL, butthey didn't implement them because number one,
they don't really have the resources tocheck up and enforce it. And number
two, they've been losing all oftheir court cases and some of them cost
tens of millions or even a onehundred million dollars enough, and the NCAA

(26:49):
doesn't want to impose new restrictions thatwill bring anti trust suits against them.
And so what's happened with this NILstuff is that we're basically on the precipits
of full pay for play. It'sit's been it's been corrupted beyond all all
imaginable outcomes, and in that regard, the mission of the Drake Group has

(27:12):
not been successful in the last coupleof years. The Drake Group is very
supportive of NIL payments if they're cominglegitimately from the third parties, and that
that is not being enforced. Butwhat we have done and what we are
doing is we're talking to a numberof people on both sides of the Island
Congress who have a similar view andwho believe that college athletes have been mistreated

(27:37):
and they've been exploited. And bythe way, the majority of them who
are being taken advantage of our athletesof color. So something happened about that,
but it's something can be done aboutit without surrendering the student athlete model
that has brought to us since nineteeneleven NCA was reated. Andy, thanks

(28:00):
a lot. You've got twenty books. That I said before, It's been
a lot of fun chatting with youas always. Look forward to doing it
again soon. All the information onAndy and his books are in the showbox
below. And Andy, have awonderful day. Thanks so much for being
with us today. To take care. So Andy's zimblest is there we go?

(28:30):
You want to stick Andy there,um and easy. Let's give a
lot of information that we definitely needto know. All of the information that
about the Drake Group, which isthe president of and also all the research
that we talked about today is inthe show box below. Be sure to
check it all out. Be sureto do your own research. I mean,

(28:55):
if you're a fan of a specificcollege or universe seem then you want
to know, you know, ismy team is my athletic department? You
know Solvent? Are they making money? Are they doing the right thing by
the by the athletes. Do alittle research. Okay, it's a very
interesting topic. It's a topic thatwe can probably do three hours on.

(29:19):
We were very fortunate to have andEVI today, as I said, look
look at the books. I've gotfive of my favorite so of his twenty
books in the Showboxball, and youcan get his books at Amazon or wherever
you get books by all means,check them out. And as as you
say, do a little sleuthing onyour own fund. It's a college sports

(29:45):
is a business. You cannot getaway from that fact. In some cases
it's a business well run. Insome cases it's not. And if you're
someone who's a big sports fan anda big college fan like myself, you
pay attention to it and you seewho's doing it right. And when you

(30:06):
see somebody who's doing it wrong,you know you call him out for it.
Okay. So for those of youout there who in some way,
shape or form have been tossing shadedas a Pact twelve because you know,
all hell's bringing loose and they're notrunning the show right, um, be
sure to check your conference and yourschools to make sure you're not throwing,

(30:32):
you know, rocks at glass houses. All right, okay, So anyway,
next time I see you. Nextweek we have Johan ber just an
outstanding director. He's got a newmovie coming out on Apple TV plus.
It's called Tetris, and he's donespectacular work on brick Box. Said two

(30:59):
or three s on Rickbox right nowas well. So John Barrett our guest
next week on stream on with JimWilliams. Until then, everybody, it's
been fun talking to Andy. It'sbeen ti fun talking about sports. This
week, we will be having moresports has to be closer to the Super
Bowl. Rich Eyes and our buddyfrom NFL Network will be here and his

(31:22):
own show on Roku which is onfive days a week. We'll have some
folks from CBS, so we're plentyof stuff having sports were related as we
go into the upcoming count down tothe Super Bowl. Okay, so,
by the way, this weekend obviouslyis the NFL Championship weekend and the game

(31:48):
will be the end I'm sorry.The FC Championship between Kansasy and Cincinnati will
be streamed on we streamed up onm Paramount plus. Ask for the forty
nine ers in the Eagles game ifyou want to watch that you're gonna need

(32:13):
to go into m take a sevenday trial with with YouTube TV or with
Kulu and Hu the TV plus.Those would be your best bets to a
seven day trial. Watched the name, watch whatever else you can you might
enjoy on their streaming services, andyou may find out that that's something that

(32:37):
you want to keep. Okay,so you can do it. You can
do it for free, just signup for free trial. You need the
Fox television station to watch it,so sign up in a free trial there.
You can also do it in NFLPlus a stream there you can buy
or take a trial there. Soeither well you're aning watching okay, So

(33:01):
again, special thanks to anas Mlissfor joining us today and looking forward to
having John Baird talking about his newmovie on Apple Plus called Tetris coming in
you know, but not do infuture actually coming leave all right, all
right, until then, everybody havea wonderful day. They're wonderful. Safe
weekend. I'm Jim Lants here andwe'll see you very very sick