RICHMOND, Va. -- When the NCAA and the Power 5 athletic conferences settled lawsuits leveled against them by a group of former athletes, the shockwaves rippled throughout the entirety of the college athletic landscape.
And it won’t be calm anytime soon.
The NCAA and member schools agreed to pay $2.7 billion to former athletesfor compensation for their Names, Images, and Likenesses (NIL) dating back to 2016.
The sum is considered a bargain compared to what the plaintiffs in the case could have received had the cases gone to trial. Given the NCAA’s legal track record in this area, the settlement was almost universally considered a good move and a better deal.
The money will be mostly paid by the NCAA and the Power 5 programs (SEC, ACC, Big 10, Big 12, and Pac-12). Smaller conference schools like Richmond and VCU, both members of the Atlantic 10, will end up paying a percentage of that settlement over the next decade, reportedly in the neighborhood of $2 million per school.
But what comes next is how this will affect college sports moving forward. Until now, student-athletes had been able to negotiate their own NIL deals with sponsors.
The schools will now have the ability to handle all of those transactions. The Power 5 schools have all agreed to, initially, funnel about $20 million per school each year to their athletes, covering most, if not all NIL considerations.
How they will distribute that, and how much smaller programs will be required to distribute, is all under consideration and is the subject of a myriad of questions for administrators, athletes and fans.
“Until we get all that information, we can’t make any financial decisions,” said VCU Athletic Director Ed McLaughlin. “Any decision like this is going to have significant financial impact.”
VCU has 17 different sport programs between both men’s and women’s, and has made the NCAA Men’s Basketball Tournament 10 times in the past 13 years and has built a national reputation.
How best to maintain that reputation while considering the other 16 sports under the Rams banner is what McLaughlin and his staff will have to figure out.
“We are working on a lot of different financial models,” McLaughin admitted. “Our fundamental model of amateurism has gone away, and what we do in terms of (NIL) is a huge, huge change. I would be lying and remiss if I thought I could say I know what the business is going to look like in five years.”
These changes and financial movements do not go into effect until the fall of 2025, which is only 15 months away. While the product on the field or court may not change much for the average fan, what goes on behind the scenes to give teams and athletes the best possible collegiate experience will never be the same.
“I’ve been waiting for things to stabilize in this business for 25 years,” McLaughlin said. “We are going to have to continue to make investments to get really talented student athletes. But VCU isn’t going to say ‘Well, this is too hard, we’re gonna pull up the tents’. That ain’t gonna happen anytime soon. We’re going to continue to make sure we compete at the highest level to try and win national championships.”
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