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MICHIGAN STATE UNIVERSITY MEDIA CONFERENCE

August 20, 2009

MARK HOLLIS: Good afternoon. I'm Mark Hollis, director of athletics at Michigan State. It's good to have you here, and we're here today to announce an event that we're going to call the Celebrate the State series, which is a unique football scheduling concept between Michigan State University, Central Michigan University, Eastern Michigan University and Western Michigan University.
To start off, I'd like to thank the athletic directors from those three great institutions for joining us here today. I've got Kathy Beauregard to my left from Western, Dr. Derek Gragg from Eastern, and Dave Heeke from Central, and they'll all make comments when I'm finished here.
I'd also like to thank Greg Ianni, who I think is in the back of the room somewhere, for really conceptualizing this strategy and bringing it forward. It's something that when you sit back and you look at it, it is very unique, and there's a lot of thought and a lot of process that went in by all four of these institutions in putting this together.
We compete on the field, and we're not going to make that secondary in anything. That's why we're in the business is to take our young student athletes and put them out into a field of competition. But the economic impact and the collaboration of these four institutions is enormous, especially in this situation.
Coming off the 2009 NCAA Final Four down in Detroit, MSU continues to strive to lead and to provide a positive economic storage for the state of Michigan. I think all four of us up here, as you look around intercollegiate athletics, you understand the processes that we're going through, and when you compare that with what's going on in the state of Michigan, the economic pressure in our industry is very intense, and that's one of the reasons why we came together and started talking about a concept like this and where it could go.
Like many companies, we're looking for ways to do business in a different way. Commissioner Delaney talks about 250 teams in the Big Ten that travel to Florida on an annual basis. That's a lot of travel. That's a lot of expense. As you look at football programs, you look at things like team guarantees, you look at travel expenses, and you put all those factors into an equation and you step back and you look at the level of competition that's available in this great state and how can we compete in such a way that that has great financial return for each of us but also gives us an opportunity.
One of my phrases in my mission statement is the word "celebrate," but it's how can Western Michigan, Eastern and Central celebrate when they come to East Lansing, and likewise, how can Michigan State celebrate throughout the state of Michigan, and that was really at the forefront.
There was a 2007 study done by the Anderson Economic Group, which really put it in tune with me, and it's the number $11.8 million is what's put into the average football game that Michigan State participates in back to the state of Michigan. That's a big number. When you compound that out by seven, eight games that might be played in this state and you look at what all these institutions do, those are big numbers. That's money that becomes available to this state that wouldn't be there if football is not taking place.
It's good business. I think as you walk through and you look at the detail of what we're putting together here, we're definitely all winners, but the people of the state of Michigan are the big winners. Again, that's why we're stepping forward with this program.
The concept is in line with what I think all of our presidents and our boards are striving to do on an annual basis, and that's drive economic value to the state of Michigan. Each of us have examples of that on our campuses. President Simon has been unbelievable with bringing the IBM Research Center to campus, with expanding our medical schools out to Grand Rapids, Detroit, Traverse City.
That's what we're trying to do with sport, with football, is drive that economic value back to Michigan.
The greatest, and if I can put this into some parameters, and we all look at our scheduling and you look at why you do things, you look at the costs associated with taking a football team, which is like traveling a small army, across states to various locations like Florida or like Alabama, and then you look at the cost of travel in-state. You look at the type of money that's spent by fans, whether it be through ticket sales, through travel, through overnight lodging, through restaurants, food and drink; that money is going to stay in the state of Michigan with every one of these games that's played, and that's critically important to us.
We're very much -- all of us are very much national programs, but at the same time, this is an opportunity for us, and speaking for Michigan State, we're going to continue to have seven home games every year, but this is an opportunity for all of us to come together and have games that are going to be maintained within the boundaries of the state of Michigan.
The economic value to the state for me was one of the biggest driving factors for us putting this all together.
The Celebrate the State football series itself is going to be 12 games that are going to be played over ten seasons; through 2020 is the last potential date that we would have a game. Michigan State will host Central Michigan -- I'm trying to do this in alphabetical order, I think. Central Michigan in 2011, 2015 and 2018 here at Spartan Stadium, and in 2012 the Spartans will travel to Mount Pleasant.
With Eastern they'll be here 2012, 2014, 2016, and we'll be traveling down to Ypsilanti in 2018 or 2020 pending some scheduling that we're looking at there.
And then Western, 2013, 2017, 2019 at Spartan Stadium, and 2015 we'll travel over to Kalamazoo.
I've run this past our commissioner, Commissioner Delaney. He's very much an advocate for this series. I've talked to a number of my counterparts in various locations of the Big Ten. They're very supportive of what we're trying to do, and I think it speaks to how the Big Ten and the Mid-American Conference really collaborate on so many different things, whether it be officiating, scheduling, and quite frankly, how we do business as athletic programs.
For Michigan State we're looking forward to the opportunity to host these three institutions which we have in the past here. Good sportsmanship can be a key, I think, in each one of these games. We're all going to step forward with a strong initiative on maintaining great sportsmanship. At the same time we're looking forward to painting those three towns very green when we travel to those institutions and really extending the Michigan State brand out like they have when they have attended or participated in games here in East Lansing in the past.
So that's a brief overview. I think all the details are in the release there. I'm really excited about this. I think it's great for the state. I think it's great for these four institutions, and we're really looking forward to it, to proceeding.
I'll let each athletic director up here to make a brief comment and then if there's questions and answers about this series we'll field those at the conclusions. Kathy, would you like to start?
KATHY BEAUREGARD: Thank you very much, Mark. It's an absolute pressure for us to be here today to share in this very exciting announcement about Celebrate the State. We have a philosophy at Western Michigan; it's always a great day to be a Bronco, but it's always a great day to be a member of a higher education institution in this great state of Michigan, and I can't thank Michigan State enough for this opportunity that they are providing to our institutions, the Mid-American Conference and the other two MAC schools that are participating in this.
I'm not sure if there's any other school in the country, any other conferences in the country, that can say what is happening here today, and on behalf of our institution, our president John Dunn, all of the Broncos, our community members and our alumni, I will tell you that we are extremely and proud to be a part of this collaborative effort, a great group of individuals getting together, all believing in the same thing, that what's best for the state of Michigan, for our student athlete experience, for the entire population across the state, this is extremely exciting.
I've been a Bronco a long time, and I'm not sure if we've had one of the more exciting announcements of bringing Michigan State University football to Kalamazoo, Michigan. And on behalf of all of us, thank you so much again, and we are looking forward to playing here this year, many more games, and I can't say enough about what we know this is going to do around the country for an announcement, and what really should be happening in higher education and intercollegiate athletics right now are partnerships like this. So thank you.
DEREK GRAGG: I'd like to second a lot of what Kathy said, and this provides a great opportunity for exposure for our institution and the other Mid-American Conference institutions. It's very difficult to schedule football games, and we know a lot about that. So the collaboration, the partnership that we have here today, we hope that we are leading by example and leading the country in this way, and when you come to town, you don't have to paint the town green because we will already be green there at Eastern Michigan.
On behalf of our president, Dr. Susan Martin, who's been very supportive and our board of regents, we really appreciate this opportunity.
DAVE HEEKE: Thank you, everyone, for being here today, and certainly on behalf of Central Michigan University and our students, faculty and staff, our president, Kathy Wilbur, we're delighted to be entering into this kind of partnership. This really collaborative effort has been echoed before, really what I think is a landmark day for football in this state, a great state, a great football state, and we are certainly appreciative of what Michigan State University has done, their administration, the coaching staff, the commitment to make this work.
As Derek mentioned, football scheduling is incredibly complex and very difficult from all levels. This only makes sense economically, it only makes sense for all of our student athletes, and it is truly a way to celebrate college football in the state of Michigan.
Again, Central Michigan is thrilled to be here, thrilled to be at the table, and we're looking forward to having the Spartans come to Mount Pleasant, as well as our team coming here to this great venue and this tradition-rich program and competing against Michigan State, so thank you.

Q. Dave, I know when you guys have come to Spartan Stadium in the past, it comes in anywhere from three quarters of a million to a million dollars. With this kind of agreement do those get lowered on your visits?
DAVE HEEKE: Yeah, it's a business model. There is a business model behind this. All of us have sat at the table and talked about those situations and the benefits economically to each institution.
It's very, very difficult for an institution like Michigan State to pay guarantees. It's a challenge on their budget, just like it is for us, a real challenging environment to secure the types of guarantees that are important to maintain the level of financial support that we need.
Really, I think this is an effort that combines all of those things, keeps everybody whole economically, but it's the right thing to do. It's the right way to put our teams on the field and to compete. We're really comfortable with the financial terms of the agreement. It works on everyone's part.

Q. Mark, can you tell us anything about those financial terms and also about the ticket distribution when you travel to the various stadiums?
MARK HOLLIS: We're working in a framework right now that -- not to put numbers out, but they're numbers that were put together with a lot of respect for where each other's budgets were brought forward, I guess, when we sat at the table. Quite frankly we haven't come up with the final numbers.
We're working within a framework as we move forward because some of these games are so far out, we want to make sure that we've got the right trigger. But as the AD as Michigan State, I can step back and feel extremely comfortable, and I think everybody at this table can.
It's not a situation where you have to -- like I said before, where you have to travel long distances and you're looking to recoup significant travel costs, so that was one component that we could take out of the equation and kind of relieve each other in the process.
While the final numbers aren't put to bed, we're all very comfortable with the outcome of where that's going to end up.

Q. For Derek and Mark, is there any chance a game in Ypsilanti could take place on a day that the school in Ann Arbor has a home game, as well, because that will be quite a day, or is that something you guys would like to avoid?
DEREK GRAGG: It's always a challenge with us being so close to Michigan, but we think that this game, no matter when it's played, for our people, our constituency, is going to be cool. We'll probably bill it as the greatest day as far as attendance in Eastern Michigan history, and so we won't worry so much about what's going on down the road and concentrate on what we have going on.
But I'm excited about it, and I think it'll draw well no matter when we play it.
MARK HOLLIS: And I think that statement makes a great point for what football means in this whole state of Michigan when you look at the institutions that are up here and you add the University of Michigan, you add the Detroit Lions and you look at what goes on, it provides a lot of competition for us in so many different aspects. But it is a great state for the sport, there's no question about that.

Q. Following up, can you address ticket distribution and what happens to you going on the road?
MARK HOLLIS: We're going to get as many as they'll give us, and we'll give them as many as they want here. I think they're going to go forward. It's got to be a great opportunity for the alumni and fan base from each institution, but there will be a good number of tickets available for Michigan State fans, and we'll go through a distribution process.
I think it's going to be one of the highest demand tickets for Spartan fans for a football game that we've had in a long, long time, because there's going to be a lot of -- if you can step back and really look at the opportunity for Michigan State to travel to these three different venues, what that town is going to turn into is very much a celebratory type of an atmosphere. Michigan State people are going to want to be there. It's going to be like the Final Four in a lot of aspects, in that desire and that demand to be part of the event. It's going to be special, no question.

Q. Kathy, would you talk about at a program like Western where the NCAA is watching very closely the numbers, how much does it help to have Michigan State come where it helps your average attendance numbers?
KATHY BEAUREGARD: Oh it's tremendous for us. There's no doubt that in the Mid-American Conference attendance is always an issue. For us to be able to host at home an institution we know is an hour and 15 minutes down the road surrounded all around this state with alumni along with ours, it is going to be a significant opportunity. Not only is there going to be a tremendous demand for the Michigan State fans coming our way, but you can also see what that's going to do for our fan excitement and commitment, the chance for us to put those in our season ticket packaging, some really great marketing opportunities that are going to be once in a lifetime.
We've hosted some really high profile teams at Western Michigan in the past. Nobody ever at the level of Michigan State University football coming to Waldo Stadium.
I also believe it's going to be an incredible opportunity for all of the student athletes and the prospective recruits around the state of Michigan because this is really, from our coaching staff's perspective, really going to be an incredible opportunity to be able to allow for recruitment of student athletes.
DEREK GRAGG: I'd like to add to that. Them not requiring us to play at Ford Field like some teams, we've had negotiations with other teams. Having this game on campus means a lot. It's our home venue, and the revenues and not having to share that with another venue and being out of the city and away from the campus is major.

Q. Mark, I was hoping you could elaborate on the $11.8 million for home games. Could you just explain that a little bit more?
MARK HOLLIS: What we've done is there was an economic study done on Big Ten football in the state of Michigan, including Michigan and Michigan State, and it took into consideration -- again, it was a very conservative number, but it took into consideration at these games did not take place at Spartan Stadium or down in Ann Arbor, what would be the lost revenue by not having it, as far as an economic impact on the state. That number came in, I think it was $77 million for a year between the two institutions, and that was compared to the Super Bowl, which came in right about $52 million I believe was the number. It was a comparison between the value of college football in the state versus one Super Bowl down in Detroit.
When you step back and you look at that, I think the state of Michigan does a lot of things to try and secure businesses and events in this state. I think -- I don't think we're ever taken for granted, but I think there's a situation here where you have college football, you have Michigan State, you have all these institutions, you have the University of Michigan that ought to be celebrated for driving that kind of economic value back.
We all have a lot of challenges. $13 million of our budget goes to scholarships to educate student athletes, and there's a lot of expenses that generally these revenues get returned right back either to campus or to the University, and those numbers aren't equated into that economic study. That's purely fans coming to a game and spending dollars and traveling and housing and what's the ripple effect of those dollars that get spent.
The study that was done was Big Ten football. It was games that are played in Ann Arbor and East Lansing. I've always used that as a reference point because I think it's a very strong number in representing what we're about economically to the state.

Q. This is a question for any of you. Was there any contact with Bill Martin to see if Michigan wanted to get involved with this, as well, since at least every year they play at least one of the four schools?
MARK HOLLIS: I informed Bill that we were doing this, yes.
KATHY BEAUREGARD: We decided Mark can answer that question.
MARK HOLLIS: I think everybody's schedules were different, and I firmly believe that Michigan State is the University of this state. I've always claimed I want to have a high school attitude at a big-time college athletic program, and that's what I strive to turn this place into, and I think part of that is being part of the community of which you're operating in, and part of the community are the friends that I have sitting at this table.
We want to be in these venues, Coach Dantonio wants to be in these venues, and we're going into this wholeheartedly, that this is very much a positive not only for our football program but for our state, and that's why we did it.
Tim Curley I talked to a little bit about it at Penn State, and he's really intrigued with this type of a setup. I think you have to kind of step -- you have to form your schedule right. I don't want to hold it against Michigan because they're not participating, but we had a schedule with this thing after a little bit of work really fell into place. We're still trying to tweak a couple things to expedite the conclusion of the series, but it has to fit in your schedule. While we're throwing in Alabama and we're throwing in West Virginia, this was very much in the back of our minds that we wanted these 12 games to fit in our schedule.
KATHY BEAUREGARD: It's a really critical issue for us because we're coming off of a 9-and-3 season last year of the regular season. We're looking this year at, as all of us are, the more regional scheduling we can do is what we really all need to try to do, and for us this year we're actually playing in Michigan, Michigan State and Indiana, so our non-conference are all within the region. We don't have a flight. Last year we were off to Idaho and some other opportunities that really do cost us a lot of money when it comes down to the opportunities, and Michigan has offered us all that opportunity to play in their venues, which quite honestly, up until six years ago, the Broncos hadn't been there for over 50 years.
So this collaborative effort, and I can't tell you about the partnership that we all feel, of enhancing this state, enhancing being more cost effective, smart business, we're all thinking differently down the road.

Q. Mark, can you talk about the risk-reward factor you're putting on your coach in this regard where some people think you don't have much to gain and a lot to lose if you play these teams at home and --
MARK HOLLIS: I put all kinds of pressure on him, this one is nothing. (Laughter.) Yeah, all four of us went through the risk-reward of this process. I think you have to go through that. Mark was very engaged in the process as we went through this. He's very supportive of it. I mean, he realizes that going into any three of these venues is going to create an environment that's going to be a challenge for the team because that's what Mark is about, is getting a challenge and then moving forward with it and trying to meet that challenge head-on.
I'm not going to guarantee that we're going to go into these three environments and win all three games. You can't make that guarantee; that's why you play the games. That's the risk.
The reward from my perspective and I think from all of us is what comes out of this is the experience for the student athlete, for the fan, for the alumni and then the economic value back to the state and the financial savings for each of our institutions.

Q. Will you consider doing this in any other sports? And you've talked since you've become athletic director about these three as individuals. Did that trust factor help to get a deal done?
MARK HOLLIS: I have great respect for all three that are sitting at this table, and hopefully they do for me, as well, and I don't think it could have happened had that trust factor not been there. We're sitting here making an announcement still with a lot of things that are still loose and open, but we all have the confidence that those things are going to be resolved in a very cooperative manner, so of course.
The other sports, we're including a basketball series with Eastern because of the timing of the games on the road. Eastern was kind of put at a bit of a disadvantage, but it is what it is, here's the schedule, here's kind of how the mix happens, and because of that we've added a basketball series that's going to take us down.
I think from my perspective you're going to see a lot of regionalization intercollegiate across the board. The Mid-American and the Big Ten make a lot of sense to do things going all the way through the order of the sports.
A lot of our teams are participating on an annual basis already, but I would guess that not only in the traditional but maybe the non-traditional seasons you'll see a lot of competition between these institutions. We haven't talked about it, but I'm guessing.
DAVE HEEKE: I think so many of our programs do compete with each other already that we've got a great relationship, all three of our institutions, with Michigan State, and we're competing with most of our teams already, so we want to continue that, as well.
MARK HOLLIS: The only one that doesn't trust me up here is Derek because usually every time I call him asking for one of his coaches --
DEREK GRAGG: No comment. (Laughter.)

Q. Mark, in general terms, without the numbers, can you just explain a little bit more the arrangement? It would be smaller guarantees --
MARK HOLLIS: Yeah, I think in general --

Q. -- when you go to the other places?
MARK HOLLIS: Let me describe real briefly to you, there's a number of ways you can schedule football games. One is a home and home, where virtually no money will exchange, or you'll have a set amount that will exchange. Another is where you have a team come into East Lansing and you pay them one guaranteed amount, that number. Those numbers nationally are exceeding a million dollars to buy a team to come in and play you one time.
Another is to do a two for one. I think you'll see situations like that. Florida Atlantic is an example that we had where you'll pay a guarantee for two of the games and then you have the travel expenses associated with a game to go down to their place.
The example here, speaking in broad general terms, is two of the games will basically be that home and home, and then the guarantees for us will be brought down to have to pay for those additional two games.
And the part that's really taken out of the equation, there's no losers in the business model, but the part that's being taken out of the equation is the reduction in travel expenses that none of us have to take on as we move forward. So that's the piece.
So the piece that we're sending our teams out or we're having teams come in is gone, and the great thing is the money that's coming in for all the teams is staying right here in the state. That's what was important.

Q. I just wanted to ask Mark or Kathy, is this kind of signaling, this kind of idea more of a moving away from the trend of scheduling for so-called neutral home venues? Again, there was supposed to be the Ford Field game between you all this year, but are we just going to be seeing less of that in the sports landscape?
KATHY BEAUREGARD: We actually, as you know, have worked with and really appreciated Michigan State in the discussion with Ford Field this year. That was the decision that we believed financially was not the best model right now. What Western Michigan did with that is we actually are only hosting five home games this year, which is the first time in a long time we've only had five home, but worked with Michigan State with the change on that to bring the game here as the right thing to do when we knew that Ford Field was not going to be the answer for this year.
So I do think that in many cases there's still a lot of opportunities for neutral sites. Experiences, it just really needs to be the right fit, probably more so for us in the Mid-American Conference, potentially in basketball, than maybe in our football program.
I just think when we got down to it, looked at the numbers, looked at everything that was involved, we really felt that the opportunity to be here and then back in Kalamazoo and at the other MAC home campuses, communities, you can imagine the excitement of our hotels, our restaurants, just the entire community knowing that this is going to be coming and planning ahead.
MARK HOLLIS: Yeah, I think neutral site games are things that will continue. Where our level of participation will be, I'm not sure. Ford Field, it's nothing against Ford Field, they put forward a very strong proposal. I think it is just the perfect storm that created a situation where we had to go back and reevaluate due to some renegotiating that they wanted to do given the economic downturn that came subsequent to the announcement.
It was nothing negative, it was just here's the financial realities of where we are today, and they were very different than when we put the package together. And speaking for Michigan State, we couldn't accept what those numbers would have been in order for us to lose a home game.
I think Florida Atlantic, unfortunately their stadium is not going to be done, and they're looking right now -- it'll be their decision, but they're looking at a neutral site game as a source of revenue for them to help pay for their stadium, of which we'll be a participant, but we'll play wherever they end up choosing, whether it be Chicago, Detroit or on the moon.
DAVE HEEKE: I might just add, as Kathy alluded to and really the willingness of Michigan State to really celebrate college football. College football on our campuses are such a huge deal to our institutions, and the chance to really just celebrate our institutions on a Saturday in our venues, we don't want to minimize that. And sometimes I think neutral site deals can lead us down that road of minimizing the impact at that it has on our students, our faculty, staff, and certainly our alumni.

Q. This is a question for Kathy and Dave and Derek. The state quite frankly in a lot of ways is broke; city budgets are tight, police are getting laid off. What do these towns in your respective communities need to do to get ready for a game-day atmosphere? Who do the school officials need to do? What do the city officials need to do, and what do you expect the game-day atmosphere to be like when Michigan State takes their show on the road?
DAVE HEEKE: Well, I think in Mount Pleasant it'll be just a calm, quiet Saturday afternoon. We'll bring Herb Deromedi back to be the head coach that day maybe. (Laughter.)
No, it will be one of the -- again, as Derek alluded to, these will be the biggest days in the history of our campuses on a football Saturday. It'll be a tremendous atmosphere, and yes, our campuses and our communities need to be prepared for what will be an enormous day, but one that will generate a lot of enthusiasm and excitement and have that economic impact that we're all looking for, to. We all play an important role in our communities in that part, and this will be a big boost for us.
DEREK GRAGG: You mentioned the travel costs, and we haven't been specific about that, but for instance, we took three flights last year at about $75,000 a flight, and then you add the travel expenses, the hotel, that's about $100,000 in travel as opposed to taking a bus. And this year we'll only have one flight. So it's a major economic difference.
Again, with this game coming on campus, that will be the biggest day in the history. We will bill it as us trying to set an attendance record, which I think will be great, and with the NCAA rules in place, it will help us with our averages throughout the year.
KATHY BEAUREGARD: And we'll be ready, there's no doubt. We will be extremely excited. Everybody is already when we've talked just about what we know is going to be needed for this to be exactly what it is. One of the other things that I think is going to be tremendous for us is just the national exposure of these opportunities, new television opportunities, opportunities for us to really promote Mid-American Conference football, along with Big Ten football, in a lot of venues where we're competing against a lot of other MAC institutions with the Big Ten. But a great opportunity for Big Ten, Mid-American Conference, Midwest, great celebration of football.
MARK HOLLIS: And I think to go to the logistics, none of our communities are ever on an island when we have an event like this. We all have friends in the state police, we all have friends on each campus. There will be meetings, there will be a lot of collaboration that will go into everything. They already have their traffic patterns in place.
We understand, I think, the intensity that's going to come in. We experience it here. When these schools come into mid-Michigan we have different crowds than when Northwestern or someone else comes into town. So you have to prepare for it, and we'll prepare for it collaboratively, but we'll also take the guidance from people that are professionals like the state police.

End of FastScripts

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