Will paying college athletes cause more divides? What about Title IX? More lawsuits?

Answering questions about the NCAA allowing revenue sharing with athletes with Yahoo! Sports' Ross Dellenger.

The NCAA’s decision to pay athletes is one of the most impactful moments in the history of college sports. But making sense of the changes, what they’ll look like and how they’ll play out, is not easy. No one knows the landscape better than Ross Dellenger. He’s been covering the changes in college sports for Yahoo! Sports. He breaks down what’s known, what’s unknown and why keeping up with this situation is a little like juggling flaming knives. I’ll let him explain. All that and more on The Jenni Carlson Show.

Episode highlights

1:30: What’s it like trying to keep up with this story and all the issues?

3:00: What are the basics that every college sports fan needs to know about all of this?

5:15: Why did the NCAA agree to more than $2 billion in back payments to former athletes?

6:50: How are schools looking to annually fund the $21 million or so in payments to athletes?

9:35: How much is all of this going to cause separation between schools?

12:45: Is there a sense yet of salary caps or maximums on how much individual sports can pay to athletes?

16:25: Will NIL still be a part of college sports even with athletes getting paid?

20:30: What is college sports going to look like moving forward?

25:55: What is the biggest unanswered question right now about all of this?

Producer: Jacquelyn Musgrove

Creative Director: Michael Lane

Jenni Carlson: If people go onto Yahoo! Sports, they'll see it seems like you're writing something about this House vs. NCAA, the deal that was struck about a week ago, about three or four things a day. There's never-ending sources of stuff to write right now.

Ross Dellenger: You're right on that. There's a lot of questions, everything's so new. I think that there's endless angles to this thing. And I'm trying to answer everybody's questions and my own, and it's difficult to do. I told somebody it's been like putting together a really complicated puzzle while you're been drinking and while you're juggling flaming knives or something. … Somebody asked me the other day if I have a law degree and I'm like, ‘Are you crazy? No, I don't have a law degree.’ But I'm working on an honorary one, I guess.

Jenni: Exactly. Well, the fact that you're dealing with a lot of questions makes me feel better and should probably make fans out there feel better that they might have questions. Obviously, they can go to Yahoo! Sports, read up on your stuff, but let's start kind of basic. A week ago, the news comes out that the college sports world is changing. If there's a college fan out there who maybe is struggling to wrap their arms around this, what do they need to know? What are the basics about just what's going to change after the announcement of a week ago last Friday?

Ross: Well, the settlement, you know, is really like two parts. There's the back part that really fans aren't going to necessarily feel. I mean, I don't think. That's $2.77 billion to former athletes to recover NIL that hey would have gotten before NIL was implemented. 

And then there's a forward part, which certainly is an impact on a lot of the fans and their specific schools. I think that there's a lot underneath the new model going forward. There's certainly a ton of concepts below that. I imagine it kind of like a tree and below that, you got all these branches off of it and branches off of that, those branches and et cetera. 

I think obviously the main branch on this new model is a revenue share where schools can share revenue, if they want, can share revenue with athletes. And it's a percentage of an average of Power Five revenue streams. And that is not really known specifically yet, although I have some documents, but I think things could change. But the early documents I got were that the revenue average Power Five revenue streams that they're coming up with is about $98 (million) to $100 million per year. And so you take 22% of that. That's the number. So it's around $21 (million), $22 million is the cap. That's how they're getting that cap. 

So basically to boil it all down, schools can share $21 (million), $22 million a year with their athletes starting in probably July or August, 2025. That's the main kind of part of this, but then there's other branches like the scholarship and roster changes coming as well.

Jenni: I wanted to ask you one quick question about the settlement because I agree I don't think that's as impactful to the average fan necessarily. But the NCAA deciding to settle that and do the back payments — what's the why behind that? Were they just afraid of what could come out of those court cases? Or why do this deal for, like you said, $2.77 billion in back payments over 10 years to past athletes? What's the why behind that in your estimation?

Ross: Well, I think the NCAA’s past record in court probably offered the most significant reason to do this. And that is a lot of losses in court, specifically at the Supreme Court, where basically one of the Supreme Court justices, (Brett) Kavanaugh, said the NCAA is basically running an illegal organization because they don't share compensation specifically those athletes that produce money or generate money like football, men's basketball and some other things. So I think they saw the record and thought they probably shouldn't give this one a fight and should finally, for once and for all, at least that's what the thought is, that they could get some stability by settling and maybe prevent more litigation in the future. So that's probably the top reason.

Jenni: As far as the decision to do payouts to athletes, that 22% or whatever that number will end up being, $21-something million or $22-something million, that's a max. Schools will, I assume, have to go out and raise that money to pay that? I mean, how does that factor into revenue production at individual schools and that pot of money? Is that just on them to go out and raise that in addition to what they're already raising? What's your best guess and what are you hearing from schools on how they intend to try to have the money for those types of bills?

Ross: Well, a couple of things. I think No. 1, there are probably a handful of power schools, I’m going to guess that there's 12 to 15 that are probably generating a portion of that, a decent amount of that, whether that's $12 (million) or $15 million through their collective, their NIL collective. And the theory is you just move that over or keep it there, depends on kind of who you listen to about that situation. So they already have, I think, a portion of that from donors. 

I think if you're the Big Ten and SEC, you have new revenue streams on the way from the College Football Playoff expansion, from new TV deals. You'll have money coming in. The Big Ten and SEC probably by ’27, maybe by ’26, their distribution to each of their schools will probably increase by $15 (million), $20 million from now.  

Now, if you’re other leagues like the ACC and Big 12, you are looking for untapped revenues to generate. And the SEC and Big Ten are doing that as well. In fact, at SEC meetings, I had a story a couple of days ago about one of the big untapped revenues, which is corporate sponsorships on the football field, on fields, and potentially on jerseys with like jersey patches. And there'll be more about that because there's rules against that. And those are under discussion. 

So it's kind of two-fold. I think a lot of people have generated that money through booster and NIL booster collectives. And I think there's also a need and a movement right now to grow revenue in various different ways.

Jenni: Lots to unpack in that. The first thing that comes to mind is, you said like 12 to 15 schools might already be somewhere getting towards that $21 (million), $22 million. Then the SEC, Big Ten. Sounds like we're starting to talk about separation of the really halves and then the middle halves. Is that where we're headed, Ross? It seems like you've got some schools where the idea of generating $20 something extra million maybe not too high a bar, but that's not the case for everybody in college athletics for sure.

Ross: Yeah, you know, I feel like it's been moving in this direction for quite some time. Every change in college athletics the last several years has really benefited the rich and those with more resources. And so you're starting to see pretty serious gaps, whether that's from FCS and FBS gap there or the Group of Five and the Power Four gap. And then, yeah, there's definitely a new gap forming within the Power Four with the Big Ten and SEC. 

Greg Sankey (SEC commissioner) said at SEC meetings that he believes Division I can all stay together and be preserved in the March Madness. The basketball tournament can be preserved. That kind of binds everybody together. But you are going to see some pretty serious modifications to rule making and rule enforcement for the Power Four. Many of those rules and models and all that created probably by the Big Ten and SEC who formed a joint advisory board and will begin meeting or will continue meeting this summer about a lot of this stuff. 

You'll see a separate, whether it's a separate subdivision, I don't know, but there will be a separate entity where the Power Four will have their own committees and make their own rules. And obviously, they'll share revenue. And I think others can opt into that. It doesn't mean that the Power Four can't compete with others. They'll probably opt into that. There's probably, I don't know, five to seven to 10 Group of Five schools you could see paying at least some of this revenue and maybe they'll opt in or maybe they'll just pay the revenue and not opt into some of these rules and such. But I do think you are seeing a growing gap and the biggest question mark probably is, when has that gap become so big that there is no more competition between the Power Four the Group of Five. And I think we're getting closer probably to that in a reality.

Jenni: I know a lot of questions are left unanswered, so I may be opening a can of worms here with these next few questions, but have you gotten any sense of, I don't even know if this is the right term, but salary caps on sports or by team? Has any of that started to become clear? Because obviously, that $21 (million) to $22 million, a big chunk will likely be football, but how is that gonna look sport to sport? Is there a sense of just what that's gonna break down like?

Ross: How to distribute the revenue is certainly a big issue with a lot of different question marks underneath it. It's kind of like, again, I use that tree and that branch. It's a branch here, and there are a bunch of branches underneath it that will determine how you distribute the revenue. 

And the biggest one is Title IX, the federal law that requires equal opportunity and benefits for men and women athletes. And there's a question how Title IX is applied in a revenue-sharing model. There wasn't really much clarity on that at SEC meetings. I don't think there's a lot of clarity in general across the country on that, which is why, in the end, it probably will end in a courtroom with litigation and a lawsuit.

But for now, I think schools are trying to seek some clarity on that. So the question is, do you have to take that, say it is $20 million, and do you have to take $10 million of that and pay women athletes? While Title IX has certainly been an incredibly good thing for the United States, especially in the Olympic movement and women, athletes in general, administrators will tell you that giving $10 million in revenue share to women's athletes that probably their sports combined to lose …  $20 (million), $30 (million), $40 million, they'll say it's not good business sense. And they'll kind of say, ‘We’re a business now. And that doesn't make good business sense.’ 

And then that also leaves a gap in football and maybe in men's basketball, but certainly in football. There are football teams right now that probably are splitting upwards of $13 (million), $14 million to their roster. And you think about the cap, right? You think about maybe $9 (million) or $10 million if you include women's basketball, maybe $6 (million) or $7 million will only go to football. If you have to split it 50/50, that's a problem, right? Cause you're going to have another lawsuit from football players who will probably say, ‘We’re not getting enough of the revenue that we're generating.’ And that's where, either another lawsuit will come in from football players. 

It's kind of one of those tricky situations because if you split it evenly, you could get lawsuits from football players, No. 1, and No. 2, you could open up the door for the continued existence of collectives and third parties to subsidize football. But if you don't split it evenly, you're looking at for sure lawsuits over Title IX and potentially congressional issues over Title IX. 

So damned if you do, damned if you don't.

Jenni: I was going to ask you about NIL. Obviously has been all the rage these last few years with this structure. Could outside NIL money still be part of packages for athletes or does this cut out the possibility of, say, like a national advertising campaign that an athlete gets paid for? What's the sense of just how that factors in or is that dead as this comes in in fall of 2025?

Ross: Yeah, it does all depends on the athlete. Athletes can enter in, under the settlement, they can enter into third-party NIL deals. Those NIL deals will have to be disclosed and then run through a clearing house where this new clearinghouse that's probably going to be outside the NCAA. It'll probably be a third-party clearinghouse/enforcement arm to enforce this new model and make sure programs are not going over the cap, but also that athletes are signing real and true NIL deals. What they call true NIL deals based on fair market value. And I think this clearinghouse would determine that. 

So if it's true NIL, if it can be proven to be real NIL, athletes can enter those, are allowed to enter those agreements with outside third parties. There's certainly a question if this clearinghouse will have enough, if in this enforcement arm will have enough teeth to really enforce the rules, especially around boosters. If boosters are prohibited from entering deals with athletes, if a booster is a business owner and wants to enter an NIL deal, which is a lot of the case right now through collectives, what's happening through collectives? Can they do that? They'd have to prove that it's a real NIL deal, and they have to prove that the athlete is getting fair-market rate compared to others in the community and the region. So the answer to your question obviously is yes, but it does come with some questions.

I think another part of this is if schools choose to buy their athletes exclusive rights, which is a possibility. And that would mean that athletes can't do third-party NIL deals, but it also means that schools — and this is an incentive for schools to bring collectives in-house — it's an incentive in the way that schools can go out on their own or perhaps use an agency to get true NIL deals for athletes that don't count against the cap. And those-third party NIL deals wouldn't count against the cap. It's a way to actually expand the cap. 

So I use an example an AD told me. If you plan on paying a quarterback $150,000 a year, you pay them $100,000. That goes against the cap. That $100,000 is purchasing their NIL, and then you go out and sublicense their NIL through some corporation or business and get an extra $50,000, that goes to the athlete and doesn't count against the cap is how I've been told it will work. So really that athlete get $150,000, but $100,000 counts against the cap. So that was a long way of answering your question.

Jenni: Yeah, but this is obviously such a complicated issue. And it still feels like so much has yet to sort of be played out because there's so many layers of this whole thing. But I think one of the questions that a lot of people are asking, Ross, is what is college athletics gonna look like as all of this kicks in? I mean, you mentioned like corporate sponsorships, logos on jerseys, on the field, whatever the case might be. I've heard the words ‘venture capitalists’ thrown around. I'm sure you've heard similar types of things and probably even more as you've reported this so extensively. But I guess the question a lot of people are wondering is, is college sports going to resemble the college sports that they've come to know and love to this point? Or is it going to look so different that people may be turned off? Is there any way to know what college sports will look like once this all really kicks in?

Ross: Well, I think, no, not really. I think the theory or assumption would be that it's going to look a lot more like professional sports, where you're going to have potentially binding contracts between athlete and school, and you're going to have salaries like you do in the NFL, and you're going to have commercialization, I think, in many aspects of universities, like we talked about earlier with corporate sponsors and such. So, it is going to look different. 

I like to kind of describe it as college athletics is in the middle of a transformation and breaking out from being an amateur entity. And I should not say all of college athletics, right? Major-college athletics, really not even FBS, but Power Four. Major-college athletics is such a big business that it's breaking the mold of the amateurism and kind of exploding into this professional organization, which it's been for a while now. 

I know there are a lot of people, probably many of your listeners, who disagree with it, don't like the change. I'm a lifelong college football fan who I would describe as a traditionalist in a lot of ways and don't like necessarily a lot of the changes that are coming. But ‘we’ are to blame for all of it, and those within college athletics are to blame, the leaders who for so long put off not compensating football players, specifically, for the revenue that they generate, instead taking that revenue and either building the gaudy facilities or increasing coaching salaries or even pumping it back just into the department in general, which is a good thing, right? For Olympic sports and women's sports, it's a great thing. 

But a segment of that money probably always was intended or should have been intended for the athletes that do generate it. And it just got, there's just too much money. In the courts and state lawmakers, but specifically the courts, have said, ‘There's too much money involved. You have to split some of the money. And if you don't, we're basically going to continuously hammer you with losses that are going to cost you a lot of money.’ 

So you've college sports, I think, going back to your original question of why settle this, I think leaders have finally realized, ‘All right, we have to change and do this.’ And that's part of the setup.

Jenni: The popularity caused everything to change. There were so many millions in there, something had to be done different.

Ross: TV money, ticket sales, sponsorships, those three. And donations too, of course, right? But donations aren't a part of the formula to get to the cap, but those other things are ticket sales, the TV rights, and the sponsorships. And the average, I said it earlier, I think it's around $100 million (per school). Those things generate about $100 million. That's the average across power conferences. I realize that athletes get the tuition and room and board and all that stuff. They get a lot of that. If you total it up, they get about 20% of that $100 million right now. But that obviously isn't enough for many. 

And that's why you have that extra 22% to get the amount closer to what would be a normal collective bargaining amount, which is around 50%.

Jenni: Before we let you out of here, Ross, one last question. What is your biggest unanswered question at this point? Maybe you've already alluded to it, maybe not, but what are you most curious to see ironed out at this point in all things related to what we've got going on?

Ross: It's definitely Title IX. That would just determine so much how a school distributes the money. And that's kind of the most important part here is how Title IX applies and if the revenue needs to be split 50/50 or not. I think that will also determine the future probably of collectives. 

The way we're going to get a determination on Title IX probably is through the court system eventually. But right now, I think most college leaders are kind of under the impression that they will have to operate and apply it, satisfy Title IX, and that means it's getting as close to the 50/50 as you can, which probably means one of the intentions of this settlement, which would be the elimination of collectives, is probably not gonna happen.

You can find Ross on Twitter at @RossDellenger and Yahoo! Sports at sports.yahoo.com.