The End of College Sports? House v. NCAA Fallout, Big 12 Budget Crisis & Title IX Impact

In this episode of First and 12, we dive deep into the potential collapse of college athletics as we know it, following the monumental House v. NCAA settlement. With schools potentially facing $20 million annual payouts to athletes, programs across the Big 12, Group of Five (G5), and beyond are bracing for financial strain. We break down how this case could cripple athletic departments, force tough Title IX decisions, and even lead to the elimination of Olympic and non-revenue sports. Will this lawsuit signal the death of traditional college football and college athletics as we know them?

Keywords:
House v. NCAA, college sports lawsuit, NCAA settlement, Big 12 athletics, paying college athletes, Title IX college sports, Group of Five football, college football future, NIL, college athletics reform, First and XII podcast

Transcript

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Are we about to witness the end of college sports? I'm not exaggerating. We're going to talk about that on today's show. Ramon will home in state Colorado, Arizona, state Cincinnati. We've got things well covered from end zone to buzzer beaver. This is first and 12 draw access pass to all 16 teams, all in every episode.[music] Hello and welcome to another episode of first and 12 on your host, Adam Gibby. Thank you so much for joining us this Monday over the weekend. We had some crazy news come out from the NCAA and it regards the House first NCAA settlement that was finally settled. This is something that has been expected. It's been something that's been very well covered by other podcasts. I haven't talked about it on this particular show, but given that it is now gone final, I told sports in general. Now, if you are unfamiliar with what the House first NCAA is, I'm going to read a ESPN summary of it. So bear with me. It's going to be a little bit extensive and then I'm going to give my reaction to it. It says, this is the article by ESPN schools are now free to begin paying their athletes directly, marking the dawn of a new airing college sports brought by multi-billion dollar legal settlement that was formally approved Friday evening. Judge Claudia Wilkin approved the deal between the NCAA. It's most powerful conferences and lawyers representing all division one athletes. The House first NCAA settlement ends three separate federal anti-trust lawsuits, all of which claim the NCAA was a legally limiting the earning power of college athletics. Wilkins long awaited decision comes with less than one month remaining before schools are planning to start cutting checks to athletes on July 1st, both sides presented their arguments for approving the settlement at a hearing in early April, while college sports leaders have been making tentative plans for a major shift in how they do business. The tight turnaround time means schools and conferences will have to hustle to establish infrastructure need into enforce their new rules. The NCAA will also pay back nearly 2.8 billion in back damages over the next 10 years to athletes who competed in college at any time between 2016 through modern day moving forward each school can pay its athletes up to a certain limit. The annual cap is expected to start at about 20.5 million dollars per school in 2025, 2026 and increased every year during this decade long deal. These payments are an addition to scholarships and other benefits the athletes already receive. So this is an addition to scholarships Friday's orders of major milestone in the long push to remove outdated amateur and rules from major college sports since 2021 college athletes have been allowed to make money from third parties via name, image and likeness deals, which it's not N I L's just donations, but anyways, boosters quickly organized groups called collective used N I L money as de facto salaries for their teams. And in some cases paid millions of dollars to mostly top rated basketball and football players. I do want to mention that N I L is not going anywhere now. There does seem to finally be some real guards on that at least a little bit to where there's going to be some kind of committee that will actually look at N I L and deemed things worthy or not. I don't know how you can really control that. You know, if a company wants to say, hey, this player's worth a million dollars, how are you going to say they're not? You know, it's just a bad business deal. But that's for another day. You probably saw the title of this episode and saw that it was called the end of college sports. Now, I'm not into clickbait. That is not this podcast view on clickbait glisten to other podcasts. I don't do that. So what's actually going on here? Because this actually the end of college sports and could it be? I think it could be to an extent. I think that this marks a major shift in college athletics and is something that we're going to have to look at. We're going to have to reevaluate and see where we are in 10 years. Here's why there was some data that came out a couple of weeks ago that shared how much revenue each big 12 conference member made. Since Natty came in at the bottom at $90 million UCF and 93 million Houston had 99 I always say it had 101 million. Now, this one's actually very concerning to me. The three schools that did worse than them are on a half share revenue for one more year, meaning that while the rest of the conference got believe us about $40 million in TV revenue, since now the UCF Houston and BYU only got 20 million starting next year. They'll get the full share. That share may dip a little bit because of them getting more money. But essentially, you can add 18 to $19 million on to those three schools. And that's what their number is where Iowa State is going to remain more or less where they're at, at least from a TV revenue standpoint. The reason this is concerning is Iowa State was really good in football and basketball this year. And yet, minus the half share TV revenue, they finished at last in the conference. That's really concerning for Iowa State athletics. Going forward West Virginia and Kansas State, each had $106 million. On the flip side, Kansas had $215 million in revenue. Now, a lot of that was because of a massive push to build the brand new stadium. So they're asking for a lot of donations. They really pushed that this past year. That number is inflated. It's not going to be that every single year. The next team coming in was Baylor at 148 million. There's a lot of deep pockets, a lot of donors. It's a private school. So they're able to get a lot more money. And then Colorado came in right behind them at 147 million. Why am I bringing these numbers up with this new settlement? Schools are now going to be expected to pay $20 million into salaries for their athletes for a team like Cincinnati or a team like UCF, Iowa State, they're not operating in the black. They don't have $20 million sitting around to give to athletes. They just don't have it. And so for them, it's going to be a tough decision. There are going to have to a not play it pay their players the full amount of the 20 million or they're going to have to find a way to make more money. I was looking at Tony Altamore's ex page. Now, if you don't follow Tony Altamore, check him out. He has some great information. Some he does probably the most in depth, deep research into spending into revenue into TV markets into all of that. He does deep dive into spending all of all that when it comes to athletics and college sports. He found that the average team in the big 12. Now, this is the average. The word teams less the word teams more spent $118 million per school to operate for going off of that number. Since now, the UCF Houston, Iowa State, West Virginia, Kansas State, all ran in the red. They all spent more than what they made. That's not a sustainable model. Now you're throwing on the expectation had to pay $20 million. Now, if you were 10 $12 million in debt, now you're staring at a 30 to 32 million dollar deficit. That's not sustainable. That's very dangerous for any school. And it makes things very difficult. It makes things this school have to make tough decisions. Now, there's a couple of decisions that can be made. I think the first and most obvious one is to cut college sports. Am I talking entirely? No, not necessarily. What I'm talking about is the non revenue sports, which is everything except for football basketball, every other sport and even basketball for some schools runs in the red. There are schools in the big 12 that spend more than they make. I think UCF may be one of those schools for as just as an example. They have smaller arena. They travel more than anybody else in the conference and their tickets probably don't go for that much. And so there's a good chance that UCF basketball doesn't actually make any money. Now, school like Kansas, school like TCU, Baylor, BYU now, Arizona, they're definitely making money in men's basketball. For them, it's no no, brainer. You keep that sport. What about every other sport? tennis golf, the cross wrestling, swimming, track, cross country. What happens to those sports? BYU won the national championship in women's cross country this past season. Yet they may not have made more than$10,000 as a team, yet they spent, I'm sure, hundreds of thousands of dollars. It's not cheap to travel across the country. It's not cheap to get lodging into pay for all the training that's involved in the nutritionist and the food. And everything that goes into having an effective cross country team, that costs hundreds of thousands of dollars to operate. Yet they're not bringing in revenue. Texas tech softball just finished as the national runner up in the women's college world series. They lost to Texas in the in the championship game. softball is not making a profit. They're losing money. So how how can you justify keeping these teams when they're not making you money? I don't know. That's where things get very, very interesting. That's where things get a little bit scary. Because I think that's the most logical answer. If you know, Hey, we're $30 million in debt this year. If we cut this sport, this sport and this sport will break even because we're not making money off those sports. You know, women's volleyball, men's volleyball, they're great to go to. They're entertaining, but they're not making money. So that's going to cause some schools to probably have to seriously look in their mirror and say, do we need to cut some of these college sports? Do we need to perhaps trim our teams down? Maybe a basketball team goes from having a roster of 15 players down to having a roster of 11 players. I don't know the legalities of that. But again, it just it almost feels like teams may need to start nickel and diamond things. If that makes sense, you know, you're thinking, okay, we're going on a road trip. We're going to fly. It's going to cost us, you know, an extra night for three players over the course of a season. That's a few thousand bucks. You know, having a freedom. They're not going to the trainers. They're not taking up extra airplane seats. I don't know if a roster is going to be trimmed down. I don't know, sports are going to be cut entirely or what's going to happen. And additionally, and I realize again, this is a big 12 show, but this is about college football. This is about college basketball. This is about college lacrosse, college swimming, track and field across the board teams in the Mountain West. They're at annual revenue. Again, this is according to 20 out of more. They're spending revenue was $44.8 million on average. So the average mountain West team needed $44.8 million to operate last year. Now you're going to throw $20 million on top of that. How is Boise State going to suddenly cover an extra $20 million? How is you know, be going to cover an extra $20 million? Maybe they can. They may be the exceptions. I mean, you look at teams though, like, like Utah State, Appalachian State, Georgia, Southern, Troy, how are they going to survive? As it is, there's no way that they're breaking even as it is. Most athletic departments aren't actually breaking even right now. And that's actually been a major issue. I couldn't find the data for the big 12, but I do remember seeing it. And I was hoping it was by Tony Altimore. I don't believe it was. I looked his page up up and down for 20 minutes. But I do remember seeing that there are multiple big 12 teams that are already running in the red. How are these G5 schools going to survive? Are they going to turn to football only schools? And then title nine comes into that. How do you justify title nine? Do you have these schools operate as football and women's soccer only with cheerleading? It kind of feels like we may be heading that way. Or maybe they decide, hey, we're going to go do FCS where the expectation is a little bit lower. Because here's a deal. And as it is, rice, Troy, Southern Mississippi, Tulane, coastal Carolina, Utah State, Wyoming, they already know they're not going to win the national championship in any sport, at least any revenue sport. And that's unfortunate for them. But it's also just a reality. You know, there's no world where Troy football makes it to the college football playoff. When's three games plays Georgia in the national championship and wins. It's just not going to happen in in today's sport. So maybe these teams look at themselves in the mirror and they say, you know what, it's not worth to be playing for the same championship. Let's go to the FCS level. They're the expectations are a little bit lower. We're not expected or needing to pay the 20 million dollars, which already they're not needed. It's there's no law that says they have to pay 20 million dollars. It's just a an assumption in a way. It's a, this is what's happening. So either keep up or be left behind kind of deal. And maybe as a conference, there are conferences such as the Sunbelt or conference USA, let's say we can only pay five million a year to our athletes. Maybe they agreed to that. And then they have their recruiting battles and they'll win some. They'll lose a lot. But that's the reality. I don't know what's going to happen here. This is uncharted territory for sure. And I'm not sure how it's going to work itself out. Here's a couple pitfalls with this. Number one, I know I kind of mentioned it earlier, but title nine, the expectation is that 70% of the money is going to go to football 20% is going to go to basketball. And then 10% or less is going to go to the other non revenue sports. That is at least 90% going to men's sports, unless than 10% going to women's sports. That says title nine loss who's all over it. And so either teams are going to have to agree to pay 10 million women sports, 10 millions to men sports, or they're going to have to up it up to 40 million. I don't see how this stays legal. I don't see how this goes to a court of law where all these women athletes who are working just as hard as the male athletes who put in all the training who put in the same amount of work go to a court of law and say we're doing essentially the same thing, different sport, but essentially the same thing. And we're getting paid pennies on the dollar. I'm not going to get into the whole gender gap thing. I have my opinion on it. I'm sure you do as well. This is not a politics show. But if there is a gender gap, that's where it's going to show up. And that is not going to fly well in any court of law. So again, maybe teams just have to say we're cutting sports. There could be entire schools that cut their athletic department. It could happen. We saw a stand for a couple of years ago, cut a couple of their Olympic sports because they didn't have the money for them. Now you're throwing on an extra 20 million price tag and you think those same sports are going to survive. It's just not going to happen. So what is going to happen? I think there's a couple of possibilities. I think the first is that I mentioned, I think a lot of schools may just go football basketball. I think that the P4 schools overall are going to be okay. I think they're going to go to their donors, the ones that are bringing up there, you know, their big NIL collectives, their NIL donations, as I call them. And they'll say, Hey, you know, you've been giving $5 million to this collective. We need that $5 million now for salaries. Can you help us out? I think that's the most logical thing that's going to happen. Some schools have those donors, some don't. A lot of schools don't, especially the G5 schools. Now, how is that going to affect NIL? It's going to lower NIL. I think it's actually going to make NIL name image likeness. It's going to maybe fix itself where players have actual sponsorships and actually represent a company and there's ROI or return on investment for both sides. You know, the player makes money. The company makes money because they're using the player crazy concept. Professional athletes do it, college athletes do it as well, but they get paid a lot more for it. I think that might correct the NIL issue to an extent. Now, here's the hard part though. This is where I could see in the issue, especially if the title nine issue comes up. There may be a donor who wants to give $5 million, but he's been giving to the football collective. You know, maybe he's a former player. Maybe he just loves football. Now he's being told, Hey, we have to give half this money to the women's volleyball and the women's soccer and the track team. And these donors may say, No, I'm going to stay with the collective actually because I wanted to go to football. And that's fine. You know, if you're a private investor, you want to invest in a particular sport, I have no issue with that at all. The issue is when they become university employees and you're paying one 70% of what you make, you're paying the other less than 10%. So like I said, I don't know what's going to happen there. I think another issue they can come up and this is kind of a, so this is actually going to sound like a crazy thing. But now that athletes are considered employees of the school from what I'm able to pick up on this, they may not be making minimum wage as an athlete. Now football basketball, that's not going to be an issue. But the other 12 sports on campus, that's going to be an issue. Let's say you have 200 athletes between the track teams and the swim teams, the golf teams cross country tennis, lacrosse, wrestling, you have 200 athletes sharing $2 million. That is $10,000 each. If you divide up the hours that they actually are working, be practice games, other events, they're going to make less than minimum wage in a year. I don't know if that's going to be legal. That sounds crazy, but that might actually be an actual reality. You may have the tennis team who only gets paid $50,000 in a year between 10 athletes saying, hey, we only made$5,000 per athlete. We worked a lot more than that. You need to pay us another 200,000 to cover minimum wage for our athletes. That could be where we're going. And again, does that make the school say, okay, well, we need to cut tennis. Sorry. And then go to title nine, you have to stay equal, right? That's why most schools that you see, they have more women sports and men sports because they have to offset football. It has to be somewhere in the same range. So that's why a lot of schools will have a women's volleyball team, but not a men's volleyball team or a women's soccer team, but not a men's soccer team because they need to somehow offset the 105 or so football players that don't exist in women's football. And we see that happen sometimes. We see that sometimes schools will cut two sports at once so they can offset each other. So is this good news or bad news for college sports? I think for the athlete, I think if this is bad news, truthfully, I think this is really bad news. Do I think that it's fair that college athletes aren't paid? No, I don't, but I don't think that this is the correct answer either or at least in the way that it's being done. I think that this is going to kill off a lot of schools. It just is going to cause schools to have to cut out programs, cut out athletic departments entirely in some cases. And it's going to force colleges to make really, really hard decisions. Now, I don't know what's going to happen in the big 12. And I realize again, this is a big 12 show, and I haven't really been talking about the big 12. But I don't know what's going to happen to Iowa State. They're in the red already. Or at least I assume they're in the red. You know, you have a team UCF that's traveling all their sports out to the West multiple times every single year. UCF is flying over to Utah, flying to Arizona, flying to Texas multiple times every single year in every single sport. They can't survive like this. So I don't know what's going to happen to these schools because UCF has to come up with $20 million. So they have to. They're going to be competitive in this conference. They have to come up with $20 million because every other school is going to feel the same pressure. There are enough teams in the big 12 that will be able to cover the 20 million without tanking or losing much further school. Now, I'm thinking Kansas is going to be fine. Baylor is going to be fine. Colorado, they're a mystery, but they feel like they're training in a way that's going to be fine. BYU will be fine. And so when you have those schools being able to pay $20 million to their student athletes, you kind of have to do the same. And I'm just not sure that that's going to be possible for UCF for Iowa State, West Virginia, Kansas State. That's going to be a real struggle. So like I've said, multiple times, this is a huge day for college sports. I think a worst case scenario is that colleges come together and say, Hey, this isn't sustainable for any of us really. I'm talking even like Ohio State Michigan, Alabama. And they say, we can no longer sponsor, and just as a collective group, we can no longer sponsor athletics under these rules. And in which case, the college teams will become privatized, become in a sense minor league teams and operate as true professional markets. You know, Alabama will not be associated with the University of Alabama. They will be the minor league team of the NFL. I don't think that that's going to happen, but it certainly can. Like this isn't the craziest idea in the world. And I've actually seen a few other people throw that this idea out there where sports will become privatized. And schools or teams will no longer be associated with schools. They'll be more associated with geographical locations. And they will be filled with teams of whoever students are non students. Games will not be played necessarily on campus anymore. Now, you know, will they actually be on campus? Yes. But will there be a campus sponsor event? No. Do I think student athletes should be paid? Yes. I do. But I don't think this is necessarily the right way to go about doing this. I think there needs to be some kind of rollout system, you know, an understanding of, Hey, we've been at zero. Let's start off with $10 million. And then next year, we're going to go up to$15 million. And in three years, we're going to be at $20 million. That way that athletic departments can actually really start to plan things out because this is a new idea. This is something that didn't really start to get any attraction until March or April of this past year. Yes. Athletic departments have known about a sense then. And they've been kind of planning for its sense then as well. But that's still not a lot of time to come up with $20 million. You know, we're not talking $20,000 million. That's 20% of some athletic departments budget, or at least they're spending in the case of the G five, it's almost half. So I think that would have been better if we had done this slowly. If we had said, Hey, this is what we're doing. We're going to step it up little by little and we'll go from there. One of my friends going to happen though is that because these are such drastic changes, we're going to see drastic results for those teams for those athletes. I feel bad for you. I feel bad that your college careers may be cut short because of this ruling. So again, going back to what I was talking about at the top. Is this a click, baby title? The end of college sports? I don't think so because I think for some athletes at some schools, it will be. It will be the end of their college sport career. And that's just sad. That's that's really unfortunate. I could be wrong. Hopefully I'm wrong. Hopefully every school is able to figure this out and we're able to pay athletes their fair wage and not just the football players, not just the men's basketball players, but all the women athletes who work just as hard, all the male athletes who play sports that maybe just aren't as popular, but they take the same amount of commitment, the same amount of training, the life commitment to become elite at that sport. I hope they all get compensated for their work because they deserve it. You know, a lot of these athletes are unable to work. They're unable to have a job on this side because they have to spend so much time in their sport and their spending time traveling, their spending time with the team, their practicing going to games, and they can't have another job. So I think it's only fair that they get paid. If you like today's show, please like, subscribe, leave that five star review. I really do appreciate it. Also, if you want to get in touch with me, if you have an opinion on what I talked about today on this show or on any of my shows, feel free to follow me on X at first and 12. That is the word first, if I RST and 12 XII Roman numerals XII or as you see it in the big 12 logo. So first and 12 on X, let me know what you think. I will talk about it on the show. I love getting people involved with the show. Also, just as a reminder, I am starting to mind know the foe later on this week. We're going to have our first interview go live. If you are interested in joining that again, if you know your college football team, like you know the back of your hand, I'm going to use UCF today because I feel like I kind of been bringing the bearer of bad news to you the last couple of episodes. But if you know UCF, like the back of your hand, who their depth chart is, their weaknesses, their strengths, which games they have a better chance on winning than people may not think. Let me know. I'd love to talk to you and I'm not talking about UCF, I've talking to any team. Love to talk to you, get to pick your brain a little bit and you're going to be the expert. I'm going to be asking you the questions and it's going to allow fans of other teams to get to know the foe. Get to know your team as well as get your own fan base a little bit excited about this upcoming season. There's been a lot of sort of down news of past few days, whether it's this new settlement that's going to leave school scrambling to stay afloat, whether it's the news about the college football playoffix changing its format or we need some episodes that are a little bit happier. We need some good news. And so if you'd like to join me please reach out, let me know and we can have that conversation. So thanks again for tuning in today. I'll catch you tomorrow. Bye.[Music]