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Pete Thamel, ESPN
Nothing is easy in college sports.
And with the Power 5 conferences and the NCAA board of governors vote on Thursday for acceptance The settlement of three antitrust lawsuits creates a new structure for the sport, a moment filled with both historic change and looming ambiguity.
More than $2.7 billion in damages and a new revenue sharing model accompanying the House v. The NCAA and two related antitrust lawsuits mark a distinct turning point for college sports. Amateurism, long a fragile and fleeting concept in the multibillion-dollar college sports industry, is officially dead. College sports, a fractured group of longstanding kingdoms, has banded together in an effort to save itself, with the jarring sight of the five power leagues and the NCAA together in a press release.
This was a necessary and important week for the business of college sports, but not one of celebration for its leaders. It’s a promising day for future athletes, who are being compensated with a share of expected revenue of more than $20 million per school.
And it was also a confusing week for coaches and leaders on campus, who didn’t know what specific rules of engagement would be in place.
Don’t go to the orthopedist to pat yourself on the back for taking this step, because the business of college sports will still be a mess. No one should be happy to pay billions just to avoid paying billions more.
The peace that the NCAA and conference leaders hope they will achieve with billions of dollars in settlements appears to be tentative. While the settlement will make it more difficult for plaintiffs’ lawyers to use the threat of billions of dollars in damages in the future, athletes will have options to continue their challenge. any restrictions or limitations on how they are paid. As the final yes votes were being collected this week, a separate federal lawsuit in Colorado – Fontenot v. NCAA – continued to proceed in its own direction, leaving open the possibility that the NCAA’s lawyers would not have time to catch their breath before fighting the next battle over athlete compensation limits.
The games on the fields and arenas of college sports are still great, the TV ratings in college football and the NCAA tournaments for men’s and women’s basketball are both huge hits. And the NCAA, under the decisive leadership of president Charlie Baker, appears to have increased its relevance in the coming years by finding enough consensus to avoid a catastrophic financial loss from another court decision. judgment against it.
But the reality of the culmination of Thursday’s vote, which still requires Judge Claudia Wilken’s approval, is that university leaders came up with the worst option. Pay billions now and share the revenue or, lawyers predict, lose a series of lawsuits, declare bankruptcy and start over.
How we got here is very simple. As college sports exploded from regional passion to national obsession throughout the 1990s and this century, NCAA leaders and university presidents clung to a business model that did not pay salary for talent. (It’s no coincidence that the coaches are compensated at a significant rate because the players never ask for a salary.)
Just three years ago, the NCAA fought the idea of paying athletes outlandish $6,000 academic-based bonuses all the way to the Supreme Court. So it’s hard to overstate how drastically the tenor has changed around college sports.
Somewhere along the line, as the conference television networks were being formed, commissioner salaries skyrocketed to $5 million a year — for, of all people, former Pac-12 commissioner Larry Scott , – and television deals that rival professional sports’, there was never any way to get there. directly cuts into the athletes. Until this week.
So what does this mean for college sports when revenue sharing happens as early as fall 2025? Where does this take us?
We have outlined it nagging questions that will need to be remedied. Most decisions to this point have been guided by the NCAA, attorneys and commissioners, and there will come a time when the actual players in the athletic field – athletic directors and coaches – have a say said during this process. Or at least they hope so.
Along with making it less financially attractive for plaintiff attorneys to challenge the NCAA in antitrust cases, university leaders also hope they can put the settlement his new position at the feet of Congress as a demonstration of good will. In return, they hope to drum up some momentum for a federal law that would give them increased protection from future lawsuits. However, there is no guarantee that the settlement will cost any votes on Capitol Hill, which has so far been stagnant on NCAA-related legislation and will take up much of the election. elected in November.
Without help from Congress, it will remain a bumpy road for the NCAA to enforce the types of rules it believes are necessary to restore stability to college sports.
How does Title IX affect financial calculations? That looms as the biggest worry on campus. How will the list be constructed? Football coaches who have 130 players on their team — 85 scholarship players and 45 reserves — are wondering if they need to cut their roster by a third along with the cap on the projected roster. or not.
“This is all well intentioned, but I’ll believe it when I see it,” an industry source told ESPN. “There are three big issues at hand that will determine how this plays out: The Title IX strategy for implementing revenue distribution, enforcement issues around the remaining NIL, and how the list limit.”
If the NIL remains outside the athletic departments as expected, who will oversee it? The NCAA’s enforcement track record is almost as poor as its regulatory record. Should someone — perhaps a judge or a special master appointed by Judge Wilken — be the interpretive arbiter of the settlement?
“You will need a new team to handle NIL enforcement,” another industry source said. “Not the NCAA, because the system would be completely different. An entity that looks like an NFL or NBA league office, because the key issues are different from the previous regulatory focus at the NCAA. All are about amateurism. it’s going to be a lot different, the fact that you have a salary cap.”
The problem with controlling NIL is that separating transactions that rely on authentication from transactions that are thinly veiled for execution remains just as subjective a process as it has been throughout the past three years. last year. It’s unclear any settlement provisions would provide the tools schools need to shut down the burgeoning NIL market that is beyond their direct control.
Athletic directors are facing the most important decisions of their careers – how do they find the money and split it? The only certainty is that there will be dissatisfaction on campus, as the value of teams to their administrators will now include dollar signs.
And that will cause much consternation, including the possibility of cutting Olympic sports to help fund a list of financial bulls.
Get ready for a few months of uncertainty, as official federal approval looms and then the real work of finalizing the details will begin.
Those are the questions being asked today by everyone in the industry. Coaches don’t know how to recruit the Class of 2025, because the recruiting rules — specifically how many players can be on the roster — have yet to be determined.
The football players will take an official visit this month before their senior season and there’s no telling what to expect. Schools won’t even know basic details like position on the roster and amount of money available.
So while history will come with formalizing this settlement, its immediate future remains unclear. This is appropriate, since fixing problems that have been going on for decades is always a difficult task.
Because the truth is, nothing is easy in college sports.
