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Couch: The biggest story in MSU and college athletics is flying under the radar – with tough decisions ahead

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4 months ago

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Couch: The biggest story in MSU and college athletics is flying under the radar – with tough decisions ahead

The biggest story in college athletics is flying under the radar, mired by its complexity and lost beneath the enthusiasm for a new college football season.

But, a year from now, an already rapidly changing college athletics landscape could feel another major shift. The decisions made between now and then will be illuminating and lasting, lucrative for some and painful for others.

This stems from the settlement of three antitrust court cases (House, Hubbard and Carter) centered around the compensation of college athletes, agreed upon by the NCAA, the most powerful conferences in college athletics and lawyers for the plaintiffs.

The important details include $2.8 billion dollars in back pay for current and former athletes (mostly football and men’s basketball players) dating back to 2016 (paid out over 10 years) and, more significantly, revenue sharing with current athletes, with schools paying their athletes up to 22% of certain inventory (media rights, sponsorships and tickets sold) — which, for the 2025-26 school year, will total close to $22 million for each of the power five conference schools, Michigan State included. There will also supposedly be new NCAA oversight with third-party NIL deals, though we’ll see whether there is any teeth to that enforcement. There is some recent legal resistance to the settlement, but, as it stands, this is what’s coming. And, in some form, where it’s headed regardless.

In case you’re wondering, MSU, which is in better financial shape than most, doesn’t have $22 million in its athletics budget sitting around. This is where the difficult decisions for schools begin — either trimming and scaling back and hoping it adds up to $22 million or taking a chunk out of the budget by cutting sports programs altogether. Schools will have some flexibility in how they distribute the money, but if they want to compete — meaning recruit and retain athletes in prominent sports — they’ll distribute the money.

All of that could wind up being helpful in a new world of college athletics that otherwise doesn’t seem to be on a sustainable trajectory — from donor fatigue, which makes NIL collectives an uncertain long-term model, to fan disillusionment, as the bonds alums once shared with athletes become short-term and transactional.

However, the piece of this that make zero sense and reeks of lawyers and folks with no regard for the holistic nature of college athletics — and will be felt at MSU and every school like it — is the change in scholarship limits, allowing every sport to offer scholarships up to their full roster size. 

Football will go from 85 scholarships to 105 allowed, men’s basketball from 13 to 15 (women’s basketball is already at 15), men’s ice hockey from 18 to 26, women’s volleyball from 12 to 18, baseball from 11.7 to 34, softball from 12 to 25, wrestling from 9.9 to 30 and so on and so forth. 

There are two big caveats here. First, no school can afford all of these extra scholarships. They’re not just free things to give out. Athletic departments pay that tuition. Secondly, and what’s been underreported, is that a portion of each school’s revenue-sharing cap is tied to the number of scholarships it currently has in each sport. For every scholarship you add, without taking one away, it cuts into a portion of that nearly $22 million in revenue a school can share with athletes, up to $2.5 million. For example, if MSU added 20 football scholarships, two in men’s basketball and eight in hockey, the cost of those scholarships — roughly $30,000 per scholarship for in-state tuition — would be taken out of the money it could pay athletes. 

But, if you wanted those 30 men’s athletic scholarships added, you could cut 30 other men’s athletic scholarships and not take hit in the revenue you could share. 

That’s where this starts to stink.

Schools are now going to have to make hard choices about which sports they want to prioritize and which they don’t. And just standing pat could leave you at a disadvantage against your competition if other schools choose differently.

For example, Vanderbilt, which doesn’t win in much of anything of any profile but baseball, could choose to offer 34 baseball scholarships and take those scholarships from other sports. Iowa might decide to add 20 more wrestling scholarships and further separate itself from other programs. SEC schools, which have largely never cared about broad-based athletic opportunities, are likely to cut some sports altogether. MSU athletic director Alan Haller has stated that MSU will need a new AD before they go that route. But he’s still going to have to make painful decisions about of the level of financial support some of MSU’s athletic teams receive.

Football, of course, will not suffer. But college football teams also don’t need 105 scholarships. They don’t play close to that many players in a season and can’t travel that many players to road games. Having 105 scholarships will likely help separate the Ohio States and Georgias even further and increase the gap between the power five and mid-majors. It’ll also increase traffic in the transfer portal. There will be even more unhappy players. And, at a lot of football programs, this could be the end of walk-ons. 

These changes aren’t next-year decisions. Coaches in every sport have to know how many scholarships they have to offer and what their budgets are like — including how much they’ll be able to offer athletes directly. They’re already recruiting for 2025-26 and beyond. But the decisions are coming.

This increase in the number of scholarships — allowing greed to fester in revenue sports at the expense of opportunities, which is what’s going to happen most places — was needless. 

It is clear, however, that some form of direct revenue sharing is the right thing to do, given the amount of money being generated in college athletics, largely by football. The old system — pre-transfer portal and before recruiting with six- and seven-figure NIL deals became necessary — was ideal for fans and coaches, but, for some athletes, was oppressive in nature. 

Yet what should be recognized at some point is that the old way, warts and all, is what built the popularity of college sports. It’s what led to the obsession that created the current financial market.

People who are making these decisions — the NCAA, schools and conference administrators, representatives of athletes and perhaps the athletes themselves at some point — should be mindful of that. You can turn off fans. The more transactional and transient this all gets and the more that sports are cut for the sake of maximizing football, the more you risk folks not recognizing the programs and teams they once fell in love with, especially fan bases that get left behind. 

I think MSU will be as OK as just about anyone. I like that the plan in East Lansing is not to cut sports, even if some sports have to make do with less. I think most of the Big Ten is likely to see it that way. 

Still, it’s going to push the boundaries of competitive balance and in ways that might make college sports less appealing. 

Contact Graham Couch at gcouch@lsj.com. Follow him on Twitter @Graham_Couch.

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