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Dan Hope and Andy Anders of Eleven Warriors bring you inside the Ohio State beat every Wednesday with a podcast covering everything you need to know about the Buckeyes.
Note: This transcript was AI-generated and may not be entirely accurate.
(0:07) Welcome into Real Pod Wednesdays, Dan Hope back this week after a week off, joined by (0:13) Andy Anders, as we are coming off of a very newsy week in college sports, both for the (0:23) present and the future of college sports, as the NCAA agreed to a settlement this past (0:29) week, in which it will pay nearly $2.8 billion to division one athletes who have competed (0:36) since 2016 to compensate them for, you know, their name, image, and likeness for the revenue (0:42) that they missed out on over the past decade.
(0:45) But more consequentially is that this settlement is also going to create a new model for college sports in which colleges are going to share revenue with their athletes for the first time beginning in 2025, 26, uh, colleges under this new model are going to share approximately 22% of their revenues with their athletes. (1:13) And this will be the first time ever that the NCAA is authorizing schools to pay their athletes. (1:22) The NCAA for so long has stood by amateurism being its core tenant that its athletes are not paid to play sports.
(1:32) But we've seen that change indirectly over the past few years with NIL, with the rise of collectives that have effectively turned into ways for schools to funny funnel money to players for pay for play. (1:45) And now the NCAA is going to rip off that veil of amateurism and directly authorize schools to pay players for the first time. (1:57) I think we all felt that this was coming sooner than later.
(2:00) I don't know if we necessarily expected that it was going to happen this quickly, but I think it was inevitable with the way things had gone with NIL that revenue sharing was the next step for college sports. (2:16) And now the NCAA and the power conferences that have decision-making authority have all agreed that it is time to take that step. (2:25) Yeah.
(2:25) The writing's been on the wall here for a while with this, Dan, like you said, and I think it's the logical progression of where college athletics has come these days. (2:35) You know, it's a business now more than ever, and athletes are seeing a cut of that business. (2:41) This is why conferences are now marketing more, getting these bigger exorbitant TV deals, doing whatever they can to generate revenues, because this has been on the horizon for some time.
(2:56) The numbers around this are kind of staggering when you talk about that nearly $2.8 billion, but only $1.2 million of that is going to come straight from the NCAA's coffers here. (3:09) Further reports, $950 million will be coming from future distributions to FBS conferences over the next 10 years. (3:17) Well, that's money the NCAA was going to be paying out, sharing with FBS conferences, $950 million from that, $370 million from FCS football conferences, and then $340 million from non-football conferences.
(3:31) So the schools are actually in some way helping pay for this. (3:36) The conferences are helping pay for this sum when you talk about NCAA distributions and things, which I find quite interesting in how this whole payout structure works. (3:46) I suppose it makes sense because in the end it was those schools who would have been sharing the revenue in the past, but it's just something I found interesting in this whole exchange of how these antitrust settlements are being paid out.
(4:02) But I think that talking about the inevitability of this, and it wasn't the NCAA being proactive, and that's something we've seen over the years here, and something Gene Smith has talked about. (4:17) These antitrust lawsuits sort of forced their hand in this, and I think it's good because change is inevitable, and the sooner you embrace it, the better. (4:26) I think the sooner you get boots on the ground and hit it running with this revenue sharing plan, the sooner you get that going, the sooner you can acclimate to it, the sooner you can get a system in place, because there are going to be kinks to work out in the first few years of this, figuring out all the distributions you give to athletes.
(4:46) And we'll get into some of those questions later, but I think it was the logical progression of where things have been heading the past few years. (4:56) Yeah. (4:56) If you want the NCAA to get something done, sue it.
(4:59) That's usually the way it works. (5:01) But the NCAA, whether it was the Transfer Portal, whether it was NIL, whatever it may be, typically the NCAA acts when it is afraid of losing a lawsuit, and that's exactly the case here. (5:13) Because basically, if the NCAA didn't settle this lawsuit, they were at risk of potentially having to pay three times as much to the plaintiffs in that lawsuit.
(5:22) It was possible they could have had to pay as much as $9 billion to former athletes. (5:29) So basically, this settlement was a way of ensuring that the NCAA would avoid the worst case scenario if it lost the lawsuit, and certainly tells you that the NCAA was not particularly confident in its chances of winning those free antitrust lawsuits. (5:45) But it's a big change for the NCAA.
(5:48) It was less than 15 years ago that Ohio State had to vacate an entire season of wins, was banned from playing in the postseason after a 12-0 season because five players got free tattoos. (6:00) Now, that would be nothing. (6:03) But back then, that was a huge scandal that Ohio State players were getting free tattoos.
(6:08) And so we've really seen, in a very short amount of time, a just total change in college sports. (6:18) And we were going down this track. (6:20) I mean, in some ways, this is a huge step for college sports.
(6:25) It's an acknowledgment that amateurism no longer works, and that athletes deserve a piece of a pie, which the NCAA has been resistant to give athletes forever. (6:35) On the other hand, it's a natural evolution of what's already happened over the last few years. (6:41) And again, we talk about the NCAA not being proactive.
(6:44) The NCAA certainly was not proactive with NIL. (6:47) And that's why we're in the situation we're in now. (6:50) Gene Smith will certainly talk about that, that Gene Smith was part of a working group that attempted to create guardrails for NIL and to come up with a system that would work for everybody.
(7:05) The NCAA decided not to adopt what his working group came up with, and then basically went into NIL with no rules at all. (7:13) Basically, they said, well, we'll just go with whatever state laws tell us. (7:16) And that devolved into where we are now, where NIL collectives are basically just doing whatever they want.
(7:23) The NCAA, again, because of another lawsuit, has basically lost all ability to enforce its rules against NIL collectives. (7:33) And so you just have NIL collectives paying players whatever they want, and there's really no way to stop it. (7:41) And so I think the ideal way of this working out for college sports is that this allows the NCAA or whoever ends up overseeing this whole thing, because it may not ultimately be the NCAA, that they are able to create some regulations around this, that they're able to level out the playing field a little bit, because there is going to be a cap on this.
(8:06) And I think this might get misconstrued sometimes, is this is not a requirement for schools to pay the athletes a certain amount of revenue. (8:17) It's a permission to pay the school, to pay the athletes a certain amount of revenue up to that cap, which is going to be 22% of the average revenues for power five schools or power four, whenever it becomes that. (8:33) But certainly the expectation is that schools like Ohio State are going to spend as much of that revenue as they can on their athletes, because this is going to become the new way to compete for players, is players are going to want to get whatever share of that revenue they can.
(8:48) And so schools are going to give that amount of revenue to their athletes in order to compete with one another to get the best players, much like we see with the NIL collective market right now. (9:02) Now, will this put an end to the NIL collective arms race? (9:07) That we don't really know right now.
(9:09) There seems to be some early optimism from college sports administrators that there will be a stronger enforcement arm associated with this new model that will allow it to be more regulated. (9:24) But you'd be naive to think that schools aren't going to be continuing to look for loopholes, look for ways that they could get an advantage over one another. (9:33) And so we'll see if, you know, the wild, wild west continues or if this kind of rains some things in.
(9:42) But I think the good thing about this is in terms of athletes getting paid is this is really the money that athletes should be making. (9:54) They should be getting a share of the TV revenue and the ticket revenue and sponsorship money that their salaries, so to speak, shouldn't be coming from fans donating to a collective. (10:09) And granted, the money is still indirectly coming from fans because it's the fans who are buying tickets to watch games.
(10:16) It's the fans who are watching games on TV who are leading to these big contracts. (10:21) If the fans stop going to games, if they stop caring about the programs, if they stop watching games on TV, then there won't be any money for the athletes. (10:30) So the money does all come from the fans at the end of the day.
(10:33) But I know it always, it never sat right with me, the idea of you're asking fans to attend games. (10:40) You're asking fans to watch games on TV. (10:43) You're asking fans to give back to the university.
(10:46) And oh yeah, now you're also asking them to donate to these collectives to help pay for players and recruits. (10:53) And so I think this will streamline the process a lot. (10:58) I know at least at Ohio State, there have already been talks about consolidating the collectives within the athletic department.
(11:07) And I think this will lead to a more streamlined approach for everybody to where if you're Ohio State now, you can just direct people to donate to the athletic department again, rather than you got to donate to this collective or this collective because we can't pay them ourselves. (11:23) Now, I think this will kind of consolidate all that and make everything simpler for everybody in that regard. (11:31) And you know, also should note too that this does not replace real NIL.
(11:37) Like real NIL is always going to continue to be a thing. (11:40) Endorsement deals are going to always continue to be a thing. (11:43) And that's going to be a good thing for Ohio State because Ohio State is in one of the biggest cities that a major college team plays in.
(11:51) They're the biggest brand in the city of Columbus, and they have a massive, passionate fan base. (11:56) And so there's always going to be those real NIL opportunities available for those athletes. (12:02) And that's a great thing.
(12:05) But I think nobody can deny at this point that pay for play has become a thing in college sports. (12:10) And so if that's going to be a part of college sports, the money should be coming from the share of the revenue that the universities are making and not from fans basically donating their salaries. (12:24) I think you hit the nail on the head with that.
(12:26) It goes back for me to how NIL started and how, you know, when basically legislators forced the NCAA's hand, again, we talk about them not being proactive, NIL hit them on the head. (12:38) You get that again, that committee with Gene that wanted to put guardrails on the thing that wanted to set up a better system for it. (12:46) The NCAA kind of washed their hands of the whole thing.
(12:48) And I'm not often one to point fingers in these situations, or at least I try not to be. (12:53) But they kind of washed their hands of the whole thing. (12:56) And that's what's led to this wild, wild west.
(12:58) That's what led to this sort of need to establish a model where you can kind of control how the players are being paid and not just having bidding wards where fans are donating and you're essentially creating a third party pay for play system. (13:16) Like it's you're giving the players X dollars to attend your school, essentially a salary, but it's happening through a third party collective who is facilitating this. (13:28) And that's not what the intent of NIL was and is.
(13:32) You should be able to go out, market yourself, get endorsements, autographs. (13:36) I was in favor of that going back a long ways. (13:40) And I think again, revenue sharing, fantastic way to get players what they're worth.
(13:48) You know, you should earn a cut of the income you generate for any institution. (13:53) I think that's fair, right? (13:55) You know, in the working world, you earn a salary based on your company's revenue and your contributions to the company.
(14:03) This is a business now. (14:05) It's been a business for decades, really. (14:07) And for the NCAA to finally be catching up and realizing that we're being forced to catch up and realize that that's how this progression has happened.
(14:16) It's a natural progression of that. (14:18) And the benefit of bringing it all in house is now the athletic departments can manage it and be responsible for it. (14:28) And being able to oversee again how the players are getting paid allows less opportunity for bad actors and for these dollars that are entering and not being the intended purpose of them to come into play.
(14:45) With NIL, which will again still be a thing after revenue sharing, and there will be opportunities, you know, for people that just want to, under the guise of an endorsement, pay a player to go to their school. (14:58) That'll still happen, I'm sure. (15:00) But it's going to be much less prevalent when there's a structured approach to all of this.
(15:08) And that's the real benefit of this direction that's being taken. (15:12) Complications could be, you know, different laws in different states. (15:15) I think maybe some federal regulation of certain aspects of this would be helpful too.
(15:22) That's something that Gene Smith has discussed in the past. (15:25) But regardless, we're on the right track. (15:28) And that's something that really, since NIL became a thing, it's kind of felt like help wasn't on the way in terms of putting some guardrails in place, in terms of making it less of a wild, wild west.
(15:44) It just seemed to get crazier year over year. (15:46) Finally, this is something that starting next year, 2025, we'll get to temper things a little bit and start to wrangle some of the control back within the athletic departments. (15:58) Yeah.
(15:58) I mean, you think of like the NFL, for example, you know, the players, they get a cut of their revenues and their salaries and they can sign endorsement deals outside of their salaries. (16:08) And that's, you know, kind of what college sport is becoming now. (16:12) You know, what you don't have in the NFL is you don't have fans banding together to pay a player's salary.
(16:18) They're buying tickets to the games. (16:21) They're, you know, they might be buying the NFL Sunday ticket package or whatever cable package or whatever five streaming services you need now to watch the NFL. (16:29) And we've obviously seen that bleed into college football a little bit as well.
(16:34) They're buying, you know, team memorabilia, whatnot. (16:36) But they're not actually paying the salaries of the players. (16:41) And so I think, you know, that is important to get away from that and college sports and college sports, they are becoming more like professional sports now.
(16:49) And that's not something that, you know, a lot of college sports loyalists love necessarily. (16:55) But to your point, Andy, it's been a business. (16:58) It's been a business for a long time.
(17:00) It is a business. (17:01) That's just reality. (17:02) College football, as we know, it would not exist if it wasn't making money.
(17:09) It is a business. (17:10) And so the players should be entitled to some of those profits. (17:17) They should be.
(17:17) And so that's just the reality of where we are. (17:21) It's certainly a new world for college sports, but it's one that, you know, people just have to accept at this point because this is where we're, this is where we are. (17:31) We're not going back.
(17:32) We're not going back to a world of amateurism. (17:35) Now that train has left the station and this is now the new world of college sports. (17:40) And there are a lot of unanswered questions that we will get into here on the show about what the future could look like, because this new model could prove to be just a temporary fix.
(17:53) It might not be a permanent solution. (17:55) And there's some major questions, particularly in terms of Title IX. (17:59) We talk a lot about football on this show, but how this will affect other sports.
(18:04) There's a lot of questions that are going to need to be answered here. (18:07) Certainly a lot of conversations that are going to take place among college athletics leaders over the next year to prepare for this going into effect a year from now. (18:18) Like you said, there's continues to be calls from college athletics leaders.
(18:22) I know, you know, SEC Commissioner Greg Sankey just on Monday was saying that, you know, he'd still really like for Congress to, you know, intervene and help the NCAA with this new model. (18:33) But, you know, again, we'll see if that happens. (18:35) I mean, it's a presidential election year.
(18:37) There's a lot of other things for Congress to deal with right now. (18:40) So I don't think that the first item on Congress's agenda is elating how college athletes are paid, but certainly a lot of communication that needs to take place among college athletics leaders to figure out exactly how this system is going to work next year, because those details have not been all ironed out yet. (19:02) But certainly I think for our listeners, the most important thing people probably care about is how is this going to impact Ohio State?
(19:10) I think the big advantage Ohio State has is the fact that it already generates the most revenue of any athletic department in the country. (19:18) You know, as of the last time USA Today did its roundup of all the revenues for all the college's athletic departments in the country, which was for the 2022 fiscal year, Ohio State had the highest revenue of any college athletic department in the country. (19:34) And it then increased that revenue in the 2020 free fiscal year by $25 million.
(19:40) And that was before the Big Ten's new TV deal even went into effect. (19:44) And so you figure Ohio State was at about $279 million in revenue for 2023. (19:50) That figure should probably go up to over $300 million with this new Big Ten TV deal coming in.
(19:56) And so Ohio State has a lot of revenue to work with. (19:59) That projected figure to start things off has been projected at around $20 to $22 million a year that schools are going to be able to share with their athletes. (20:11) That's the 22% average among Power 5 schools, but that would be less than 8% of Ohio State's total revenues.
(20:20) Ohio State is going to have plenty of money to work with to fund all of their other expenses. (20:26) And I think that's where Ohio State can have an advantage here in the sense that they're not going to be able to share more than other schools, at least not the schools that can afford to pay the maximum amount of revenue to their athletes. (20:40) But they're going to have more money left over to continue to pay for the best coaches, to upgrade their facilities for all the other resources they want to provide to athletes.
(20:52) It's not an insignificant amount of revenue for Ohio State. (20:58) It's been a basically cut into what their surplus was last year. (21:02) And so they're going to have to continue looking for ways to generate more revenue in order to comfortably afford paying this amount of revenue to its athletes, on top of the possibility of having to pay out more scholarships.
(21:15) Because this new model is also expected to eliminate the limit on scholarships to where all athletes across all sports could be on scholarship. (21:25) The piece of the pie for Ohio State is smaller than it will be for most other schools. (21:33) And that's certainly an advantage for Ohio State.
(21:37) Now, in terms of just using revenue sharing to build a roster, that advantage could be mitigated somewhat by the cap, because if it was just open season, Ohio State would be able to outspend just about any other school in terms of acquiring players through revenue sharing. (21:56) With that cap, they're going to be limited to a finite amount of revenue they can share. (22:02) And so that could help the schools that maybe don't make quite as much money as Ohio State, but they still make enough to where they can share that full, whatever that 22% figure ends up being.
(22:15) Those schools could be kind of on a level playing field with Ohio State in terms of how much revenue they can share with players, whether it be retaining players or recruiting players, whether it be out of high school or of a transfer portal. (22:30) So in some ways, Ohio State would maybe be better off without a cap or with a cap that was proportional to its own revenue. (22:39) At the same time, though, if there was no cap, then you would anticipate a spending getting out of control and probably having a lot of consequences on other spending, since schools would really be stretching their budget to pay players as much as possible.
(22:56) You think about the smaller schools of the world that this is going to eat, maybe 30 plus percent of their athletics department budget every year. (23:08) If they use the max amount, that's going to be a much bigger impact on them in terms of what they can fund otherwise than it is for Ohio State. (23:17) And I think if you were Ohio State, you'd like there to be no cap for that reason, to go out and spend as much money as you want on certain players, certain key targets.
(23:29) Now, I think one area this is interesting for Ohio State, again, it's a big question as to how you distribute revenue to players, is basketball. (23:39) And will you be able to invest enough revenue in basketball to compete the way you want to (23:46) and give those basketball players a large enough share to attract them to your school (23:51) against some of the universities that are going to be more all in on the basketball team, (23:57) as opposed to the football team, your Kentuckys, your Kansases, your Dukes, (24:01) your North Carolinas, those teams where basketball comes first.
(24:06) Ohio State wants to compete at the top level of basketball moving forward. (24:11) That might require a bigger expenditure than you're willing to pay for them. (24:17) Where do you make up the gap will be a big curiosity for me.
(24:21) Is it going to be a bigger NIL facilitation on the basketball side, whereas you make up a bigger chunk of a player's earnings through revenue sharing on the football side? (24:33) Also, how much control over the distributions you have is going to be key in that and determining which athletes get what. (24:42) This is really the limit for the basketball program that wants to compete at the top of the Big Ten, but it will really test exactly how much emphasis Ohio State is willing to put onto those basketball players in acquiring talent in that realm.
(25:03) On the football side of things, again, this might create a situation where it's harder to secure your second tier targets, your transfer portal gets that aren't as key in the football side of things, building depth on the roster. (25:20) Some of those areas where a smaller school might be willing to pay a bigger premium, a bigger share to get someone who would just be more of that depth piece or fill a smaller role at Ohio State. (25:35) But on the flip side of that, again, NIL is still going to be a thing.
(25:39) So how much of it are you going to be able to make up for in NIL against other programs at the top? (25:46) Is Ohio State's NIL collective going to be as thriving as we've seen this spring? (25:52) How huge it was to bring in players like Caleb Downs and those types of people, those types of assets, types of talents that was facilitated through NIL, obviously in large part.
(26:05) If the profit sharing is equal, distributions are equal, how can you then create the advantage in the NIL space, especially if it's being brought in-house and managed by the athletic departments now? (26:19) So those are questions that I think are particularly pertinent to Ohio State talking about how does this affect basketball and then how does NIL work to still make up some of the gaps, both in football and basketball, that might linger from revenue sharing. (26:38) Welcome to Ohio State, Ross Bjork.
(26:40) You're coming in at a very interesting time. (26:44) This is not going to be an easy time to be an athletic director because this is now going to become one of your biggest priorities as athletic directors, determining the strategy for how you distribute this money among your programs, along with managing everything else in the budget. (27:03) I mean, this is going to be one of your biggest questions now and it's going to be really fascinating to see the different strategies schools might take in terms of how they distribute this revenue among their sports.
(27:17) And going back to the point before about stretching schools' budgets, some schools are just not going to be able to afford to pay the full amount to their athletes. (27:25) I mean, particularly when you talk about non-Power 5 schools, like those schools are not going to have $22 million sitting around to pay their athletes. (27:33) Most of those schools already lose money on athletics.
(27:37) And so some schools are just not going to be able to pay out this kind of money, especially when you factor in the amount they are required to pay based on the distributions to the former athletes, then to add on further payments to new athletes. (27:54) I mean, for some schools, the amount they're going to be able to pay their athletes is going to be much smaller than that maximum amount. (28:01) So that's going to help Ohio State in that regard.
(28:03) But, you know, to your point on basketball, I do think, you know, if this model and granted this model can change, you know, we'll see exactly what it looks like. (28:12) Do they put some protections in place that limits how much a school can distribute to one sport? (28:18) Because if schools are able to just divvy up their revenue to the sports of their choosing, I mean, there's no doubt Ohio State is going to devote the most of its revenue to football.
(28:29) That's true. (28:29) I mean, football is by far its biggest moneymaker, and it is by far the program that people care most about at Ohio State. (28:38) Football is king at Ohio State.
(28:40) And the number one goal for Ohio State's athletic department every year is to compete for a national championship in football. (28:46) Money is not going to be taken away from a football program for a basketball program. (28:52) It's just not.
(28:53) At Kentucky, it probably will be. (28:55) At North Carolina, it probably will be. (28:57) At Indiana, it probably will be.
(28:58) And so I do think that if the model goes that way, I think it's going to be harder for a school to be elite in both football and men's basketball, because those are going to be the two schools that are going to require the most revenue to go out and acquire players. (29:17) And so I do think it's going to become harder for the football schools to compete with the basketball schools and vice versa. (29:25) I think that is going to be a challenge that Jake Diebler and Ohio State have to navigate on the basketball side.
(29:31) It's not to say that they can't be a championship contender in basketball. (29:36) It's just one more hurdle that they're going to have to overcome, because I can imagine that a school like a North Carolina or a Kentucky or a Kansas, they could spend the majority of their budget on basketball. (29:48) And that could give them millions of more dollars to go out and get the best players in the country, which might make it tougher for Ohio State to go get that five-star recruit or go get that top transfer.
(30:00) And granted, those schools have already had an advantage over Ohio State, so that's not anything necessarily new. (30:05) But I think that gap could widen there to where Ohio State is going to really have to get creative. (30:12) Like you said, they're really going to have to be able to set up NIL programs for their basketball players and be able to pitch them on that if they're going to be able to beat out those basketball-first schools for top players going forward.
(30:28) Right. (30:28) And then as it relates to smaller sports, I think Ohio State should strive to keep all 36 sports in place, because I think it's a wonderful opportunity for all those athletes, even if you're not competing at a championship level in all of them. (30:43) I know that's been the goal in the past.
(30:45) I think for me personally, it's worth keeping a sport around, even if you're not trying to compete at that level, because there's a lot of benefits outside of winning the championship that athletics provides to students. (30:57) It's been linked to higher grades in school. (31:01) It's been linked to lower instances of drug use and those sorts of things.
(31:07) There's a lot of positive benefits and competing at the top level that being involved in a sport while you're getting an education provides. (31:18) But as far as it goes, I think Gene had some great comments about it being tougher to facilitate all 36 sports at that level back when we talked to him in April.
(31:28) The way I look at it now, I think it's going to have to be the expectations for the other sports. (31:37) We talked about today the fact that in the past, we've always had expectations for all of them to chase championships. (31:44) Realistically, if you're not providing all those resources that we currently provide, because you have to reduce their budgets in order to fund whatever comes at the top level, then you're just going to change your expectations.
(32:01) My guess is we'll still sponsor 36 sports, but X number will be sponsored at a different level of support, if that makes sense.
(32:12) Yeah, this is a tough, tough question for me. (32:15) I think I could spend a lot of time debating both sides of this argument, because I do agree a few that I would like to see all 36 sports stay in place. (32:27) I think there are certainly benefits to keeping all 36 of those sports.
(32:32) I think every single one of those sports has passionate alumni and people who care about those programs who would certainly be upset if any of those programs went away. (32:44) But to me, to hear, well, if we keep all the sports, we're not going to be able to compete for championships in all of them. (32:50) To me, that's where I start to wonder if it really is in the best interest of Ohio State to keep all 36 sports at that varsity level, because the goal is to compete at the highest level, right?
(33:02) Is it better for Ohio State? (33:05) I don't know what that X number is, but if you fund 36 sports and half of them are going to be funded at a lower level to where they can't realistically compete for championships anymore, is that better than keeping 24 sports and being able to fund all of them at the level you currently do? (33:24) I mean, those are tough conversations to have.
(33:26) I mean, cutting any sport is going to come with some backlash from a certain amount of people who have a connection to that program. (33:37) So I do believe that cutting sports remains a last resort for Ohio State. (33:42) And there are ways for them to make it work.
(33:46) I think one way they can do that is by having people who care about each of those individual programs donate specifically for those programs to raise funds for those programs. (34:00) And I imagine that each of those programs and Ohio State at the administrative level are going to increase their efforts to raise funds to support each of those programs individually so that the money for those programs is not coming from the football surplus. (34:21) Because that's the challenge here is now that you've got this revenue sharing model, it can no longer be football's responsibility to subsidize 34 other sports.
(34:35) And that's probably a righteous thing, especially when you talk about the players getting their revenue. (34:41) It's not the football players' responsibility to ensure that the baseball team and the synchronized swimming team and the soccer teams can go on. (34:49) Like, it's not.
(34:50) It's not. (34:51) So there needs to be other revenue streams for those sports. (34:55) You know, the challenging thing is 34 sports lose more money than they make for Ohio State.
(35:02) And so that's just why I questioned the long-term sustainability of all of those sports. (35:09) I hope Ohio State finds a way to make it work. (35:13) But I think that's going to be something that's going to kind of continue to be that (35:17) elephant in the room here for a little bit, especially as this model first starts out (35:23) and we see what finances look like over the next few years and whether Ohio State can (35:28) continue to fund itself as an athletic department with the amount of expenses it has when you're (35:35) adding in more expenses now in the form of revenue sharing, in the form of more scholarships. (35:42) And again, Title IX is going to be a factor in this as well. (35:46) You have to provide equivalent opportunities for female athletes to male athletes, at least in terms of scholarships and the number of sports you fund.
(35:55) Any, you know, women's sports that would be cut would have to come with an equivalent cut on the men's side. (36:03) And I think, you know, if sports were to be cut, you'd probably see some men's programs that are not revenue generating be some of the first to go just because of those Title IX requirements. (36:15) Now, you know, again, the question mark here that we don't quite know the answer to yet is whether Title IX is going to apply to this revenue sharing.
(36:24) And that's another complex conversation because I think the schools are not explicitly required to pay female athletes a certain amount of this money. (36:36) Most of the money is going to go to football and men's basketball, which I think you can make a very real argument that it should go to those athletes because they're the ones who are bringing in the money. (36:48) Football teams are bringing in the most money.
(36:50) So the football players should get the highest amount of revenue. (36:54) The men's basketball team is making the second most money. (36:58) So men's basketball should get the second most amount of revenue.
(37:01) And that's why I do wonder if long term, if the system should be made in a way where the revenue is more proportional to each sport, to where the amount of revenue that's generated by each sport, that percentage of the revenue should be allocated to athletes in those sports. (37:20) I don't believe that's going to be the case to start things out, but that's something that I do wonder long term, if it should be more, you know, allocated, you know, sports specific revenue so that, you know, the athletes who are helping generate each portion of that revenue are getting their cut of that revenue. (37:40) We don't know exactly what that's going to look like.
(37:42) I think because of that, like that would be the argument against like saying that because of Title IX, half the money should go to female athletes. (37:50) Because if you're just looking at it from a strictly business perspective, the women's sports are not generating half of the revenue. (37:59) And so you'd basically be taking revenue away from those football and men's basketball players who are responsible for generating most of the revenue.
(38:09) Now, with that being said, I'm certain that if schools decide to pay all the money to football and men's basketball players, that there will be more lawsuits against the NCAA about the other athletes not getting paid. (38:23) That's why when we talk about the long-term ramifications of this thing, so much is unknown because the settlement does not protect the NCAA against future litigation. (38:33) And there's most likely going to be future lawsuits connected to this that are going to force the NCAA's hand into further changes.
(38:42) But that's certainly one of the biggest questions right now is just what kind of requirements are there going to be on the universities to pay athletes across a broader variety of sports or will there not be any? (38:58) And then will schools just allocate the revenue to whoever they want? (39:03) Yeah, for me, I would caution against, if there's a way to scale back, limit which sports you're paying, I would caution against paying a vast array of sports for, again, how much control you can have over that for schools because that's going to make it harder to keep as many programs.
(39:25) If you have to pay athletes in every program, all sports, that means that the programs you want to donate more resources to, football, men's basketball, it's just the nature of this, are going to have less of a cut. (39:42) And so that's going to incentivize schools to cut the programs altogether rather than pay those athletes. (39:48) That's the nature of the business, I'm sorry to say.
(39:50) So that would be my caution against, if there is any control over whether you can distribute to certain sports or not, trying to focus on the sports that generate revenue. (40:02) And that, again, to your point, that's fair from an economics perspective of those are the athletes that are generating the revenue in the first place. (40:10) Therefore, they should get a cut of that revenue.
(40:12) Now, I am also of the opinion that another way to keep all 36 sports intact if you're Ohio State or a good number of them, other schools, is to find ways for those sports that aren't generating revenues currently, try and find ways for them to generate more revenue, not just donations, but look at Ohio State wrestling, women's basketball, hockey, they get decent attendance numbers. (40:40) Women's basketball, especially this year, saw a surge in attendance. (40:45) Wrestling packs out the caveli on a regular basis, like maybe charge more for tickets.
(40:50) I know that's a burden on fans, but those fans are trying to support that program. (40:55) Maybe that's an avenue to let them do that. (40:57) If you have to raise ticket prices to keep more programs around and also fund the programs that those fans are supporting in a bigger way, in a better way, that might be the way you have to do it, is raise some ticket prices or maybe try and get better with marketing, merchandise, sponsorships, those things.
(41:16) Find ways for the sports that aren't generating a lot of revenue right now, that are suffering a deficit, to close that deficit, maybe even start turning a profit. (41:26) I think especially at Ohio State, there's a lot of interest in sports that aren't football. (41:31) Football is maybe even 90-some percent of it, but it's definitely numero uno, not even close.
(41:38) But with all of the alumni, with all of the athletic culture and history at Ohio State, there is plenty of interest and potential revenue to be tapped into in a greater way for some of those other sports. (41:53) And I think that could be another way to help not only keep a lot of sports, but keep a competing at a higher level than if you kept everything the same as it is and just tried to share revenue and have this extra expense into everything. (42:12) I think another big question with this is just how effective it's going to be in terms of cracking down on schools that try to work around the revenue sharing cap, work around that 22% of Power 5 conferences.
(42:29) A lot of college administrators, again, have confidence that you're going to have that stronger enforcement arm, as we referenced earlier, when it comes to NIL. (42:39) NIL has been the complete wild, wild west for the few years. (42:42) Is there going to be enough of an incentive to bring schools in-house?
(42:46) Or are you maybe even going to require schools to bring it in-house? (42:50) And then that way, you can maybe enforce it easier against the actual athletic departments than these third-party electives that are facilitating the NIL as it is. (43:01) I think that's the first key, is getting all of the collectives brought in-house to the athletic departments so that you can then...
(43:09) It's much easier to regulate the athletic departments and the university level of things than it is a third-party, basically private business in some cases, or non-profits even, depending on how you start and form your collective, right? (43:27) Those are, I think, much harder to regulate than if it were in the actual athletic departments. (43:34) So finding a way to get that in-house for me is the first step.
(43:37) And then from there, you can find better ways to prevent bad actors from entering, to prevent schools from finding unintended ways to pay their players. (43:48) Yeah. (43:49) I mean, you have to have a system in place where all this revenue sharing is getting reported.
(43:55) Again, you go back to the NFL analogy, every contract is reported to the league. (44:00) They know exactly how much each team is playing, is paying its entire pool of players. (44:07) I would imagine there's going to be something similar in place with this revenue sharing structure that when the schools report their finances at the end of the year, they're going to have to report exactly how much they paid out to the athletes across each sport.
(44:22) And I think, again, by bringing those things into the athletic department, it's easier to police that. (44:28) Whereas there's just not a great system in place for really regulating those collectives, because there is no federal law. (44:37) So they're all just kind of holding to their own state laws.
(44:41) And the NCAA can't really do anything about it right now. (44:43) So certainly I think that's going to be the goal for the NCAA is to find a way to regulate and structure all this. (44:53) How successful will they be?
(44:55) We'll see. (44:56) I mean, they haven't been very successful in their efforts to do that before. (45:00) So it's hard to be super confident that they're going to have a great system in place now, but I think they're at least taking a step in the right direction here.
(45:10) I think the bigger picture question is, is this going to be a permanent solution, or is this just going to be a temporary fix? (45:20) And I think the answer is likely the latter, because as I said before, this settlement doesn't prevent future litigation against the NCAA. (45:27) They're still facing another lawsuit related to revenue sharing in Colorado that those plaintiffs have decided not to join the other lawsuits.
(45:38) They want to go at it on their own. (45:40) And so it's possible if that lawsuit is won against the NCAA, that this could break down before it even starts. (45:48) Like I said, most likely one way or another, there's going to be more lawsuits to come in the future.
(45:53) And so I think this is a step in the right direction for the NCAA that's going to help them in terms of keeping some control over things now, but I don't think this initial revenue sharing model is going to be the final iteration of what we see five, 10 years from now. (46:10) I think this is likely going to be an ever evolving beast for some time. (46:14) And I think to me, the next logical step now is for schools to collectively bargain with their athletes.
(46:23) There's been no indication that will be part of a new model yet, but it's definitely something that athletes want and are pushing for. (46:30) And I think it's going to be necessary if you really want to create a system that works for everybody. (46:38) Because I think like one specific example of that is, I think one thing a lot of people would like to see now that there is a revenue sharing model in place is some form of contracts for athletes to where they have to make a commitment to a school for a period of time, rather than just transferring every time they want.
(46:57) Now that the laws have basically taken the power to restrict transfers out of the NCAA's hands, the only way you're going to be able to do that now is by collectively bargaining it with the athletes. (47:10) And so I do feel like that's the next logical step here for college sports. (47:15) Now, does that mean athletes becoming employees?
(47:18) Not necessarily, but College Football Players Association, which has been trying to create a players union for college football. (47:24) They recently came out and said that they're going to push for a non-employee collective (47:30) bargaining system because the employee thing has been such a big debate that nobody really (47:34) agrees on that they want to create a system where athletes don't necessarily become employees (47:40) of universities, but they still have that seat at the negotiating table to negotiate issues (47:47) like how much they will be paid, whether they will have to make commitments to their schools.
(47:52) I think that's a step that's going to need to happen at some point. (47:57) Again, if the NCAA doesn't proactively make it happen, it will probably be forced upon them at some point. (48:03) And I think to make this system work for everybody, I think that's something that's going to be necessary at some point.
(48:13) I think this system that college sports is about to move toward is better than the collective (48:23) driven system we have right now, but I think without knowing exactly what it's going to (48:29) look like, because those details haven't been finalized yet, I think this system is (48:36) definitely a step in the right direction, but I think it's still going to be far from (48:41) a perfect long-term solution for college sports. (48:44) That is, to me also, the next logical progression of this is collective bargaining.
(48:50) And there's a lot of complications with trying to make a student an employee, trying to make student athletes employees, because there's different labor laws in different states. (48:59) There's a lot of different considerations and complications that come into play when you're trying to make them employees as opposed to maybe a collective bargaining structure where they're not employees, but you can still bargain with the athletes. (49:15) And at what level then is that collective bargaining facilitated?
(49:20) Is it individual schools collectively bargaining with athletes? (49:23) Is it conferences? (49:25) Is it FBS as a whole?
(49:27) Is it D1 Athletics as a whole? (49:29) How does that work would be the next question I would have for that system. (49:33) But I do think it's probably the best way to marry the interests of the athletes with the university is to give both sides a voice, is to facilitate a platform where both can voice their desires, their concerns.
(49:51) And then it creates the structure and the regulation that NIL has so been lacking since it became a thing a few years ago. (49:59) And that is why I think it's the final progression of this, getting back into a place where it's structured and there's a clear plan moving forward for collegiate athletics and player pay and just the future. (50:16) And it'll also be a model that can be better structured around the structural changes of the sport that have been coming over the past few years and might be coming down the line.
(50:27) You talk about a potential Super League in the future. (50:30) You talk about how conferences are continuing to realign. (50:34) That will also, it's good to have that structure in place for when those things happen as well so that there's a clear plan of roster building and how that's done for teams, regardless of where they might lie in terms of a whole new league or a new conference, what happens.
(50:54) You do make a good point when you talk about, you know, athletes across a wide variety of (50:58) sports across divisions, one, two, three, et cetera, because, you know, that's kind (51:03) of where the analogy with like the NFL breaks down a little bit is, you know, the NFL you're (51:07) talking about, if you go off season roster size, you could say 90 players times 32 teams (51:13) and college, you're talking about thousands of athletes across a wide variety of sports (51:21) that are very different from one another across hundreds of schools, you know, ranging from (51:26) Ohio state to Ohio Wesleyan, you know, it's, it's very different. (51:30) You know, the experience of a football player at Ohio state is very different than the experience of a soccer player at Ohio Dominican. (51:41) So it does create a lot more complications and that's why this stuff is almost never simple, but it's one of those things.
(51:51) I'm sure we're going to have more conversations about more changes coming to college sports in the future because it is an ever-changing thing. (52:00) We are in the midst of a time of change in college sports. (52:04) And certainly I'm sure there's plenty of people out there who are ready for us to get back to the nitty gritty of talking about Ohio state football.
(52:11) And we will get back into that. (52:13) Plenty of crooning talk likely to come here on Real Pod Wednesdays or the next month as well as official visits start this weekend, camps start up next week. (52:22) So probably a lot of focus on recruiting as well as the ramp up to the Ohio state football season coming up here on the show.
(52:30) But this is a big deal for college sports. (52:32) I mean, this is a, a massive change for college sports and felt like, you know, we needed to take some time to really dive into the nuts and bolts of it and talk through some of the questions that surround it. (52:44) And we talked about there's still a lot to be determined.
(52:47) So probably still plenty more for us to discuss on this topic over the next year before this new revenue sharing model actually goes into place. (52:57) Absolutely. (52:58) And, you know, I, I think this makes this a very productive conversation and, you know, it's fun to have these little breaks where we're talking big picture college football stuff in large part with a little bit of localization to Ohio state before we hop back into the nuts and bolts of football.
(53:14) You know, I, I can't squeeze all that football juice and knowledge out of my brain every week. (53:18) We got to have a little change up here and there. (53:21) Yeah.
(53:21) Still about three months to go until Ohio state football season, though. (53:25) I'm sure it will be here before we know it. (53:28) We hope that you will all continue to keep up with us here on Real Pod Wednesdays.
(53:33) We enjoy talking to you every week and we'll be back next week for more.