Oklahoma State’s 2-for-1 Play Not Ideal but Financially Responsible

One of the interesting misnomers about Oklahoma State University is that it is a powerhouse financially. The reason for this is two-fold. First, people falsely equate Boone Pickens’ bank account and Oklahoma State’s revenue stream. Second, people just assume that great football teams make for financially lucrative athletic departments.

Both are only partially true. It’s not as if Pickens is giving money every single year to OSU. His donations have been beyond generous, but they have also not been given in such a way that helps OSU balance its budget year in and year out. They were one-off gifts, mostly for specific projects.

Last year, OSU ranked No. 37 in athletic department revenue at $93.7 million. Behind football powerhouses like Indiana, Illinois, Minnesota and Arizona State. Good, not great.

All that to say that when it comes to money, OSU can’t afford to be as loose as some other top-tier programs, which leads us to a football game on a Friday night against South Alabama. On the road.

This is not what big-time football programs do, right? Well yes, but big-time football programs also normally have more margin in their budgets.

OSU is being paid $300,000 to go to Mobile, Alabama on Friday to play South Alabama. In return, USA will come to Stillwater twice (2018 and 2023) and be paid $625,000 and $300,000 respectively. Effectively, OSU is getting a three-game series for $625,000.

When you start to look at how much other teams are paying — between $500,000 and $1M — for South Alabama-like schools to visit, you begin to see just how much money OSU is saving. Let’s say the game tonight was in Stillwater. That would cost OSU, say, $600,000 (a difference of $900,000 from getting paid tonight). Also, South Alabama would likely not have agreed to the 2023 game for only $300,000 if OSU wasn’t already going to Mobile.

USA’s getting a smaller guarantee than it otherwise would for a Big 12 visit, but Erdmann thinks the school can make up the difference through increased ticket sales and “adjoining sponsorships” for a really big Oklahoma State game. [SB Nation]

So let’s say you have to pay them $600,000 to come in 2023. That’s another $300,000 beyond what you were already spending. Add that to the $900,000, and you’re essentially saving $1.2M just to go on the road one time against the Jags.

It’s a concept you may disagree with, but it makes a little bit of sense with the budget OSU is working with. It’s also one OSU has tried before. They did the same with Central Michigan (with slightly different numbers).

Mike Gundy told the Tulsa World, “it’s a financial deal,” which is true.

Of course you could argue that the risk of going on the road and losing a game like this would cost you far more than paying a team to come to Stillwater, but as we saw last year, playing directional schools at home isn’t exactly a sure-fire route to 12 wins, either.