In his State of the Association speech at the Centennial Convention, NCAA President Myles Brand raised some eyebrows when he said college sports needs to be more commercial.

He built to that notion by first pointing out the traditional discomfort it produces: “To some extent, it is felt that it is improper, not quite right, for the NCAA to be engaged in business activity — athletics departments need the revenue, but working too hard to generate it somehow taints the purity of college sports.”

But the surprise came in Brand’s next remark, which was a resounding “Nonsense!” in response to the concern. “This type of thinking is both a misinterpretation and a misapplication of amateurism,” he said.

While endorsing commercial activity, though, Brand was quick to emphasize that those business activities are acceptable only within the context of the collegiate model. Commercialism, he said, is not incompatible with the values of higher education — athletics directors and conference commissioners know that it takes revenue to run

successful programs. “We should not be ambivalent about doing the business of college sports,” Brand said. “We should do it well, but always in the conformity with the principles of higher education.”

That is all well and good, but condoning commercial activity trusts implicitly that people signing the contracts know what those principles are. How do presidents and athletics administrators know when they’ve crossed a values line with commercial activities? At what point is commercialism out of alignment with the institutional mission? Can that alignment be qualified?

The answers may be embedded within the business activities of higher education itself. Presidents already engage in commercialism with their institutions, and most don’t see the commercial nature of big-time college sports programs as being off center with institutional values. After all, while higher education — and intercollegiate athletics — have to conduct business for revenues, they are nonprofits on the expense side of the ledger because they redistribute earnings to support the institution’s educational mission.

But no prong of the university attracts criticism for commercial activities like the athletics department does. Of course, no other university component has its own section in the daily newspaper, either.

University of North Carolina, Chapel Hill, Chancellor James Moeser says that even big-time athletics programs such as his that earn a profit are integrated within the larger university — both in commercial activities and in sharing revenues that come from them. For example, Moeser said North Carolina athletics apparel has been the top collegiate licensed product for five years running, generating about $3.5 million a year for the institution, which it devotes to academic scholarships and financial aid.

Is that commercialism? Yes it is, Moeser said, but without the negative connotations.

“I regard the athletics program and our marks as the UNC brand, and we have a great deal of equity in that brand,” he said. “Where does the power of those marks come from? It comes from Carolina basketball and to a certain extent from a comprehensive program of 28 sports that are highly successful. Our athletics program and our reputation for being successful the right way has contributed to the brand image of the university, which has a financial return. That return is a big number, but I don’t see commercialism as an evil, simply because of the way we apply the revenues.”

Moeser is a member of the recently created Presidential Task Force on the Future of Division I Intercollegiate Athletics, a group of about 50 presidents and chancellors charged with keeping the Division I ship, particularly its financial bow, on a fiscally responsible course in an age of increased stress on the enterprise.

Intercollegiate athletics spending has increased at rates three times those of higher education itself over the last several years, a trend most presidents see as neither sustainable nor desirable. Most institutions balance their athletics budget only with the help of institutional subsidy. Because spending has increased, so has the amount institutions must allocate to athletics from other campus resources, a trend that some say might, if pushed to the extreme, distort or even corrupt the academic mission.

But higher education is under tremendous fiscal pressure as well. Many public institutions are feeling the pinch of reduced state allocations. That in turn puts more pressure on individual university components to contribute to the bottom line.

West Virginia University President David C. Hardesty Jr., also a task force member, said any university department should generate revenue, whether by ticket sales or research dollars, to the greatest extent possible — as long as the revenue is generated in line with institutional values, of course.

“We do come up against how far we are willing to go in that regard. How commercial can we become until we truly infringe on the values of an academic institution?” Hardesty said. As to knowing that boundary, Hardesty said, “It’s a little like the Supreme Court definition of obscenity — you know it when you see it.”

Jim Delany, commissioner of the Big Ten Conference, which annually generates more revenue than any other league, said the line is hard to define because it’s always moving.

“The lines are different depending on each institution’s situation. There may not be 300 different lines in Division I, but there may be four or five,” Delany said. “Need drives the line too often, but it’s not to be unexpected.”

For example, Delany said, if an institution has leverage at the negotiation table, it can dictate the line. Without leverage, though — and with need — then the activity can cross the line, or at least push it. Delany said that has been manifested in the trend for playing football games on weeknights. “It’s not necessarily that those institutions want to play those games during the week, but when they balance having no exposure and no revenue with having at least some of each, they come down with a limited approach to playing games off the traditional days. It’s all in response to where the line is,” he said.

Who makes the call

In many ways, commercialism has evolved. “It’s been 100 years since tickets were free,” Delany pointed out. Commercial dollars escalated first through ticket sales, then radio rights, game programs, television rights, increased ticket prices, season-ticket packages, special seating, luxury boxes and corporate sponsorships. Each may have been considered to be crossing a line by those who accepted the preceding method as a tipping point, but commercial activity seems to reflect social norms more than value judgments.

“Judgments about balancing commercial activity with the values of higher education depend on where you are and change from campus to campus,” Delany said. “We don’t play Thursday night games in the Big Ten because we can afford not to. But there isn’t an ideal line. Obviously, lower ticket prices are preferred to higher, and fewer commercials are preferred to more, but tastes change depending on the times.”

Obviously, presidents play a role in determining those tastes. But Hardesty said deciding whether commercial activity oversteps institutional boundaries is more of a collective agreement than a presidential mandate.

The modern president, Hardesty said, is the CEO of a complex organization. To the extent that athletics acts as a marketing arm of the university and represents the character of the university nationally — and to the extent that it affects the university’s budget and values — presidents see it as their responsibility to be involved. But other players occupy the commercial turf as well, including athletics directors, faculty members, conference commissioners, alumni groups and boards of trustees.

Hardesty used as an example an orientation seminar he attended at Harvard University when he became West Virginia’s president more than a decade ago.

“In a fit of candor, I asked, ‘Who owns the university?’ ” Hardesty said. The Harvard dean administering the session said, “It’s a question that should never be asked, let alone answered.”

“What he meant by that,” Hardesty said, “was that each of the constituencies of the university are powerful in their own right, and they have different views on different topics. If you asked the faculty whether we’ve crossed the line with commercialism, they might say yes. If you ask the board, they might say no.

“It’s the president’s job to listen to all segments of the university and to make a fair assessment, given the culture and values of the institution, as to whether the line has been crossed.”

North Carolina Chancellor Moeser pointed to a good example. Several years ago, his institution began negotiating with Nike on a multimillion-dollar apparel contract. What made the deal unique wasn’t the money, but the intangibles.

Moeser and university officials made a collective decision to demand that the apparel giant manufacture not only T-shirts and caps but also the school’s athletics uniforms according to fair labor practices. Nike agreed as long as North Carolina demanded the same from other apparel providers (for example, uniforms for groundskeepers and medical white shirts).

“It certainly was commercial activity — it’s a $28 million agreement, so it’s very important to our financial bottom line,” Moeser said, “but we also used the negotiation as leverage to drive social change.”

Staying in bounds

Thus, two lines are in play — a bottom line and a values line. Where they intersect is key for college presidents. Can naming rights go too far? Can endorsements compromise university integrity? Can signage send a mixed message?

The check point, said Presidential Task Force Chair Peter Likins, is behavior that the enterprise ultimately finds unacceptable, which may depend on the institution.

“In a certain sense, the athletics enterprise and a corporation are inverse entities,” the University of Arizona president said during a discussion of the business aspects of college sports. “The purpose of the corporation is to maximize financial benefits while operating within social constraints. The purpose of intercollegiate athletics (or higher education) is to maximize social benefits while operating within financial constraints.

“I’m not denying that there is a trend that is increasingly commercial in how we manage some of our sports, but that doesn’t mean all of college sports is a business. It means we’re having a hard time maximizing social benefits within the current financial constraints.”

Hardesty goes back to his Supreme Court example. He thinks university leaders intuit the commercialism boundary, and for the most part, they do a good job of not crossing it.

“When winning at all cost becomes a value, that’s wrong,” he said. “Pushing peripheral activities at the expense of the true core mission of the university is wrong. People just have to make their own judgment about it, and it’s not just one person’s judgment to make.”

Delany agreed, saying that when he enters into agreements on behalf of the Big Ten, he has to reflect what he understands to be the prevailing tastes for balancing need with revenue and exposure. “I’ve got to ask questions, listen to concerns and balance those points of view,” he said.

In some cases, Delany said, that means leaving money on the table. The Big Ten, he said, could pursue weeknight football games, or it could choose (along with the Pac-10) to entitle the Rose Bowl, but it does neither because it doesn’t need to. Similarly, he said, the NCAA basketball tournaments are relatively clean because they don’t need the commercial involvement.

But, he emphasized, “need” is the elusive variable.

“You can’t criticize institutions’ commercial activities with a broad brush,” Delany said. “You have to understand the individual circumstances and pressures. If a school is subsidizing athletics with $5 or $10 million that otherwise could be going to laboratories and teachers, I can guarantee that institution will take all the commercialism it can get, and it’s probably the right thing to do. That case in fact actually fits the collegiate model because it puts more money into the pockets of professors and faculty and the delivery of education.

“But the line depends on your needs, your tastes and the overall circumstances. There is no idealized line. The definition of the line is in the eyes of the beholder.”