Sports

Notre Dame, the Fleecing Irish


Notre Dame’s football program is the envy of every university in the country, although this has nothing do with the team’s recent performance on the field. The last of its 11 consensus national championships came in 1988. Since 1995 the Fighting Irish have a dismal 2-9 bowl record—mostly in lesser, non-Bowl Championship Series contests. Last year’s promising 8-5 season under new coach Brian Kelly was marred by a tragic accident, when a film tower fell over and a student was killed. This season opened with a humbling loss to the University of South Florida.

But what Notre Dame does have, unlike every other football program in the nation, is a $15 million-per-year sweetheart deal with NBCUniversal to broadcast its home games nationwide. Never mind that the recent ratings for Notre Dame’s games suggest that NBC, which was acquired by Comcast (CMCSA) from General Electric (GE) earlier this year, may want to re-think the deal when it expires in 2015. Take, for example, the much-hyped Saturday evening game between Notre Dame and Army at Yankee Stadium on Nov. 20, 2010. In 1913, Notre Dame’s away victory over Army, then a national powerhouse, put the upstart Catholic university on the map (and demonstrated the effectiveness of the new forward pass). Last season’s rematch didn’t even muster a 1.0 Nielsen (NLSN) rating among 18- to 49-year-old viewers. While only 3.48 million viewers watched the game, 5.38 million tuned in to ABC’s (DIS) college football coverage (three different games by region). Meanwhile, repeats of CBS’s NCIS: Los Angeles and Criminal Minds beat out both football options.

“For us, Notre Dame was and remains a unique brand of college football,” NBC Sports President Kenneth Schanzer, who brought Notre Dame football to the network 20-odd years ago, told Bloomberg Businessweek in July, a few weeks before he retired on Aug. 31. “It’s an important part of aligning NBC’s sports brand with both an iconic and elegant brand.” More neutral observers have other terms for Notre Dame’s “uniqueness,” starting with “mediocre.” “Not everyone remembers the days of Knute Rockne, Ara Parseghian, or even Lou Holtz,” says Keith Dunnavant, author of The 50 Year Seduction: How Television Manipulated College Football, from the Birth of the Modern NCAA to the Creation of the BCS. “Today, Notre Dame’s football program is under tremendous strain to remain relevant.”

The first television broadcast of a college football game came in 1939 (Fordham defeated Waynesburg), but it wasn’t until 1950 that universities signed exclusive yearlong deals with networks. That year, the University of Pennsylvania sold its home-game rights to ABC for $150,000 and Notre Dame made a similar $185,000 deal with DuMont Television Network. But these deals were short-lived. Other schools, joined under the new umbrella of the National Collegiate Athletic Assn., fretted that television coverage hurt ticket sales—then the main source of football revenue—and wanted to restrict TV coverage. Armed with little more than the power of censure, the NCAA strong-armed Penn and Notre Dame into backing out of their deals ahead of the 1951 season. For the next 40 years, until the Supreme Court intervened, the association wielded monopoly control over college football’s TV deals.

During this time, Penn and the rest of the Ivies faded from the top ranks of college football. But not Notre Dame, and it pressed its advantage in the 1970s, when several universities began bristling at the NCAA’s control over their television rights. The NCAA didn’t exercise monopoly control over basketball, they noted, so why should football be any different? In 1976, several of the bigger conferences—including the Big Eight, Southeastern Conference, and Atlantic Coast Conference—formed the College Football Assn., along with independent Notre Dame, Penn State, and the University of Pittsburgh, in an attempt to break away. The fight went all the way to the U.S. Supreme Court, which in a 1984 decision (NCAA v. Board of Regents of the University of Oklahoma) ruled 7-2 that the NCAA’s arrangement was a “classic cartel” and invalidated the organization’s existing television contracts.

As the CFA negotiated new contracts over the next decade—switching among CBS, ABC, and ESPN—everyone understood that the crown jewel was Notre Dame, which had been involved in half of the 12 highest-rated games in history. But for Notre Dame, the CFA soon became as constricting as the NCAA. In 1990 the CFA’s impending deal with ABC would have shifted several Notre Dame games from national to regional coverage.

NBC’s Schanzer sensed an opportunity. “We’d been close to Notre Dame already largely because of our basketball coverage,” he says. As he learned of Notre Dame’s displeasure with the impending ABC deal, he walked into NBC Sports President Dick Ebersol’s offices. “I said, ‘You know, Dick, I’m not sure we couldn’t work some magic here,’ ” he says. Soon after, the network signed a $38 million contract with Notre Dame to cover home games from 1991 to 1995. Such was the deal’s significance that it was set to be the cover subject for the following week’s Sports Illustrated, Schanzer says—that is, until an unheralded boxer named James “Buster” Douglas delivered a brutal flurry of punches to Mike Tyson in Tokyo.

The decline of Notre Dame football has not been as precipitous as Tyson’s, but it hasn’t been pretty. During coach Charlie Weis’s five-year tenure, during which he compiled more losses than both of his brief, disappointing predecessors (Tyrone Willingham and Bob Davie), Notre Dame fell to Navy three years running. In 2009, after the Fighting Irish also lost to Pittsburgh and the University of Connecticut, Athletic Director Jack Swarbrick dismissed Weis with an $18 million buyout—a year and change of the NBC revenue.

Apologists for the team’s performance say the school’s rigorous academics, akin to Stanford’s or Duke’s, translate into fewer blue-chip recruits. Murray Sperber, author of Shake Down the Thunder: The Creation of Notre Dame Football, points to the failed 1990 recruitment of Randy Moss, who had a rap sheet and a “questionable academic future.” Although Lou Holtz coveted the talented receiver, the admissions office turned him away. Florida State University didn’t have the same reservations—at least not until Moss was arrested for drug possession in his freshman year.

“Notre Dame can’t institutionalize the kind of a recruiting that an Alabama can or a USC can,” Sperber says. “Because Notre Dame is a small school, you can’t hide athletes. Every student has to take the freshman curriculum, which includes some low-level calculus. You can’t set up a special sports management major like you can at Michigan.” Swarbrick refuses to make these excuses. “Our recruiting pool may be smaller, but within that pool there’s enough talent with the right leadership to win a national championship,” he says.

An NBC spokesman says NBC is as devoted to Notre Dame as ever, but it’s doubtful that the new Comcast executives will be as loyal to the school as the recently departed Ebersol and Schanzer were. Both sent children to Notre Dame, and their relationships with the university are personal. At one point, three of Schanzer’s children were enrolled at Notre Dame. “No one can have more Jewish kids at the school than me,” Schanzer says he joked to an admissions officer. And while the rights to Notre Dame football are a relatively minor expenditure—the network spent $4.38 billion to secure the rights to the Olympics through 2020—it’s increasingly hard to justify. Only the SEC’s teams earn more from television rights than Notre Dame, roughly $17 million per team per year under deals with ESPN and CBS. But SEC teams have won the last five national championships.

Wachter is a Bloomberg Businessweek contributor.

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