For decades, many sports observers have argued that college athletes, specifically those in football and basketball, should be paid, as they are the engines of the large businesses that comprise college sports enterprises. Everyone involved with college sports was getting paid, except these athletes.
Now that has changed. There has been a seismic shift in college sports, as one big-time college sports commissioner put it. Every athlete can get paid.
I was one of those arguing that college football and basketball players should be paid because they were the actual employees generating the big paydays. Thus, they should be paid based on the revenue generated by the teams, which means that athletes in non-revenue sports, all the rest, would not be paid. And the cost of providing those sports would have to come from somewhere else, e.g., student fees.
And that simple situation might have evolved into the disappearance of the so-called student-athlete when referring to football and basketball players. But the NCAA and the colleges did not take that approach. So we have an entirely different situation. And it is not better than the alternative.
In 2021, following the O’Bannon class action lawsuit victory and the adoption of NIL policies by state legislatures, the NCAA established an interim policy permitting NILs.
In the world of college football and basketball, NIL deals have primarily focused on funneling money to star players to build a roster. However, an athlete from a non-revenue sport became the face of NIL. This is LSU Gymnast Olivia Dunne, who is reportedly signed to an NIL deal estimated at $4 million per year.
A year ago, a New York Times article asked, “What wins college football championships? A potent defense? An explosive offense?” and answered, “In the era of NIL, it is money. Lots of it.” The authors of this article go on to say, “It can cost as much as $10.5 million for a title-contending starting offense and defense in the new Power Four conferences.”
What about individual players? Top Power 5 football players are earning $45,000 from their collectives, according to data from Student-Athlete NIL. And top Power 5 and Big East basketball players earn an average of $75,000. Of course, in the SEC, a quarterback can bring in over $1 million.
The scale of this money should not be surprising; however, some aspects of NIL’s operation are problematic. One is the “collectives.” “Collective” is the new name for boosters, which are organizations that fundraise from donors to provide money to a school’s athletes through NIL deals. They have no formal ties to the schools or the athletic departments; however, they recruit athletes by using these NIL funds. They are also permitted to interact with the athletic departments.
For example, in softball, a non-revenue sport, a collective for Texas A&M openly recruited a star softball pitcher from Stanford University, who had an estimated $1 million a year NIL deal that the collective paid. Notably, Texas A&M had never made the Softball World Series, but they made it this year and played for the championship. There were many such deals, usually smaller than $1 million a year; however, with the success of that singular effort this year, it will undoubtedly happen more often in the future.
These collectives compete to recruit athletes by offering NIL deals. That is
problematic. The NCAA has already punished several schools for recruiting violations, and others are under investigation.
House v. NCAA was a consolidated class-action lawsuit that included other cases and challenged the NCAA’s rules limiting compensation for athletes. The parties reached a major settlement this past June, bringing about the biggest change in the history of college sports, as this multibillion-dollar industry shreds the last vestiges of the amateur model that has been used for more than a century.
The terms of the settlement include approval for each school to share up to $20.5 million with athletes over the next year, and $2.7 billion will be paid over the next decade to thousands of former players who were previously barred from receiving that revenue.
Stay tuned. There are numerous loose ends to be addressed in the near future if college sports are to remain activities of college students.
