Yesterday's online edition of USA Today featured a short comment on BCS director Bill Hancock's meeting with officials from the Department of Justice on July 30. It quotes Hancock saying "I went into it confident that the BCS complies with the law, and I left the meeting even more confident". So what does that mean for the future of the BCS?
Obviously all major NCAA sports are somewhat suspicious to violate US antitrust law to some extent. The NCAA requirement for athletes to participate without any financial compensation exceeding regulated sports scholarships is a clear sign of a heavily regulated market. Men's Basketball, as well as College Football are huge sports industries generating substantial TV revenues without paying their athletes market wages. Now the Football is somewhat special: It has introduced the Bowl Championship Series (BCS) and the mechanism that determines each season's champion is somewhat unique. A computer calculated ranking selects the top teams into 5 BCS bowls. The top two teams compete in the BCS championship game. By determining Football conferences who automatically qualify for the BCS system a kind of two-class society of colleges was formed and some face a substantially lower probability to play in a BCS game and benefit from TV revenues because they are in the wrong conference. Put simple: the BCS could be seen as a cartel.
So far the current system has survived all allegations and criticism and pro and con lobbying is continuing. If Bill Hancock's optimism is justified the BCS might have won another battle. Economic theory would say that consumer welfare might have taken another hit.
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