Each school in the 1995 Rose Bowl received 6.5 million and each team in the Orange Bowl received 4.2 million. Contracts with television companies and endorsements from sporting good companies is a major source of revenue for colleges, other revenues come from ticket sales, boosters, and individual contributions. If you have ever watched a Big Ten Basketball or Football game on television, you would see the excitement of the students that attend these games. Painted faces and bare chests are common among the student crowd. The games bring all of these kids together in a safe and respectable environment to cheer for their school team.
Towns rally around their college athletics.
Look at Fargo, what would this town be without NDSU football. Grand Forks would be nothing if it didn't have Sioux hockey. That town breeds more talented hockey players than anywhere around. These teams bring a lot of attention to the colleges themselves and without the involvement of sports, they would probably not receive as much attention. Obviously, colleges would lose that revenue that is generated by their sports including the contracts with television and sporting good companies.