A nearly $2.8 billion settlement approved by the National Collegiate Athletic Association (NCAA) and the five largest conferences in the United States will bring in a revenue-sharing model that will allow colleges to pay student athletes for the first time starting as soon as the fall 2025 semester.
The settlement, pending approval from plaintiffs and a federal judge, will see damages paid to thousands of former and current college athletes who argued that NCAA rules prevented them from earning endorsement money.
Under the settlement, damages will be paid over 10 years to approximately 14,000 claimants dating back to 2016.
The revenue-sharing agreement proposed in the settlement is set to funnel millions of dollars directly to college athletes.
Each school will be allowed but not required to set aside up to $21 million in revenue to share with athletes per year, with athletes in all sports eligible for payments.
“This landmark settlement will bring college sports into the 21st century, with college athletes finally able to receive a fair share of the billions of dollars of revenue that they generate for their schools,” said Steve Berman, one of the lead attorneys for the plaintiffs.
“Our clients are the bedrock of the NCAA’s multibillion-dollar business and finally can be compensated in an equitable and just manner for their extraordinary athletic talents.”
NCAA president Charlie Baker and the commissioners of the Atlantic Coast Conference, Big Ten, Big 12, Pac-12 and Southeastern Conference said in a joint statement the settlement was: “An important step in the continuing reform of college sports that will provide benefits to student-athletes and provide clarity in college athletics across all divisions for years to come.”