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Pac-12 Revenue Sharing Model: Socialism in Action.

Discussion in 'Colorado Football Message Board' started by RalphieMalph, Sep 5, 2011.

  1. RalphieMalph

    RalphieMalph Well-Known Member

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    Thoughts?
     
    buff4bcs1985 likes this.
  2. JimmyBuff

    JimmyBuff Well-Known Member

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  3. Darian3Hagan

    Darian3Hagan '89 Player of the Year Club Member

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    Works pretty well for the NFL.
     
  4. JRK1212

    JRK1212 Troll

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    California does always vote democrat...
     
  5. buff4bcs1985

    buff4bcs1985 Hail to the King

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    he lives!!!! now get me a beer and burrito and pay for your club membership!!!
     
  6. Sexton Hardcastle

    Sexton Hardcastle Club Member Club Member

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    So I take it you're not grounded from the computer anymore?
     
  7. Buffnik

    Buffnik Real name isn't Nik Club Member Junta Member

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    :lol:

    It's a consortium of independent operations that choose to band together to create a group brand because they each agree that by working together they can make a lot more money than any could make on its own. The new organization is like a 12-way joint venture in which each shareholder gets one share. Risks and rewards are shared equally. Each, on its own, still retains tremendous opportunities to earn money on operations not associated with the new brand that is wholly its own and not shared with the group. In the event that the 12-way joint venture chooses to expand to 16, it offers 4 new shares for 4 new members and each of the original 12 dilute proportionally with the shared risk/reward that the value of the additional members outweighs the cost of dilution. The issuance of new shares is only approved by vote of a super-majority of current members under the agreed-to by-laws. New members enter the association by choice after considering what other options may be available to them and weighing the pros and cons of the best entrepreneurial strategy for its operation.

    How in the hell is that socialism?

    The UT advocates like to put that label on things because it's a word that carries a stigma, but all they're really saying is that they want more shares and more of a controlling interest in the joint venture. If they're told "no", that's capitalism in action.
     
  8. RalphieMalph

    RalphieMalph Well-Known Member

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    The really nice part about not having a club membership is that most people don't notice when you post something - I've got welcome back messages/rep spanning about the past 6 weeks. Club membership be damned!

    Follow-up question: If the Pac-12 revenue sharing model is a socialist program, who would the University of Colorado within the context of the United States? Disenfranchised laborers from our formerly viable manufacturing sector? Floor managers at Wal-Mart? Recent college graduates working temp gigs for $10/hr? Black people? The question here is the degree to which our ass is getting saved by this system.
     
  9. buff4bcs1985

    buff4bcs1985 Hail to the King

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    i think ive repped you twice in that span you whore
     
  10. RalphieMalph

    RalphieMalph Well-Known Member

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    Because the lump sum of money that the league receives on a yearly basis is divided equally amongst the 12 teams involved. Performance is irrelevant - if you win 2 games and bring in Evening Shade rerun level ratings, you get X amount of dollars from the television contract. If you win 10 games and your games consistently get picked up nationally, you get X amount of dollars from the television contract as well.

    It's a system in which all parties have agreed that it's in their best interest to make certain that they'll all get paid at a level that will sustain their existence comfortably regardless of their on the field performance. Surely, some will perform beyond expectations in one year and enjoy significant monetary bonuses from outside sources (and others will do the opposite, fail to receive those bonuses, and live far less lavishly as a result of it) but no one will live within the realm of gratuitous wealth that would be possible if they DIDN'T participate in this revenue sharing, nor will anyone experience a level of relative AD poverty that would be possible were the rewards of being in the conference based solely upon performance.

    That's TOTALLY socialism! Eliminating the highest and lowest realms of monetary gain/loss for the sake of creating a predictable and reliable flow of stable income.
     
  11. Buffnik

    Buffnik Real name isn't Nik Club Member Junta Member

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    The conference has media contracts and each member owns an equal share. The equal sharing is on these conference media rights. Whether USC wins 7 games or 10 games in 2015, the amount that ESPN and Fox paid for broadcast rights for that year is the same. They bought conference rights. I don't understand your point.
     
  12. Jens1893

    Jens1893 Moderator Club Member Junta Member

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    It is socialist, Nik, if this was capitalist, they´d handle it like they handle it with the TV rights in Spain where every team gets to sell its home games themselves. The result? The 20 teams receive approx 600m € for the TV rights in total. Barcelona make 158m €, Real Madrid make 136m € (that´s approx 50% of the money for 2 teams) and smaller teams like Getafe get 5m €.

    Is that fair? Yes, but it´s not good for competition. Not good at all.

    You think Washington State would be able to get the same deal USC gets if they got to sell their rights individually?
     
  13. RalphieMalph

    RalphieMalph Well-Known Member

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    Thanks Jens. No way I could have come up with as clean of an example as that.

    Now I've just got to grapple with the irony of that example originating from Spain...
     
  14. Buffnik

    Buffnik Real name isn't Nik Club Member Junta Member

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    But teams are free to do that, Jens. They don't have to join a conference. There don't have to be conference networks. USC did not agree to a Pac-12 with equal revenue sharing if it weren't for the fact that a 1/12 share of a conference network and 3rd party media deals wasn't worth more to it than going it alone. Notre Dame is a prime example. It will make less by going it alone than anyone in one of the major conferences (except maybe the Big East because it gets an equal share there for everything except football). Participating in a conference, being able to sell the volume of games from that conference, being able to sell broadcast rights to the conference championship game, being able to form a network, and gaining automatic bids from a number of bowl games is a business decision. Cooperation in the service of self-interested capitalism does not equal socialism.
     
  15. RalphieMalph

    RalphieMalph Well-Known Member

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    fify.
     
  16. RalphieMalph

    RalphieMalph Well-Known Member

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    It's in the interest of maximizing financial stability/predictability and minimizing risk for all involved parties.

    It's removing the extremes of potential wealth or lack thereof in exchange for a large predictable sum every year, regardless of individual performance.

    It largely removes the financial punishments for an 18 game road losing streak, or a loss of scholarships, or whatever other ills can befall a program. And at the same time it removes many of the potential riches for winning back to back MNC's.

    It's totally socialist!
     
  17. Buffnik

    Buffnik Real name isn't Nik Club Member Junta Member

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    Apples to oranges. In your example, private insurance is socialized medicine. What makes your example socialism is that you took choice out of the equation as well as the market forces.

    Making a decision to partner in order to share risks and rewards is not socialism.
     
  18. Buffnik

    Buffnik Real name isn't Nik Club Member Junta Member

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    None of the things you listed are socialism.
     
  19. LaserDeathHawk

    LaserDeathHawk Club Member Club Member

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    There is a business for sale for $100,000. I could buy the entire thing and assume all risk and gain all profit or I could bring together a group of investors who buy in for varying amounts but the deal is we wil split profits evenly.

    1) no one was invited to invest that didn't have something to bring to the table
    2) no one was forced to join
    3) everyone knew the terms up front

    Socialism looks very different
     
  20. ScottyBuff

    ScottyBuff Well-Known Member

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    And you are ignoring the fact that each member still has their own ability to earn money based on their own performance (ie ticket sales, concessions, merchandise, seat donations, etc etc).
     
  21. BehindEnemyLines

    BehindEnemyLines beware the habu Club Member

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    Wow, I went to a boxing match and a hockey game broke out.
     
  22. buffedup

    buffedup Cooler than a Popsicle Stand. Club Member

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    Who gives a ****. All I care about is that Colorado joined a conference that is a better fit academically and culturally and will also now be making boatload of cash in TV revenue. Go to the politics board if you want to talk socialism vs capitalism.
     
  23. The Guest

    The Guest Guest

    Is a co-op socialist?

    I'm undecided on this, and I've actually been thinking about it long before this thread.

    I think maybe the conferences are the businesses (not the schools), and good football (in this example) is the product. For this perspective, you'd have to move your level of competition up a notch. Instead of the teams competing directly in the marketplace, it's the conferences that compete. Thus capitalism.
     
  24. ThndringHerd

    ThndringHerd Well-Known Member

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    Think of the PAC-12 as a business partnership competing against other partnerships for market share and revenue within an industry. Nothing socialist about partnerships. Now if the gov't were to step in and mandate that revenue be taken away from PAC-12 schools to subsidize MAC schools, that would be an example of socialism.
     
  25. Darth Snow

    Darth Snow Hawaiian Buffalo Club Member Junta Member

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    Nik, here is something to ponder when it comes to your claim that the teams have choices: Was staying in the big12 really a legitimate option?
     
  26. PhillyBuff

    PhillyBuff Club Member Club Member

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    You do not understand socialism...

    under your theory..... what would inevitably be the result.... is Texas would play Notre Dame every week and ESPN will cover it ad nauseam....


    Fundamentally, no team can operate independently so sharing revenues has to occur. Socialism would be giving every single college football program the same amount no matter what.

    What Texas does not undertand (some people do in Austin) is that the Longhorns require an opponent to play them and that opponent adds value. If they want to go independant, they are free to do so... THAT my friend, is Capitalism!
     
  27. Buffnik

    Buffnik Real name isn't Nik Club Member Junta Member

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    I don't know. But if it wasn't, that's only because a conference association that does not give equal shares of conference revenue to its members is inherently unstable and a bad business model.
     
  28. Buffnik

    Buffnik Real name isn't Nik Club Member Junta Member

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    That's the key, Wally. The "conference" is a business and a brand. It negotiates licensing deals as an entity and competes against other conferences for media contracts, bowl affiliations and merchandising deals. Within this conference are individual athletic program businesses and brands. These athletic programs compete against other athletic programs for local sports entertainment dollars (ticket sales), media rights for non-conference games, merchandise sales, booster donations, etc.

    Given the national prestige and location of a USC, it will always generate a lot more money than Washington State as an athletic program. However, it needs Washington State and others to be able to form a conference business and brand that is much more valuable to it than the revenue it could generate if it was independent. While it agreed to an equal distribution of conference revenue, it was done with the stipulation that it was guaranteed a minimum distribution (as was UCLA) and that if the conference as a whole wasn't able to generate at least that number with an equal split then they would earn more than other programs as an unequal distribution. A program like UT would likely come in with the same consideration in addition to getting the extra revenue from the conference purchasing its LHN asset in order to roll it into the Pac-12 Network.
     
  29. RalphieMalph

    RalphieMalph Well-Known Member

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    So if government owned companies in Sweden and Norway bid on a project that would bring additional financial prosperity to whichever country earns the contract, does that competition over monetary rewards by default turn them into non-socialist entities? Or are they socialist entities competing over a capitalist gain?
     
  30. FlatironsBuff

    FlatironsBuff Club Member Club Member

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    Only in regards to the revenue generated by tv contracts. Alumni donations to the teams, ticket sales in the stadiums, and recruiting success will be buoyed by the back to back Championships. But the bad years, while you are hurt in filling the stadium and in recruiting, you are not hurt financially with the tv revenue also. In socialism, you would not get any benefits. Nobody would win. Juice boxes and orange slices for everyone.
     

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