All sorts of people make all sorts of money from the tournament. There are ads, sponsorships, ticket sales, wagers and more. But who gets the money, and how much?
1. Broadcast Rights
In 1982, CBS agreed to pay $16 million a year for the rights to broadcast the tournament. In 2010, the NCAA and CBS renewed that agreement for 14 years, but with an increased price tag: $771 million a year.
CBS owns all the channels which broadcast the games (CBS, TNT, TBS, and TruTV).
For comparison, CBS, NBC, and FOX pay between $950 million and $1.1 billion for just the Super Bowl. CBS, NBC, and FOX will soon pay around $3.1 billion a year for the rights to the rest of the games, while ESPN will pay $1.9 billion.
More comparison: FOX and Telemundo paid a total of $1 billion for the rights to the 2018 and 2022 World Cup.
The money paid by CBS goes to the NCAA, where, according to their site, 96% of it is distributed to Division 1 schools in some fashion.
2. Advertising
While it's no Super Bowl, the tournament does get some pretty great ad rates, especially for the Championship. A :30 spot during the first round costs between $100,000 and $250,000 ($110,000 is average for network TV), while the same spot could cost more than $1.6 million during the championship. (For comparison, a :30 ad during the Super Bowl can cost more than $3.5 million.)
According to Adweek, a first or second round ad (again, :30) goes for $100-$250,000. By the time the Final Four hits, the price is up to $1.1 million, and the championship goes for the previously mentioned $1.6 million.
Last year's tournament brought in around $775 million in ad revenue for CBS. This year, that number is expected to rise to around $875 million.
Another interesting area related to advertising is ratings, which is the largest factor affected the price of an ad.
The incredibly worthless "First Four" games managed to get 4.48 million viewers this year (a pretty low rating when compared to network shows, which can get up to 15 million a week, but a pretty nice one when compared to cable shows, The Americans gets about 2 million a week and Breaking Bad and Mad Men get between 1 and 3 million.)
That 4.48 is up 14% from last years First Four.
Last year's tournament averaged 9.6 million viewers per game. The championship last year was watched by 20.1 million viewers.
3. Sponsorships and Ticket Sales
If you've seen any of the games, you've definitely experienced some of the sponsorships. AT&T got their mame slapped on every half time show, Capital One is sponsoring the Tournament Central studio show. (Coca-Cola is the third premium sponsor this year.)
While details are scarce on the numbers behind the sponsorships, it is estimated that Capital One pays $35 million their sponsorship.
In previous years, ticket sales and sponsorships have made more than $40 million for the NCAA. That number will likely be significantly larger this year. Again, 96% of this money is distributed to Division 1 schools.
4. Wagers
Chances are you filled out a braket. It's also pretty likely you entered this bracket in some sort of monetary award system, which requires an initial "investment" from you. Each year, an estimated 40 million brackets are filled out, and $7 billion is bet on these brackets. (That's more than the Super Bowl's $6 billion.)
Because of all this money on the line, employees have been known to focus less on work and more on sports. One survey estimatesthat 8.4 million hours of time are wasted during the tournament by private sector employees. Since the average pay is $22.87 an hour, that comes out to $192,108,000 in wages.
It is worth noting however, that this survey assumed that employees would otherwise be productive, which we all know is not always the case.
What's it All Mean?
So, unsurprisingly, a lot of money is made by people (mainly CBS and the NCAA) during March Madness. In total, about $1,693,000,000 is moved around by college basketball this month. With that you could buy 3.38 million iPads, 16,930,000,000 pieces of gum, or 483,714,285.714 gallons of gas, or enough to travel 11,609,142,857.1 miles in the US.
You could also buy 7,695,454,545.45 meals for starving families in Africa.
I leave it on that uplifting note.
Sources: Adweek, Investopedia, Wikipedia
