A significant chapter in collegiate athletics came to an end last Friday when U.S. District Judge Claudia Wilken officially approved the House v. NCAA antitrust settlement. This landmark decision dismantles the 119-year-old amateurism model, paving the way for schools and athletes to share millions of dollars for the first time. The $2.8 billion, decade-long agreement will compensate former players for missed opportunities related to their name, image, and likeness (NIL) while allowing current athletes to receive direct payments starting July 1. NCAA President Charlie Baker hailed the settlement as a major step forward, emphasizing its potential to stabilize college sports and establish clear regulations for third-party NIL agreements.

The settlement resolves three major antitrust lawsuits and includes provisions for back payments to athletes who competed between 2016 and 2024. It also introduces new roster limits across various sports, though schools have the flexibility to temporarily exceed these limits for existing athletes. Football rosters, for instance, will be capped at 105 players, but most institutions are expected to maintain larger teams by grandfathering in current athletes until their eligibility ends.

This transformative agreement was initiated in 2020 by Arizona State swimmer Grant House and basketball player Sedona Prince. Their class-action lawsuit sought to eliminate restrictions on revenue sharing from media rights. Powerful legal representation from attorneys Steve Berman and Jeffrey Kessler played a crucial role in achieving this historic outcome.

While the settlement ushers in a new era for college sports, it also raises questions about how revenue-sharing will impact burgeoning NIL deals with third parties. To address concerns over excessive compensation, a new enforcement entity will scrutinize such agreements beginning July 1. The power conferences have enlisted Deloitte and LBI to develop software capable of analyzing NIL contracts and ensuring they align with fair market values. An arbitration process will handle disputes, providing swift resolutions on eligibility and penalties under the revised framework.

Institutions face challenges in determining how to allocate up to $20.5 million among their sports programs. A likely scenario involves mirroring the distribution formula outlined in the settlement, where football players would receive approximately 75% of future revenue, men’s basketball 15%, women’s basketball 5%, and all other sports combined another 5%. However, some schools may adopt alternative models based on each sport's gross revenue average, potentially reserving over 85% of funds for football players.

The implementation of these changes marks a pivotal moment in college athletics history. As schools navigate the complexities of revenue-sharing and NIL compliance, the establishment of the College Sports Commission will oversee enforcement and ensure adherence to the settlement’s terms. Moving forward, the NCAA anticipates a more structured approach to regulating athlete compensation, fostering fairness and transparency within the industry.