A federal judge has approved a landmark $2.8 billion antitrust settlement that will revolutionize the way college sports is run. The agreement allows colleges to directly pay players through licensing deals, breaking the long-standing amateurism model.
The settlement was reached by Grant House, a former Arizona State swimmer who sued the NCAA and five major athletic conferences. His lawsuit combined with two others led to the creation of the new settlement, which paves the way for colleges to make payments to athletes using their name, image, and likeness (NIL).
Under the agreement, each school will share up to $20.5 million with its athletes in Year 1, representing 22% of their revenue from media rights, ticket sales, and sponsorships. The money will come from a combination of sources, including growing TV rights packages and increased costs for fans.
However, scholarships will remain an essential component of the college sports landscape. While athletes have argued that scholarships are insufficient compensation, the NCAA maintains that they provide valuable benefits, such as degree opportunities.
The settlement also allows third-party collectives to continue paying athletes’ NIL money directly from schools. This has raised concerns about whether $20.5 million will cover all athlete costs. Top quarterbacks can reportedly earn around $2 million per year, which would consume a significant portion of each school’s NIL budget.
To enforce compliance with the settlement, new enforcement mechanisms have been established by the defendant conferences. The College Sports Commission promises to be more efficient than the NCAA, analyzing third-party deals worth over $600 to ensure fair market value for athletes’ services.
The settlement also provides $2.7 billion in back pay to athletes who competed between 2016-24 and were partially or fully excluded from payments under previous NCAA rules. Football and men’s basketball players are expected to receive the majority of these funds, but ensuring equitable distribution is a complex calculation.
The settlement has significant implications for Olympic-sport athletes, whose scholarships will be increased to provide full funding. However, concerns remain about the potential impact on Team USA’s pipeline of college talent.
While the settlement may address some issues in college sports, it also raises new challenges and controversies. The enforcement mechanisms are vulnerable to litigation, and collective bargaining is an issue that has yet to be resolved.
Source: https://apnews.com/article/ncaa-house-settlement-aa3169056e8194aeebf34495641bce0b