Michigan AD Warde Manuel says revenue sharing could lead to in-stadium advertising

Michigan Wolverines football games have long been known for a fairly pure gameday atmosphere without advertising at the Big House. With the ever-changing landscape in college sports, that could be something that changes in the near future.

Speaking on the Conqu’ring Heroes podcast with Jon Jansen, athletic director Warde Manuel was blunt about the possibility of revenue sharing coming to college sports potentially affecting sponsors appearing in the Big House.

“We’re going to pay be paying our student-athletes more money. Our budget is going to grow,” Manuel said. “It means we’re going to have to look at new revenue streams. Also look at our expenses and making sure we control our expenses. And so it’s going to be a combination of both additional revenue that we need to look at — because this is additional payments that we have to make to our student-athletes — as well as reduction of expenses where we can.

“The goal is to continue for our teams to perform at a championship level, and to continue to drive the success that we’ve had here for our history, but particularly in the last five to 10 years, it’s really been phenomenal what our student-athletes and coaches and programs have accomplished.”

Manuel says that Michigan is going to be deliberate about listening to its fanbase and supporters in the best way to increase those revenue streams. Whether it be the appearance of ads, ticket prices going up or otherwise, the reality is that these are things that are all in play with $50 million in costs added in the coming years to the athletic department’s budget.

“There’s no commitment to doing it, but one of the things that stands out is in our stadium, in Michigan Stadium,” Manuel said. “We have prided ourselves on a history of no signage, no advertising in Michigan Stadium. As our fans go to other locations, they’ll see how people have utilized their stadiums to bring in revenue.

“Now, the good news is, we have a source that is untapped at this point in time. Not that we have plans right now to do that, but that’s one of the sense of questions that we want to get our fans to say: How would you like to see us develop revenue streams that would support our student-athletes? Is it ticket price increases? Is it through corporate sponsorship? Is it through looking at other premium options that others have, those kind of things?” 

He continued: “We’re constantly trying to look at and elevate what our fans want, what they’ve talked to us about, what their interests are. And that has been very successful and very well received by our fans. We’re constantly trying to figure out ways to generate additional revenue to support our student-athletes, our coaches and our programs.” 

The landmark House vs. NCAA settlement revolving around paying collegiate athletes received preliminary approval from the US District Court on Oct. 7, putting schools one step closer to being involved in student-athlete compensation when final approval hits, scheduled for April 7, 2025.

2025-26 academic year, anticipated to be between $22-23 million annually. Before the ruling, athletes could only be compensated via scholarships and Name, Image and Likeness (NIL) opportunities funded outside of the university.

In addition to the changes to revenue sharing, all Division I athletes who participated in 2016-21 are eligible for NIL backpay with the courts deciding that participants during this time were prevented from profiting from NIL. Parties included in the suit negotiated a settlement that will pay almost $3 billion in damages to those involved in the case.

Michigan’s involvement in the settlement will be $1.5 million less per year from NCAA revenue distribution over the next 10 years to cover its part of the costs. U-M will have no say in how the money is distributed. As a result, all NCAA sports now have roster limits and scholarships can be provided for as many available roster spots as opposed to a cap per sport.

Revenue-sharing payments are expected to increase each year to maintain a proportional share, and U-M says that if the department decides to hit scholarship limits for all of its teams, education costs are expected to increase by $29 million annually.

Manuel said in his email release that the combination of increasing revenue and reducing expenses in the department will require about $50 million added to the budget each year.

“Michigan Athletics has always been a self-sustaining unit of the university,” Manuel said. “Unlike many athletic departments across the country, we do not receive funds from the state, the university or any student fees. All revenue that the department receives through conference media rights, licensing, ticketing, sponsorships, donations and other sources is used to fund our annual operating budget in order to support our teams throughout the year.

“We intend to maximize the revenue sharing opportunities presented by these new policies to support and recognize the NIL contributions of our student-athletes to the full extent allowed by the NCAA and the agreed upon settlement. Their hard work in athletics and commitment to the community and classroom help drive our collective passion for Michigan Athletics. We are continuing to assess the number of additional scholarships that our department will be able to fund, but we are firm in our commitment not to eliminate any sports or reduce the number of scholarships we currently offer.”

NIL will still be a crucial part of U-M’s plan to address the needs of its athletic department, Manuel says. And contributions to both the department and the collectives are encouraged.

“There is still a significant need to support the NIL initiatives of our student-athletes,” Manuel wrote. “For the foreseeable future, collectives such as Champions Circle will continue to be an important source for our student-athletes’ NIL opportunities. NIL support will continue to play a role in our success, especially through recruitment and retention of student-athletes.”