Game Over for Amateurism? The New Economics of College Sports
By Avery Sneed ‘27
Introduction
For more than a century, the NCAA has defended the principle of "amateurism" as the line that distinguishes college sports from professional athletics. Athletes could receive scholarships, housing, and modest stipends, but never direct compensation for their efforts. That system has been unseated with remarkable speed. On July 1st, 2021, amid mounting pressure from state legislatures and pending litigation, the NCAA voted to suspend restrictions on athletes profiting from their names, images, and likenesses (NIL). For the first time, players could sign endorsement deals and participate in the marketplace without the fear of sanctions or loss of eligibility. Only weeks before, the Supreme Court’s unanimous decision in NCAA vs. Alston (2021) underscored the fragility of the NCAA’s “amateurism” defense, in holding that the NCAA was violating antitrust law by prohibiting schools from providing education-related benefits (computers, graduate scholarships, tutoring).
Alston laid the groundwork for what came next. In June 2025, Judge Claudia Wilken approved a $2.8 billion settlement in House v. NCAA (2025), compensating athletes for lost NIL opportunities before July 2021, and more importantly, authorizing schools to share revenue directly with athletes beginning in July 2025. If Alston was the end of amateurism as a legal defense, then House marked its burial in practice. More than ever, the line separating college athletes from professional athletes has become increasingly blurred.
The Decline of Amateurism
The NCAA has long defended its right to limit athlete compensation on the assertion that amateurism provides consumer demand. Thus, the otherwise anticompetitive nature of limiting compensation for student athletes served a pro-competitive justification. By tying amateurism to consumer demand, the NCAA could argue that its restrictions actually preserved competition rather than suppressed it. In NCAA vs. Board of Regents (1984), the Supreme Court struck down NCAA television restrictions under antitrust law, but acknowledged that the NCAA’s amateurism rules served a legitimate purpose in distinguishing intercollegiate from professional athletics. For decades, that reasoning protected the NCAA from broader challenges. That protection weakened in O’Bannon vs. NCAA (2015). The Ninth Circuit held that prohibiting athletes from receiving compensation for their names, images, and likenesses violated the Sherman Act. While the remedy was limited to just cost-of-attendance compensation, the case established that amateurism could no longer shield the NCAA from antitrust scrutiny entirely.
The final blow came in Alston. The Supreme Court unanimously struck down NCAA rules prohibiting universities from providing education-related benefits, such as computers and graduate scholarships. Justice Gorsuch, writing for the court, rejected the NCAA’s reliance on Board of Regents, and Justice Kavanaugh’s concurrence went even further, stating that the NCAA’s compensation restrictions would be “flatly illegal in almost any other industry.” Just weeks later, the NCAA would vote to suspend its ban on NIL deals, allowing athletes to sign sponsorships nationwide. The combined force of the Alston decision and the NCAA’s move to pave the way for NIL compensation had rendered amateurism outdated, and indefensible in court.
House vs. NCAA and the new model
The next massive step came in House vs. NCAA, filed in 2020 by Arizona State swimmer Grant House and Texas Christian basketball player Sedona Prince. The plaintiffs sought NIL damages and an injunction to force the NCAA to lift restrictions on revenue sharing from broadcast rights. They alleged that the NCAA and Power Five conferences (traditionally the ACC, SEC, Big 10, Big 12, and PAC-12) had unlawfully suppressed NIL opportunities for athletes before July 1st, 2021. After years of litigation, the parties reached a $2.8 billion settlement that was approved by Judge Claudia Wilken this past June. The settlement requires the NCAA to pay back billions in damages over the next decade. More importantly, it authorizes schools to directly share revenue with athletes for the first time. Beginning July 1st, 2025, each school may allocate up to $20.5 million to share among their athletes, with an incremental increase in subsequent years. This new arrangement fundamentally alters the relationships between student athletes and their universities. Now, compensation may take the form of scholarships, third-party NIL deals, and paychecks straight from the university.
How schools will divide these funds remains uncertain. The settlement does not mandate one singular model, leaving construction of plans at the discretion of individual athletic departments. Experts expect most schools to share the majority of revenue with their football and men's basketball programs, which generate the most revenue, but some may adopt more balanced or incentive-based models. This past March, the American Athletic Conference, of which Charlotte is a full-time member, became the first conference to introduce a revenue-sharing minimum. The American will require its member institutions to share a minimum of $10.5 million with student athletes over the next three years. Member institutions will be permitted to reach that $10.5 million goal in any way they see fit, so long as it’s met at the end of the 2027-28 academic year. Failure to reach this goal may threaten conference membership, says Commissioner Tim Pernetti, but this sort of structured investment program allows the “Group of Five” conferences, such as the American, to stay competitive in an increasingly disproportionate market.
The Future of College Athletics
The introduction of revenue sharing raises just as many questions as it answers, and may present more problems. Its effects will be felt across athletic departments, conferences, and athletes themselves. At the top of the food chain, Power Five schools are in the best position to thrive in this new era. With lucrative broadcasting contracts and expansive donor networks, they can fill the $20.5 million cap with ease, while still spending enormous amounts on coaches and recruiting. For mid-majors, like Charlotte, the math is more complicated. Many operate on razor-thin margins, and experts have warned that the settlement may force cuts to non-revenue sports or increased dependence on student fees and donations. This imbalance may exacerbate the existing stratification of college sports. The top programs grow richer and more attractive to recruits, and the smaller programs struggle to keep pace.
Legal questions are even murkier. Title IX requires gender equity in athletics programs, and if the majority of funds are distributed to male athletes, litigation is almost guaranteed. Title IX compliance has typically been measured in three areas: proportional participation opportunities, scholarship equivalence, and equity in treatment and benefits. Up to now, scholarships have been the primary focal point of scrutiny from the courts. However, with the introduction of direct revenue sharing, the courts will have to decide whether these new payments should be treated like academic scholarships for Title IX purposes, or a new category of compensation. If revenue sharing is deemed equivalent to scholarships, then schools will be required to distribute funds in a way that represents gender proportionality. For instance, if women made up 45% of a university’s athletes, then those women would likely need to receive 45% of the revenue-sharing funds. This poses an obvious challenge for the vast majority of schools where football, with massive rosters and large revenue streams, will take up most of the compensation pool. A school that channels nearly all $20.5 million into football and men’s basketball will almost certainly find itself facing claims from female athletes who argue they are being denied their fair share of monetary benefits under Title IX.
On the other hand, if courts classify revenue sharing under another category, Title IX protections may not apply in the same way, leaving a gap in gender-equity protections. Congress could step in and clarify this issue with regulatory legislation, but until then, universities may have to operate in an area of legal uncertainty. Nonetheless, litigation seems likely. Female athletes in non-revenue sports, especially those with strong participation numbers but little financial return, will likely test these questions in court. However, the court's choice to decide will have profound consequences, no matter the decision. A proportionality requirement could force schools to significantly alter how they allocate funds, whereas a looser standard could exacerbate disparities between men's and women's programs.
Conclusion
Amateurism as the NCAA’s legal shield is no more. The doctrine steadily eroded from Board of Regents through Alston, and the House settlement was the nail in the coffin. The settlement’s revenue-sharing model fundamentally reshapes college athletics, transforming athletes into compensated participants and forcing schools to grapple with a largely unprecedented world of financial, legal, and cultural consequences. The next decade will be crucial in determining whether college athletics remains a uniquely educational enterprise or evolves fully into a professional marketplace. What is clear now is that amateurism, once the backbone of the NCAA, is now a thing of the past.
Avery Sneed is a junior majoring in political science.
Sources
National Collegiate Athletic Assn. v. Alston, 594 U.S. 69 (2021)
National Collegiate Athletic Assn. v. Board of Regents of the University of Oklahoma, 468 U.S. 85 (1984)
O’Bannon v. National Collegiate Assn., 804 F.3d 1049 (9th Cir. 2015)
House v. National Collegiate Athletics Assn., 545 F.Supp.3d 804 (2021)
Title IX, Education Amendments of 1972, 20 U.S.C. §§ 1681-1688 (1972)
Allen, A. (2025, September 26). NIL Shake-Up: How revenue sharing is reshaping risk in college sports. University Business. https://universitybusiness.com/nil-shake-up-how-revenue-sharing-is-reshaping-risk-in-college-sports/
Associated Press. AAC sets minimum for schools to share revenue with athletes. (2025, March 13). ESPN. https://www.espn.com/college-sports/story/_/id/44226335/aac-sets-minimum-schools-share-revenue-athletes
Marcello, B. (2025, June 6). House v. NCAA settlement approved: Landmark decision opens door for revenue sharing in college athletics. CBS Sports. https://www.cbssports.com/college-football/news/house-v-ncaa-settlement-approved-landmark-decision-opens-door-for-revenue-sharing-in-college-athletics/
Reid, A., & Smalley, A. (2025, June 9). What the NCAA Settlement Means for Colleges and State... National Conference of State Legislatures.https://www.ncsl.org/state-legislatures-news/details/what-the-ncaa-settlement-means-for-colleges-and-state-legislatures
