How Much Money Do Conferences Earn From March Madness?
There is a mad amount of money to earn from the NCAA through March Madness.
In 2010-11, the NCAA distributed $478 million to conferences and member institutions. 40.5 percent of the revenue distributed by the NCAA was designated to something called the “Basketball Distribution Fund.” This distribution percentage makes the Basketball Distribution Fund the largest area to which the NCAA directs funds for revenue distribution.
According to the NCAA’s website, “The basketball fund provides for moneys to be distributed to Division I conferences based on their performance in the Division I Men’s Basketball Championship over a six-year rolling period.” For each March Madness game that a school participates in, except for the Championship game, the school’s respective conference earns a “unit.” Each unit is worth a designated dollar amount. According to the NCAA’s website, in 2010-11, each unit earned was worth approximately $239,664.00. Thus, the further a conference’s teams go into March, the more money that a conference can earn from the NCAA’s revenue distribution system. The NCAA suggests that conferences divide the payout they receive from the Basketball Distribution Fund equally amongst their member institutions.
As noted above, the Basketball Distribution Fund calls for revenues to be distributed based upon schools’ performances over six-year rolling periods. However, the tables below demonstrate how accumulating wins during the course of one March Madness run can earn conferences a sizable amount of the revenue distributed by the NCAA.
First, consider how many units were earned by the respective participants of the 2011 Division I Men’s Basketball Tournament:
|School||2011 Units Earned||Conference|
|Indiana State||1||Missouri Valley|
|Kansas State||2||Big 12|
|Michigan State||1||Big Ten|
|Morehead State||2||Ohio Valley|
|Northern Colorado||1||Big Sky|
|Notre Dame||2||Big East|
|Ohio State||3||Big Ten|
|Penn State||1||Big Ten|
|San Diego State||3||Mountain West|
|St. John’s||1||Big East|
|Texas A&M||1||Big 12|
|UC Santa Barbara||1||Big West|
|UT San Antonio||1||Southland|
|West Virginia||2||Big East|
Next, take a look at how many units respective conferences earned as a result of their member institutions’ performances during the 2011 tournament:
|Conference||2011 Units Earned|
Given the number of units each conference earned in 2011 and the NCAA’s report that in 2010-11, each unit was worth approximately $239,664.00, one can surmise that 1/6 of each conference’s total Basketball Fund Distribution payout was equal to the number of units earned by their teams in 2011 multiplied by the unit payout amount. A calculation of this is below:
Finally, the NCAA reported how much was distributed to conferences via the Basketball Distribution Fund in 2010-11:
|Conference||2011Basketball Fund Distribution|
The big winner in terms of Basketball Distribution Fund distributions is the Big East. Its known success in basketball has allowed it to accumulate a sizable number of units over the course of the past six years, such that it received the highest payout of all conferences in 2010-11.
While the Big East’s basketball prowess has allowed it to reap the biggest amount of the Basketball Distribution Fund pie, the Horizon League’s payout is an indicator of how the success of one team can boost a conference’s payout. In 2010-11, only ten conferences (including all six of the BCS AQ conferences) received a higher payout than the Horizon League. The Horizon League is home to the Butler Bulldogs, who have made it to the championship game the past two years. As such, over the course of the last two years, Butler alone has earned 10 units for the Horizon League. Given that most mid-major conferences only earn one unit in a given year, the results that Butler has been able to produce are noteworthy.
So what can one take-away from these numbers? The big picture here, is that with each round that a team advances into during March Madness, the bigger piece of the NCAA revenue pie it and its conference will share.