College athletics has always been a business, but now the game has changed.
Following Friday’s final approval from U.S. District Judge Claudia Wilken settling a trio of antitrust cases against the NCAA and power conferences—commonly referred to as the House settlement—college athletes are set to be paid, yes directly from their universities. The notion of amateurism isn’t quite dead, but it’s pretty much been put out to pasture.
What do you need to know about this historic settlement? Here are key answers to common questions about this turning point in college athletics.
How did we get here?
In 2020, Arizona State Sun Devils swimmer Grant House became the lead plaintiff in a lawsuit challenging the NCAA’s rules surrounding name, image and likeness. An injunction was issued that would allow for the sharing of broadcast revenue that was received by the various conferences. This antitrust case eventually wound its way through the court before a settlement was announced between the associated parties in ’24, which the judge approved of in June.
In addition to millions of dollars in damages related to backpay of NIL rights for athletes as far back as 2016, the $2.8 billion settlement also calls for revenue sharing directly with athletes for the first time. While the agreement covers the next 10 years, it remains clear to all involved that there is no putting this genie back in the bottle and this will be the norm moving forward.
What can schools pay athletes now?
Schools are permitted to share up to $20.5 million with athletes each year. How that money is divided up lies with the schools, but most are expected to follow a similar formula as the back-damages payout with 75% directed toward football, 15% to men’s basketball players, 5% going to women’s basketball players and 5% to the remaining players.
“We’ve talked a little bit about individual sports but we haven’t set exact percentages,” ACC commissioner Jim Phillips said. “I know for all five of us [power conferences], no one is forgetting about their Olympic sports and continuing to make sure that we invest at a high level for all our sports.”
Even within those tiers, the money is expected to vary widely, with the star quarterback naturally expected to make many more times than what the school hands out to the sixth man on the basketball team.
“It is a campus decision,” reiterated Big 12 commissioner Brett Yormark.
What else happens as a result of the settlement?
Perhaps the most tangible of aspects to the settlement is the arrival of roster limits. While in the past schools were capped in terms of the number of scholarships they handed out for a particular sport—the limit in FBS football being set at 85 for the past several decades—will soon be replaced by a hard ceiling in terms of the number of players they have on a team. This can result in some sports seeing both more players involved and the option of receiving full scholarships instead of partial ones. However, there may wind up being a reduction in certain spots. Only a handful of power-conference schools have announced plans to fully expand their rosters to include the maximum amount of scholarships handed out. Most major universities are planning to expand their athletic offers in some form or another starting as early as this fall.
What is NIL Go?
Business in the NIL world is set to change significantly as a result of the settlement, with the current Wild West being replaced by a structured workflow for deals, players and the schools—which can now also help players get additional NIL deals. The most notable new change is that for any deal signed by athletes with a value of over $600, the details must be sent to a new, third-party clearinghouse dubbed NIL Go. The entity is being run by consulting firm Deloitte and will attempt to regulate the market somewhat by determining whether deals are within a range of the nominal fair market value.
For example, a Heisman Trophy–winning quarterback at a team in Los Angeles is going to get a higher-end deal than a backup left guard in a Midwestern college town. If anything ranges beyond such limits, such as some of the current deals with school collectives that are paying out millions to some players, those will get flagged by the system. Players can then either alter their payouts or structure of the deal, or take things to arbitration in order to get cleared. If it isn’t cleared, they could be suspended from playing.
What don’t we know?
Surprisingly, a lot. At the annual gathering of athletics directors and administrators in Orlando just a few days after the settlement was approved, a constant refrain in the wake of the ruling was that the broader set of athletic departments impacted by the settlement had been planning for its go-ahead for years. While true, there’s a difference between game-planning and executing a new multimillion enterprise for the first time in a 25-day span from start to finish.
Among key questions still to be fleshed out and publicized, there’s the matter of the College Sports Commission (CSC), a newly formed LLC set up by the power conferences to essentially administer the settlement’s finer points. At a high level, that means ensuring schools are in compliance with the overall cap to spend on athlete payments and will also include an oversight function when it comes to third-party deals sent through the NIL Go system. It includes building up a new enforcement arm, set to be overseen by the newly hired CEO, Bryan Seeley, a former MLB executive who will be tasked with handing out punishments that are supposed to range from fines to suspensions. While there are varying degrees of skepticism, the settlement provides an avenue for a school to see its revenue-sharing number decreased, its head coaches suspended and its players suffer an eligibility hit should any stray beyond the guardrails that are currently set.
Yep. The NCAA has wiped away hundreds of antiquated rules as of July 1 and all but turned over enforcement in college sports to the CSC with a handful of exceptions (eligibility, academics, rare instances like a sign-stealing scandal, etc.). When it comes to the bulk of issues that college sports has had in the past when it comes to paying athletes, the policing of such matters has been fully turned over to this outside entity with final decision making resting with Seeley.
“His experience is really unique. To have league experience was a big part of this,” said Big Ten commissioner Tony Petitti, who worked with Seeley at Major League Baseball. “Part of what we do is manage a lot of constituents and, in Bryan’s role, you’re dealing with 30 clubs and very competitive areas that he’s involved in in making decisions. That’s very similar to what he’ll have to do in this role. Decisions that get made by this enforcement entity, ultimately, will have competitive outcomes.”
“I am very confident in Bryan, Deloitte, LBiSoftware and the new model that’s in place so that we have a bright future in collegiate athletics,” Yormark added. “I’ll also say that our schools want rules. And we’re providing rules. And we will be governed by those rules. And if we break those rules, you know, the ramifications will be punitive."
What does this mean on Saturdays this fall?
In short, nothing. There will still be noon kickoffs in the East every Saturday this fall and plenty of toes meeting leather late into the night each weekend. The biggest difference is likely to come in the bank accounts of those players who you see taking the field in football or the court in men’s and women’s basketball, most of whom will now be getting a paycheck with a university logo on it for the first time.
What’s next?
More lawsuits for one, with the settlement itself likely leading to a slew of incoming cases surrounding thorny issues such as Title IX and limits on compensation.
More pressing might be a push to get the settlement and some of the bigger changes in college athletics codified into law as part of an ongoing congressional push. Numerous leaders in college athletics have already made several trips to Washington, D.C., to discuss such issues with various elected officials, but tangible progress in such areas remains fleeting so far.
“They do have the ability to get things done, even in difficult political times,” SEC commissioner Greg Sankey said. “I think this is a nonpartisan issue, candidly. I don’t think this is about drawing lines between Democrats and Republicans, or the House and Senate. I think this is an opportunity for our governmental leaders, our political leaders, to come together around solutions.”
We’ll see if that winds up coming to fruition, but the bottom line is that college athletics has entered a new era and the ripple effects from the House settlement will reshape the future of the endeavor for many years to come.