Steinberg: March Madness truly maddening

From schoolyards to office buildings all across this country millions of people are involved in basketball predictions, as the circus known as, "The Final Four – The NCAA Men's Basketball Tournament," has come to town.

Sixty-eight college teams are competing for the right to be crowned champion of the U.S. in men's basketball.

The games have begun and the economic bonanza will follow. Billions of dollars will change hands among bettors and the NCAA and its schools will be infused with new riches.

The first source of revenue is broadcast rights.

In 2010, CBS Sports and Time Warner's Turner Broadcasting signed a $10.8 billion deal to broadcast every game of the men's basketball tournament for 14 years.

Time Warner and CBS will split coverage until 2024. That is more than $770 million per year, which is a percentage increase of 1,877% over the last 30 years.

In 1982, CBS paid just under $50 million for three years of rights.

Adding the inflation value to the CBS 1982 package, the comparison is $39 million a year compared to $770 million. The NCAA itself will bring in $777 million this year, 90% of which comes from the tournament television and other media rights.

Last year $478 million of the revenue went back to Division 1 schools, with more than a third of that based on the schools' success in the tournament.

In 2011, according to Kantar Media, CBS and Turner were able to generate $738 million in advertising for the tournament.

General Motors was the top advertiser and they spent almost $58 million in advertising the March Madness event. The cost of an ad for the championship game was $1.24 million.

This year, the expansion in content platforms allows fans to watch the games on live streaming on their computer, mobile phone, tablets and cellular phones.

Last year, there was a $3.99 fee to watch all the games on the March Madness app.

The high point in viewership for the tourney was over 30 million fans that watched the 1992 final game featuring Michigan against Duke.

The universities benefit mightily in the exposure.

When Virginia Commonwealth University made the 2011 Final Four, donations to its athletic department gained 376% and overall giving to the school by 46%.

Alums remember their university allegiance and feel pride when their team is involved.

After Butler University made it to the finals in 2010, their applications increased 41% and the value of the publicity and exposure they received was estimated at $639 million.

Coaches have bonuses in their contracts for making the tournament. The University of Florida's Billy Donovan receives $37,500.

The host city will be a beneficiary. More than 75,000 fans packed the Superdome last year in New Orleans. That marked the first hosting by the Superdome of the event since Hurricane Katrina.

The mayor's office estimates the games infused $134 million into the city.

Regional host cities also benefit.

It is gambling — basketball pool card — that generate the most economic activity.

The Final Four is second only to the Super Bowl in amount of wagers placed in Las Vegas with some $80 million wagered. That is an infinitesimal percentage of the overall dollars wagered as this event reaches far beyond hard-core college basketball fans to reach into every sector of American life.

Estimates are that some $12 billion will change hands over the course of the tournament. And what do the actual participants in this event — the players — receive?

They have a scholarship that at a school like Duke, costs around $228,000 for four years.

Of course the most talented players in college basketball attend school for one year now and then enter the pros.

Is the system fair to players? You decide.

*Sources for this article came from Darren Rovell, Brad Turtle, and Ben Steverman.

LEIGH STEINBERG is a renowned sports agent, author, advocate, speaker and humanitarian. His column appears weekly. Follow Leigh on Twitter @steinbergsports.

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