The Michigan Wolverines’ athletic department has been committed to adapting to the ever-changing world of college sports. With the House vs. NCAA settlement inching closer to approval, Michigan athletic director Warde Manuel has dug his feet into the ground on how the university plans to allocate those funds.
Michigan won a football National Championship in 2023-24, currently sits in second place in the Big Ten men’s basketball standings, and the women’s basketball team is poised to make another NCAA Tournament run. And many non-revenue sports cannot stop winning Big Ten titles.
The allocation of funds
To put it frankly, Michigan has a success problem. While the House settlement was originally decided to give $23 million to college athletes as part of a revenue-sharing metric, the number has come down to $20.5 million. And according to Manuel, it is expected to stay there if the settlement gains final approval.
Michigan’s athletic department is committed to sharing the $20.5 million with its three main revenue drivers. Approximately 75 percent of that will go to football, with the other 25 percent being split between the men’s and women’s basketball teams.
It’s apparent Michigan has the money to pay its athletes, especially since the athletic department has been self-sustaining for years, paying back every scholarship the university gives to its athletes. However, there will need to be more ways to generate revenue in order to keep up with the changing landscape.
In-stadium advertising
Manuel has already spoken about the possibility of putting advertisements inside of Michigan Stadium in 2025, and he was committed to that approach once again on The Michigan Insider Podcast with Sam Webb this past week.
“Yeah, there will be no permanent advertising,” Manuel said. “We have the Gatorade brand, and we have the Nike apparel, and we put the headsets on. But there will be nothing permanent on the scoreboard or anything that we’re putting in signage on the scoreboard, anything like that at this time.
“But there is a time. And I think part of it is putting out the survey is to get our fans to give us their thoughts about what they would find acceptable. I mean, $20 million is really $20.5 million. That’s real dollars that we have to find in terms of sharing, revenue sharing with our student athletes. So we’re cutting almost $8-9 million out of our budget for next year. We’re doing different things to drive more revenue through where we currently have revenue.”
While no one wants to be bombarded with ads, there is a balance that — if done right — could bring upwards of $10 million next year without overly impeding on the fan experience. If done, that would replace the cuts Manuel alluded to.
Committing to 29 programs
Manuel has also stayed committed to not cutting any of the 29 athletic programs at Michigan, a big statement in favor of athletes and the people that work for those teams. But the money needs to come from somewhere in order to sustain what Michigan already has.
“We don’t get any in ‘no student fee’ area,” Manuel said. “At both of the places I was at before, we got student fee dollars, and we have support from the university. And so, it’s one of those things where there’s a lot to think about, there’s a lot that we want to continue to do.
“But with the success of the 29 programs, we’re not dropping the sport at all. It’s not even been a conversation, a point in the conversation. We’re not laying people off … We’re gonna take a look at open positions and do our due diligence as to what we need moving forward. So it’s about looking at revenue, but it’s also about looking at expenditure.”
Thinking outside the box
Another way the Wolverines plan on generating revenue for players is using Michigan Stadium for events. Music artist Zach Bryan will be playing at the Big House at the end of September, and the show sold out within 36 hours.
Not only was the move a money-maker for the school and the artists, but Michigan will only get six home games in 2025 compared to the eight it had the previous four seasons. The lost revenue of two home football games is a large margin, so adding the concert is a big way to make up for it.
The fact is Michigan is being asked to cough up $20 million more than it has ever had to spend before. In a self-sufficient budget, money is typically earned and distributed until there isn’t a penny left to spend. Suppose the Wolverines want to keep up that model without adding more fees to its students and fans, asking the university to pay for the full scholarships or take away current athletic programs. In that case, in-stadium advertising and outdoor concerts are a start to getting back even with the budget.
The more success the department has, the easier it is to sell. With the recent success of various athletic programs, the time is now to capitalize on demand.
