New Michigan Nike Contract Reportedly Worth $169 Million
By Matt Snyder
According to multiple reports, like the Tweet below from Rod Beard of the Detroit News, the University of Michigan‘s newly-signed apparel contract with Nike is to be worth a total of $169 million.
#Michigan's new deal with Nike is for $169 million total.
— Rod Beard (@detnewsRodBeard) July 15, 2015
Just under half of that value is going to come in the form of apparel, but the University of Michigan is going to rake in nearly $89 million in cash money over the life of the 11-year contract. Here’s the value breakdown:
The crazy thing, though, is that Nike reportedly was not even the highest bidder in the battle to win the Michigan rights. In fact they may have been the lowest bidder.
Most outrageous part of the Nike-Michigan deal for $169 million? Sources tell me Nike WAS THE LOWEST BIDDER.
— Darren Rovell (@darrenrovell) July 15, 2015
I’m guessing the other bids were very close. Michigan (and their fans) seem to view their athletic identity as being wrapped up with Nike, so it’s not altogether surprising that they would sacrifice a little bit of money in order to go back to the sneaker giant. I would guess the other bids were very close, however, because they probably wouldn’t sacrifice tens of millions of dollars. But who knows? It’s already crazy money, so maybe they were OK with not raking in crazy, crazy money.
Alejandro Zuniga, currently of MLB.com but formerly of Michigan Daily, puts the astronomical number in perspective for us.
Michigan’s deal with Nike is worth $169 million over 11 years. That’s $42,000 a day.
— Alejandro Zúñiga (@ByAZuniga) July 15, 2015
To put that in perspective: Michigan will make as much money from Nike each day as the average American earns each year.
— Alejandro Zúñiga (@ByAZuniga) July 15, 2015
But not only is the apparel contract a lot of money compared to us normal people, it’s a lot of money even compared to other crazy major college sports apparel contracts.
A new bar was set for college sports apparel contracts, but don’t expect Michigan to stay on top forever. This number will simply be the new target when it comes time for the next big-name school to negotiate a new contract.
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