Revenue sharing will cause a ‘monumental shift in college athletics’
A week or so ago, in a conversation with Ole Miss athletics director Keith Carter, he mentioned the urgency of the Southeastern Conference to discuss and figure out revenue sharing for student-athletes when the annual SEC meetings take place in Destin this summer.
Indeed.
There hasn’t been a more pressing and important issue for conference members since the last TV contract was negotiated or since Texas and Oklahoma were voted into our conference.
“This will be the most monumental shift in college athletics ever and it is going to be important how we navigate this change,” said Carter the last time we talked.
Before going further, let’s make sure everyone understands one caveat here – a lot of what is written today will be speculation, but it is speculation founded on conversations with people who should be in the know.
Let’s start with what the consensus of the revenue sharing is anticipated to cost. The folks we have talked to guesstimate it to be somewhere in the 16-20% gross revenue range. Yes, gross revenue – off the top money.
So, let’s do a hypothetical here. Let’s say an athletic department has $150 million in revenue from TV money, ticket sales, CGAs, concessions, etc. Twenty percent of that would be $30 million for student-athletes to divvy up. Sixteen percent, the lower end anticipated, would be $24 million.
A lot of coin. A big chunk of the budget.
Assuming that is in the ballpark, how that money is going to be shared is an issue that has to be decided. What is the Title IX component? Will women’s sports get an equal share? What about non-revenue sports? Do revenue generating sports participants get more money than non-revenue sports athletes?
Will some schools who are not as financially capable as the top tier schools actually have to cut non-revenue sports?
These are all questions that will have to be decided by the powers that be.
And the biggest question of them all – where will that money come from?
Most athletic departments operate around the break even mark now before revenue sharing. At the end of each fiscal year, athletic directors are somewhat pleased if the department is not running a deficit and the books aren’t splashed in red ink.
“Our biggest challenge will be creating revenue to cover the revenue sharing costs,” Keith allowed.
He did not want to get into ways of doing that at this time, but it’s obvious there will be some “cutting of the fat” and tightening of the belts involved besides expanded fundraising efforts.
The collegiate sports scene has seen more dizzying, substantial changes in the past five years or so than in its entire history of over 100 years with name-image-likeness (NIL) and the new transfer rules, but revenue sharing may top them all in importance and impact.
Revenue sharing, by the way, could come about as early as July of next year, 2025.
Stay tuned. . . . it’s about to get real interesting.
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