For college sports fans, March Madness is one of the best times of the year. March Madness is a three-week college basketball tournament, showcasing some of the best basketball at the college-level in the country. This one tournament draws a lot of attention, and the National Collegiate Athletic Association (NCAA) definitely benefits.
For just one sport in that brief period of time, the NCAA brings in over $1 billion in revenue. In 2022, the association realized $1.14 billion in revenue, with $1 billion coming from March Madness alone (Investopedia). In other words, 90% of the association’s revenue came from this single tournament, while not a single cent of this goes towards the athletes playing.
Yes, I’m writing about this age-old argument: should college athletes be paid? But, that’s not all I want to touch on here. While college athletes are the focal point of this argument, there are others impacted by the NCAA’s greed over the years. Today, the NCAA has a serious money problem, all centered around money. And, that problem impacts student-athletes, small universities, and fans alike.
The NIL is Severely Flawed
In 2021, a groundbreaking Supreme Court ruling (NCAA v. Alston et al) allowed athletes to profit off their name, image, and likeness (better known by the acronym NIL). While this was a big win for student-athletes, it was still bitter-sweet, as this ruling didn’t require the NCAA to pay its athletes.
Yes, it’s great that student-athletes can benefit from their own personal brands, but this opened the door for a number of new issues in college sports.
The NIL Benefits Specifically Large Schools
Even without the NIL, larger schools have had a significant financial advantage over smaller universities in the country. Their state-of-the-art complexes and facilities, as well as well-paid coaching staffs, have been more than enough to get top athletes to commit to their schools. Now, with the NIL, these larger schools have an even greater advantage.
While the NCAA doesn’t pay its athletes, the NIL now makes it possible for schools to do so. Let me introduce you to the idea of NIL collectives. NIL collectives are funds supported by fans and donors used to compensate its athletes and incentivize high school recruits (Global Sports Matter). Think of it like an endowment led by alumni solely used for paying athletes. These collectives are seen mostly in college football. For example, University of Alabama head coach Nick Saban has said that his players have made a collective $3 million in a single academic season.
Just to reiterate: the University of Alabama, one of the best college football programs in the country, has a payroll of $3 million. So, not only are recruits and transfers incentivized by the actual success of the program, but they also have financial motivation now to attend Alabama and other elite programs.
This is definitely incredible for these top-tier athletes. I fully support these athletes getting their money while they can. However, do you see how it would be difficult for smaller schools to compete?
Universities and colleges that have huge alumni and fan bases have a huge advantage over smaller schools. Schools like Alabama now only have more incentives to offer, while smaller schools have no way to compete.
In addition to that, with the NCAA recently relaxing its transfer policies, student-athletes now use smaller schools as stepping stones to get into these larger programs. They may spend a year or two at a smaller school, build a name for themselves, and then jump ship to a larger program where they can benefit from their own image and these NIL collectives.
This Hurts Student-Athletes at Smaller Schools
In addition to funding and NIL collectives, larger schools also have bigger reputations that give them an advantage over smaller universities. Very rarely would a large corporation want an ad deal with an athlete from a mid-major conference. Why would they when they can select from top student-athletes from ‘Blue Bloods,’ like Duke or UNC?
For athletes from smaller schools to boost their brands, they need to get creative. For these athletes, the NIL is really no different than a non-athlete looking to become a social media personality. These athletes from smaller schools have the responsibility of building their brands to profit from them. In other words, they still have to put in work to profit from their own likeness.
When you also consider that the NCAA makes as much money as it does on an annual basis, it makes the situation seem even more unfair for small school student-athletes.
It becomes more difficult for smaller school athletes when some athletes have name recognition that helps their branding. If you look at the 10 highest paid athletes from NIL, the top two spots are Bronny James, son of NBA star LeBron James, and Shadeur Sanders, son of former NFL star Deion Sanders. So, these athletes are at an even greater advantage.
Some may argue that NIL actually benefits smaller school athletes in certain situations, and it does. For Cinderella Stories, for example, these athletes get a financial opportunity that would not be available to them otherwise. It can also benefit athletes from less popular sports. For example, Livvy Dunne is a gymnast from LSU. College gymnastics is definitely not as popular as college basketball or football, but Dunne has still managed to be one of the highest earners college sports. (However, LSU is not a small school by any means.)
Despire these positives, the NIL is still unfair to smaller-school athletes. It places the responsibility on the students to benefit from their own athletic efforts. This is all while the NCAA makes millions annually off these efforts.
This Really Hurts Small Schools
With this being the case, it is nearly impossible for smaller programs to build themselves. As such, powerhouses in each sport will inevitably remain on top. In other words, college sports are slowly becoming pay-to-play. This impacts the ability of small schools to keep their doors open to students.
Over the last decade, college closings have quadrupled, while top-tier institutions continue to thrive. Not all schools can provide the academic prestige that an Ivy League can, but they can offer top-tier athletic programs. Having a successful athletics department can do wonders for a school financially. It can incentivize top high school recruits to attend the school, which only further improves the program. It can also encourage non-athletes to attend the school to be a part of the school fanbase, ultimately increasing the school’s revenue. Also, athletic success could also lead to alumni donations due to increased school pride as a result of that success.
However, with larger schools having an advantage, it’s almost impossible for smaller schools to survive, let alone grow and thrive.
How This Hurts Fans
Unless you are a fan of a Blue Blood or a Powerhouse, this likely hurts you. Fans and alumni of smaller schools also suffer with the current system in place. Whenever a smaller program begins to look promising and show signs of potential, larger programs rip the heart out of the program, scavenging all of its talent.
Not only that, this is likely to impact in-game play for years moving forward. With powerhouses always remaining on top and only getting better talent, parity in college sports will never happen. The disparity between the top-tier programs and others will only widen. Cinderella stories, or underdog stories, will only be anomalies or one-offs from now on.
Real-Life Example
At this point, I want to take a look at 2022’s biggest Cinderella Story: the Saint Peter’s Peacocks. The Jersey City school’s miraculous March run was not only unprecedented, but it touches on everything I’ve discussed up to this point.
On March 17, 2022, history happened. In the first round of March Madness, the MAAC conference winner Saint Peter’s University took on college basketball powerhouse University of Kentucky. Against all the odds, the Peacocks would shock the world defeating the Kentucky Wildcats in one of the biggest upsets in college basketball history. Kentucky, a 2-seed, was an 18-point favorite over the 15-seed Peacocks. While this might not have been the greatest upset by betting odds or point margin, it definitely was the greatest upset ever financially.
Kentucky spent $18.3 million on basketball, while Saint Peter’s spent only $1.6 million. In other words, Kentucky spent 11.7 times the Peacocks that year. To really drive this home, Kentucky head coach John Calipari makes roughly $9 million a year, which is 30 times greater than Peacocks coach Shaheen Holloway’s salary of $200,000 at the time.
It was a true David vs. Goliath story. But, that was only the beginning. Saint Peter’s would go on to defeat 7-seeded Murray St. and 3-seeded Purdue to become the first 15-seed to make the Elite Eight. It was truly the Cinderella Story of Cinderella Stories. A school that played in a gym that resembled one from your local high school somehow finished as a top 25 program in the country.
With the Peacocks becoming household names, surely the university’s basketball program would flourish, right? Well… not exactly.
The Great Exodus
College sports fans thought this was the beginning of great things for the Saint Peter’s basketball program. The entire roster that made this incredible run had eligibility to return to Saint Peter’s and run it back. Not only that, many had multiple years of eligibility remaining. So, maybe the Peacocks had a chance of even returning to the Big Dance again.
Well, a year removed from this run, it proved not to be the case, as the Peacocks didn’t dance in March. Instead, the Saint Peter’s basketball team had many new faces, as almost the entire roster left the program.
In addition to coach Shaheen Holloway, 8 of 12 players on the roster transferred to different schools. As mentioned earlier, the players used Saint Peter’s as a stepping stone to other programs as a result of their unprecedented run.
After seeing its coach and key pieces leave in just a few months, Saint Peter’s is in a much different spot than it expected. Everything that put it on the map in March 2022 is gone, and it’s the NCAA’s fault.
Small Schools Don’t Stand a Chance
Some may say that I’m being ridiculous to complain about the Peacock’s current situation. The school just went on a run that most major programs would dream of. Not only that, the school still did benefit financially, seeing jumps in enrollment, applications, and merchandise sales. (This is called the ‘Flutie Effect,’ which is when a small school upset increases awareness and attention.)
However, in a way, it’s still bittersweet to me. While I don’t expect a school like Saint Peter’s to ever be on the level of Duke, I do think that they should have the opportunity to build a successful, long-lasting basketball program. And, as the NCAA stands now, that is nearly impossible for a school of Saint Peter’s size to do.
Currently, the NCAA has created a widening disparity between large and small collegiate athletic programs. Larger schools can pay their athletes. Smaller-school athletes are incentivized to use their schools as stepping stones.
Not only that, but even Cinderella runs prove not to be that beneficial to the participating schools. While there clearly are substantial benefits to the programs off a Cinderella run, research finds that they are not long-lasting. In several studies, it appears that the uptick in application and enrollment for these Cinderella schools lasts only two years. So, pointing to the enrollment numbers today as a long-lasting impact may not be accurate.
The Solution to the NCAA’s Money Problem
Don’t get me wrong; the introduction of NIL is definitely an improvement over the former model of student-athletes not being paid. However, this doesn’t address the entirety of the problem. While there are many obstacles to finding a solution, this doesn’t mean that the NCAA shouldn’t try. Thankfully, some schools are taking the initiative.
In October 2023, several Division I conferences joined forces to lobby for Federal NIL regulation. In doing so, these sports conferences are looking to promote competitive equity amongst all schools. But, this is only a start.
NCAA could look to other means to solve the situation, like revenue sharing or creating educational trusts to fund future education expenses for students after their athletic careers. Doing so would at least ensure student-athletes get their fair share.