Patterson quote

pluckeye

pluckeye

250+ Posts
I just read this in today's Austin American Statesman:

"AAS: Are you going to raise ticket prices for football next year?

Patterson: We'll look at it. The full cost of attendance is going to be reality next year. Name, image and likeness may or may not."

I have a somewhat vague sense of what this means, but I'm a little fuzzy on the details. In terms of the "full cost of attendance" phrase, is the implication that ticket prices last year and in the past have not covered the operational cost of running the stadium on game day? What all is included in the full cost? Is stadium expansion (E side upper deck, suites, for example) depreciation/amortization included? Is the idea to set ticket prices on game day to break even? Make a profit? Do advertising and TV revenues factor in this at all?

At $100/persion and 100K fans, that's $10M. Anybody know what it costs to run the stadium on game day?

And I assume "name, image and likeness" is a separate issue, correct? As in, the NCAA allowing some kind of trust fund to be set up for players that they can access when they leave the college football program.

I'm not complaining, just wanting to understand these things a little better...
 
I also read, at least according to USA Today, that the total UT Austin athletics department had an operating profit of about $19M last year. I'm wondering what "full cost of attendance" means in the context of making a pretty decent operating profit overall.
 
Just remember football, men's basketball and the LHN tote the note for a lot of athletic and academic programs. The "profit" is reinvested in people and facilities for all sports. When you have a $19 million profit but are staring building a multiple million dollar arena in the face, the $19 million pales.
 
I realize the excess of revenues over expenses is reinvested back into UT in various forms, athletics, academics, etc. Mostly, I'm just trying to understand what the full cost of attendance is. What's the definition, and what is the amount?
 
Well you could start by making out a list of revenues vs. capex and opex, or you could just call the Longhorn Foundation and ask!!!

I opt for the latter, or is it the former, that always confuses me!!!
 
Let the marketplace determine the price of admission
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Taps
How would you let the marketplace determine this?
BY experimenting?
If Patterson raises the price of tickets and there is a drop off of season tic holders what % drop off would you think suggests the marketplace decided the cost was too high?
 
I agree with the Tapper, let the market place determine the ticket prices with the exception of the students.
At least it seems Patterson is looking at what is in front of him in regards to revenue flow. If the value of a 6-5 team is not worth paying 1,000.00 per seat to the Longhorn Foundation with an increase in ticket prices, those people are not going to renew. Corporations can very well decide to not renew if they feel the value of the tickets/foundation prices are not worth the benefit and would be better served to cut from the budget.
Patterson is in a tough situation. I remember the 55,000-65,000 showing up to games prior to Mack Brown. The revenue flow fell into place with winning and allowing the Longhorn Foundation to take full advantage by pushing up the foundation cost of seats and then UT following by raising ticket prices.
The market will not bear the increases with a mediocre team. Just won't happen.
If Patterson takes the tack of "beating the mule that is already pulling the hardest" by raising prices without a proper product, he will just lose more revenue.
He should probably try to keep the Foundation donors at the same rate and/or reduce the donation levels along with not increasing or decreasing ticket prices to retain as many as possible.
 
The $150 LHF minimum to reserve season football seats was in place long before Mack. If season ticket orders sell out, then raise ticket prices. If sales decrease then you decrease ticket prices.
 
The 150.00 donors have been around a long time (1980's). When Texas started winning big under Mack Brown, the donation levels were raised for new season ticket holders (demand). Upper deck sections had 150.00 donors sitting next to 3,000.00 dollar donors. UT already dropped the price of tickets for sections above the seatbacks in the upper deck. People are not going pay out big dollars for donations and tickets for a 6-6 team with mediocre coaching.
Patterson has a tough hand dealt to him, although he is kind of falling on his own sword with his coaching decision.
 
No coach was going to have this team at 8-4 with the issues Strong has faced. QB going down, Oline being ravaged, suspensions, and three strong teams not named OU to contend with. If Strong goes 6-6 next year with no improvement, then we can start to wonder aloud if this wasnt the right hire. So far, I cant complain too much. It is still a process. And we dont have Ricky Williams on this team. Its a different time, a different era. Strong cannot be compared to Mack. Things are not the same.
 
I think the OP is forgetting about, and possibly Patterson conveniently forgetting about, the real bulk of the revenue associated with the "game day" experience. Not even considering the percentages and/or rent associated with the food venders and merchandise sales, the average required per ticket annual donation for seats between the 30s has eclipsed $40,000.00. That's per ticket and is required to remain eligible to purchase the ticket. Below the 30s and end zone seats range from $500 up.

Now granted, there are quite a few seats that are grand fathered in and paying much less for the time being, but many, many have been turned over in the last 15 years and there is an average of a 2% turnover per year on the west side, which has the lowest turnover in the stadium. Boxes, of course, are a lot of money.

There are 6 homes per year. Even if the total average donation was only $2,000 per seat, or $333.33 per game, (and I suspect it is higher but do not know this for sure) that is another $33 million per game.

How much can it really cost to play a game in that stadium? The ushers are high school students working for community service hours. Could there be 1,000 workers? That is quite a few without the ushers and without the concession booths(which are staffed by the venders). But if it was 1,000, working for 6 hours at an average of $20 per hour, that would be $120,000.00. Lights, security, buses, food and drinks for the boxes, filming, special services, blah, blah - still how much? Another $380,000 for a total of $500,000 per game? Double that. $1,000,000 per game. Still chicken feed compared to the revenue.

They are making plenty.
 
Op is about revenue and ticket/package revenue. Demand vs supply. Demand doesn't exist with 6-6 teams and devalued tickets/game day experience. The team went a mediocre 6-6 with bad losses at home and people couldn't give tickets away. People are going to drop out until that changes, unless there is a drop in prices/donations. The 150.00 donors will be there, as they were through the bad times before Mack Brown. The 150.00 donors are the ones that paid the freight through the lean time. The band wagon fans that jumped on board when Brown was coach are the ones that will bail unless donor levels are reduced along with ticket prices. I watched the empty seats increase as the year went on.
I don't envy Patterson on putting the package together to retain Foundation donors and determine ticket prices, he is walking a fine line. If I were in his shoes, I would probably risk losing some of the 150.00 donors and raise the minimum foundation donation to 100.00 per seat and hope they don't bail, lower the remaining foundation donors by 100.00 per seat and tier price the game day tickets. Then pray the 6-6 coach we have doesn't have a losing season in 2015.
 
I was not forgetting about the LF donation, as I've been making those donations for 20+ years myself. I just wondered what he meant by the statement, exactly; the question he was asked only asked about ticket prices. And I just thought his answer was a little vague, as quoted in the paper... "the full cost of attendance is going to be reality next year." The implication, I thought, suggested that the "full cost of attendance" wasn't covered in past ticket prices, and they would go up.

Is that what he meant, or did he mean something else?
 
I took the quote to mean that the attendees were going to pay the full cost of operations without a loss in revenue. Maybe I am reading too much into the quote. I saw an increasing number of empty seats as the season progressed. I think he has to make revenue decisions prior to 2015 Longhorn Foundation donation renewal and 2015 ticket applications. I think he is concerned about a decline in both donations and ticket sales. (demand and revenue). Most businesses have down turns and have to adjust. I just don't think he wants to make cuts that declining revenue would call for so he is looking at replacing lost revenue with increased donations and ticket prices. The problem is he may make the decline worse.
Winning solves these problems, but that didn't happen. So does he cut donations and ticket prices and keep more season ticket holders or does he raise donations and ticket prices and hope the current coach can win big and sell out in October/November ? Tough decisions.
 
You all really hate Charlie Strong that much to call him a 6-6 Coach already?

We will be fine with Charlie. It just takes time.

I'm all for reducing tickets. HOWEVER, for the record, there are a few storied programs who have bad season and still don't have a drop in attendance (see Michigan, Nebraska, Florida, etc). Guess we are not in that realm....
 
What Michigan games have you been watching?

What Florida games have you been watching?

What Nebraska games have you been watching?

Texas is selling over 90,000 tickets per game, now only about 70,000 showed up against TCU but showing up and sales are a different story.
 
$40,000? Are you saying that is one season donation? Holy crap, that many people will pay for this team?
I sweat out my $750 NEZ amount every year but just hate to give it up. I just cannot imagine spending that much and then being embarrassed like we were this year and last. Obviously I love the Horns cause I keep coming back but I cannot imagine paying that ($40,000) kind of money unless it is a suite.
And if the TCU game had been any day but Thanksgiving the crowd attendance would have been higher.
 
Charlie has not done anything that Mack Brown would not have done to this point.

The Salty defense we had this year, was just as salty if not more salty this time last year.

The offense was just as inept this year as last year.

My judgement off Charlie is still out but nothing has changed in 12 months.
 
I didn't see the exact context of the Patterson quote, but I suspect he was making a reference to expenses are going up because of this:

IRVING, Texas -- The Big 12 has announced it will cover the full cost of a student-athlete's attendance and offer multiyear scholarships.

The league announced Monday that Big 12 schools will cover expenses beyond tuition and fees, room and board and supplies that they deem "reasonably related" to attendance.

The league will hand out scholarships that run at least as long as an athlete's period of eligibility.

The Big 12 will also offer aid to former student-athletes seeking to return to school and earn their degree.

The new bylaws will go into effect on August 1, 2015.
 
Thanks pluck, that sounds more reasonable.
I certainly hope we see no increase, either donation or ticket price until we see serious product improvement! Right now I am hoping I can continue to manage cost just because of passion for the Horns, but would love to be wrangling with my conscience about an increase with a 9, 10 win team.
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Hookem
 
$40,000 per ticket between the 30s!!! Lower level!? Holy crap!! I got in the LHF when it started and have 4 tix between the 45 and 50 in the middle of the UD. I have a total annual $150 donation for all 4 tix. Unreal!!
 
The economics seem simple enough: attendance was down (I don't recall seeing any games this season where the stadium was 100% full), so decrease ticket prices to encourage more fans to come to the game.

I also think selling beer in the stadium will help keep the number of people in the stadium up. There were a few games this season where I watched from the Alumni Center across the street because I didn't have a ticket, and every time, the Alumni Center filled up around halftime with people who didn't return to the game (regardless of the score) because they wanted to have a drink. Serving beer in the stadium should help to correct this. (Also, the revenue created by selling beer in the stadium might help to offset the need to increase ticket prices.)
 
Does anyone have information on the new combined Donation/ football ticket application? I received a call that we would be receiving a combined Longhorn Foundation / Football ticket application in about 30 days. A very nice polite young man, but couldn't really explain why the donations were going to be combined with the ticket application.
 
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