Earlier this week, the UCLA Bruins and Under Armour announced the most lucrative apparel contract in the history of collegiate athletics. The deal, $280 million over 15 years, tops Ohio State's Nike contract by $28M and Texas' Nike deal by $30M.
The LA Times notes how it'll be broken down:
UCLA will receive $15 million in cash up front, according to a person with knowledge of the agreement who was not authorized to speak publicly. The school will subsequently be paid approximately $11 million annually in rights and marketing fees.
Under Armour has agreed to supply about $7.4 million worth of clothing, shoes and equipment each school year and contribute an additional $2 million over the next eight years for upgrades at facilities such as the Morgan Center and the Acosta Athletic Complex.
By comparison, that's nearly four times what the next highest school, Arizona State, is making in the Pac-12 conference.
In ASU's latest deal with Adidas, which pays the school $4.225M each year, it places them in the top 15 in the country. (AzCentral.com said it was top-10 when it was signed in December of 2014 and Business Insider had it 9th last September, but Campus Insiders did not include it in October of 2015.)
Two hours south in Tucson, Arizona's current deal with Nike, which now runs through the year 2025, is worth $3.80M. Per the Arizona Daily Star's Bruce Pascoe, the breakdown is as follows:
...The new UA-Nike deal gives the school $2.15 million worth of gear and equipment, with escalators that raise the amount to $2.6 million by 2023, plus the $500,000 in cash.
The 10-year deal also incorporates $680,000 worth of individual payments Nike gives to coaches, ranging up to the $200,000 that football coach Rich Rodriguez and basketball coach Sean Miller each receive.
U of A's Nike contact extension wasn't even needed -- the previous one ran through 2019 -- but "they gave us more than double and sped up the process" by tearing up the old contract athletic director Greg Byrne said. "We really appreciate it."
While Arizona would have surely been able to get more from Under Armour and Adidas, the school's relationship with Nike, especially in basketball, was held in high standards.
"Our relationship with Nike on the basketball side, I can’t imagine a better, more rewarding relationship … with the tradition and history and how it is today," Miller said. "We love our affiliation with them and our guys get treated like gold. They really do."
Now, with the new UCLA deal, the impact on Arizona is obvious.
It absolutely blows the Wildcats' Nike deal to smithereens and will allow UCLA the ability to upgrade their facilities. It also impacts their marketing tactics to the hallowed Southern California prospect base that Arizona relies on so dearly for football and somewhat for basketball.
While it may seem unfair, the Bruins are in the nation's second largest media market and metropolitan area (13 million people), so Under Armour is 1) overpaying to get its brand on the West coast and 2) paying more because they have a larger market who will be immersed in their brand over time. Tucson, on the other hand is the 53rd largest metropolitan area (1 million people) and provides Nike with a much smaller target market. (This is excluding school reach nationally which probably favors UCLA, but could be argued the two are similar.)
Overall, these are the most up to date apparel contracts in the Pac-12 according to released reports.
Numbers have been annualized:
- UCLA - Under Armour- $18M
- California - Under Armour - $4.76M (goes into effect 2017/2018 - current deal with Nike is $2.15M)
- Arizona State - Adidas - $4.225M
- Arizona - Nike - $3.8M
- Washington - Nike - $3.51M
- Oregon - Nike - $3.45M
- Utah - Under Armour -$2.416M
- Washington State - Nike - $2.3M
- Oregon State - Nike - $2.197M
- Colorado - Nike - $2.115 (Contract runs out this year)
- Stanford - Nike - Unknown
- USC - Nike - Unknown
(Private schools do not have to release figures.)
The LA Times additionally writes about the current USC deal:
USC is in the midst of a combination deal with uniforms made by Nike and merchandise coming from Nike, an in-house brand and a Texas company called Silver Star Merchandising.
I would assume USC's contract would be something similar to that of Oregon or Arizona, but this new deal will give the Trojans some bargaining power when their current deal ends.
In conclusion, this sort of agreement shows what it takes for smaller companies to begin making a name for themselves. Prior to the last three years or so, Under Armour had Maryland and relatively nothing else. But since, they've made it their goal to infiltrate the market and they've done so in a big way. UA has signed Stephen Curry, Cam Newton, Jordan Speith, Tom Brady, Bryce Harper, Buster Posey, Michael Phelps, Notre Dame, and now UCLA - some of the biggest names and brands in athletics today.
The sports apparel landscape is changing and the only question is, how does Nike and the rest of the market respond?
Editors Note: A previous version of this article stated UCLA brought in $11M a year, while the correct number is $18M. We apologize for this math error.