Apr 22, 2010 4:18:44 PM

The fact that the NCAA has signed a new rights agreement for the Division I Men's Basketball Championship did not come as a shock, but the amount of the agreement may come as a pleasant surprise for the NCAA membership.

The new agreement with CBS and Turner Broadcasting will pay the Association $10.8 billion over the next 14 years, or an average of $771 million. After backing out the 4 percent that goes for operations and staff salaries not related to programs, that will leave an average of about $740 million annually to support direct distributions to Division I, membership programs and championships in all three divisions.

It is a remarkably higher number than the average over the previous eight years. During that period, that average overall rights payment was about $498 million, making the 96 percent that goes to programs, championships and distributions an average of about $478 million.

That means the effective average annual difference between the new agreement and the current one is about $262 million annually.

It would be regarded as a major increase under almost any conditions, but it seems especially large given the low expectations that had developed for future NCAA rights agreements over the last several years. No less an authority than Southeastern Conference Commissioner Mike Slive was surprised at the size of the contract. "This is a win-win result for everyone," Slive said. "The agreement exceeds what everyone thought it would be."

The 8 percent annual bump in the current CBS agreement had made the tail end of the current contract exceptionally lucrative for the NCAA and unusually expensive for CBS, which was paying the highest cost per viewer for any sports event – even more than for the Super Bowl.

Although payment schedules for the new agreement were not revealed during Thursday's announcement, it was noted that the payments will escalate more slowly over the term of the new contract than the meteoric 8 percent escalation required in the current agreement. So, while the payments for the next three years will be a bit less than they would have been under the current agreement, the payments for the next 11 years likely are much higher than what would have resulted had the NCAA chosen to see the current contract through to its conclusion.

That is good for the NCAA – and for CBS.

"CBS had escalating costs in the previous NCAA deal that have now been replaced in this new arrangement that puts CBS on solid financial footing for lasting profitability," said CBS News and Sports President Sean McManus.

The nature of the agreement also helped increase the value. Under the multi-platform arrangement, every game from the Division I Men's Basketball Championship will be a national telecast.

"It was a goal from the very beginning," said NCAA Interim President Jim Isch. "I believe it's what our membership wants. It's important for their teams to be seen throughout the country. They've got fans across this great country, and they want to have an opportunity for them to be followed. Without question, it was one of the driving factors in our decision."

Circumstances also permitted the NCAA to use timing to its advantage. With the opt-out clause in the current agreement, the Association was able to get ahead of negotiations for other sports properties. The National

Football League, Major League Baseball and the Olympics all will be negotiating contracts soon. The NCAA agreement represents about 18 percent of what would be in the market in 2013, according to a document that was distributed to NCAA volunteer leadership Thursday.

The same document also noted that the moderately improved economic condition of recent months provided a window of opportunity. "There is no certainty that continuing with the remaining three years of the current contract would ensure better economic conditions a year to 18 months from now, and there is some advantage to negotiating during a period of guarded optimism for the future," the document stated.

The size and nature of the agreement may set off new questions about excessive commercialism in college sports, but Isch said the criticism is misguided.

Noting that the late NCAA President Myles Brand would be pleased with the new agreement, Isch added: "What he would be focusing on is that this provides financial stability for this Association, and the dollars that will be generated will be in accordance with our mission. These dollars will be going back to support 400,000 student-athletes in 88 championships in 23 sports. So I think he would feel great about this."