The transition from NIL to revenue sharing

[CHROMEBIRD]

Not to sully our fair and genteel discussion forum with b*sketball content, but an interesting thing is happening with bball recruiting & revenue sharing and it made me wonder if it had any downstream effect on wrestling. 

Previously, elite recruits could maximize their earning potential (at least in theory) by dragging out their commitment, building hype around their decision, and letting teams get into a bidding war for their services. But these days, kids who hold off on their recruitment for too long risk getting passed over when the transfer portal opens. A lot of coaches will hedge their roster-building with proven, experienced transfers over high schoolers who have zero college experience.

So, more top recruits may be willing to sign earlier now. The problem? Coaches & ADs don't have a clear idea of what their recruiting budget is (in many cases, programs won't totally know how much money they have to play with until after football season is over), and elite high school players are expecting a lot more than what schools are willing to offer at the moment. Plus, agents believe players should still be getting big paychecks like in the gravy train days before the House settlement. Classic wage-labor gap.

One coach predicts that programs may have to over-promise kids money and then figure things out if they find out later that they can't scrape together the dough. Like a recruit may be an early commit based on a $1mil offer and then a coach comes back in the spring like, "sorry, I just found out my salary cap and can only give you $250k max."

So does this affect wrestling at all? I don't know, this is all new and maybe the college sports market needs a little time to settle on its equilibrium. But if I'm a hs wrestler or coach, I'd probably advise my wrestlers to jump on any good offer they receive and sign as soon as possible. In the above scenario, where a bball or football coach is needing more money than they are allotted to sign a superstar recruit, it's not hard to imagine an AD being persuaded to reallocate cash from wrestling or other non-revenue sports to basketball or football. I say sign a contract and secure the money while it's there.

OTOH, I'm not sure if top wrestling recruits will feel as squeezed by the portal as basketball and football players. A lot of the top hs wrestlers are already in college wrestling rooms, competing internationally, and beating Senior level guys, so college coaches have a pretty good idea of exactly what they're getting. 

Either way, I do not envy coaches and programs having to sort this all out.

https://www.cbssports.com/college-basketball/news/college-basketball-commitments-plummet-amid-big-changes-in-recruiting-nobody-knows-what-to-do-right-now/

[bnwtwg]

If a football player is squeezed 75% below promise, then every olympic sport will be affected. Every AD will prioritize all salary cap toward revenue sports (Dodgers) and every olympic sport (Marlins, A's) will be a bottom feeder annually facing the chopping block. At least University of Kentucky was transparent when their government-employee athletic department transitioned to a private LLC business.

 

https://ukathletics.com/news/2025/04/24/new-model-represents-innovative-approach-to-future-of-college-athletics/
 

https://swimswam.com/the-legal-implications-of-the-privatization-of-kentuckys-athletics-department/

[CHROMEBIRD]

16 hours ago, bnwtwg said:

If a football player is squeezed 75% below promise, then every olympic sport will be affected. Every AD will prioritize all salary cap toward revenue sports (Dodgers) and every olympic sport (Marlins, A's) will be a bottom feeder annually facing the chopping block. At least University of Kentucky was transparent when their government-employee athletic department transitioned to a private LLC business.

 

https://ukathletics.com/news/2025/04/24/new-model-represents-innovative-approach-to-future-of-college-athletics/
 

https://swimswam.com/the-legal-implications-of-the-privatization-of-kentuckys-athletics-department/

I can 100% see ADs shifting athletic funds to football if there's ever a deficit (although it's literally the job of GMs to manage exactly that). MBB is a distant #2 in funding, but I could see programs granting basketball coaches additional budget if they needed it, with the March Madness expansion to 76 cash grab and all.

An eye-catching tidbit from the earlier article: "The befuddlement stems from the overwhelming majority of power-conference schools not going north of $4 million (and plenty not exceeding $3 million) [for men's basketball] in revenue sharing. Ergo, theoretically, no team with a projected budget under $5 million should be offering almost any freshman close to $2 million." which is interesting since Bruce Pearl, I think it was, mentioned last season that a player said he'd hop in the portal and transfer if he was offered a $5mil deal. I think the highest valuation (not actual NIL) was Lebron's kid at around $6mil. Just a crazy gap. 

Back to wrestling: if we take the $3-4mil mbb figure from the article and average it to $3.5mil, that already puts P4 programs above a 15-16% share of the $20.5mil cap. Dunno how credible this revenue sharing website is (it looks like it was compiled by some CPA in DC?), but it looks like wrestling is on the higher end, if you could even call it that, of non-revenue sports at 0.6% of programs' budget, or around $127k/yr. That's not a lot of revenue being shared to wrestling, and that number will likely be smaller if football, basketball, hockey, and baseball grab a bigger than expected piece of the pie.  

This doesn't include true NIL deals of course, but $127k allocated to the entire team is pretty far off from some the wild numbers we hear about individual wrestlers being offered.

[fishbane]

On 10/10/2025 at 1:55 PM, CHROMEBIRD said:

An eye-catching tidbit from the earlier article: "The befuddlement stems from the overwhelming majority of power-conference schools not going north of $4 million (and plenty not exceeding $3 million) [for men's basketball] in revenue sharing. Ergo, theoretically, no team with a projected budget under $5 million should be offering almost any freshman close to $2 million." which is interesting since Bruce Pearl, I think it was, mentioned last season that a player said he'd hop in the portal and transfer if he was offered a $5mil deal. I think the highest valuation (not actual NIL) was Lebron's kid at around $6mil. Just a crazy gap. 

It's not difficult to understand the standoff if this is the case.  With a revenue sharing limit of $5M on the high end this means that budget for paying players is less than the salary of the head coach almost everywhere.  I guess that is more in line with what it should be when it was just a scholarship, but way out of sorts with any professional league.  The revenue share % is scheduled to increase over time under the house settlement so maybe it eventually reaches something reasonable.

[CHROMEBIRD]

6 hours ago, fishbane said:

It's not difficult to understand the standoff if this is the case.  With a revenue sharing limit of $5M on the high end this means that budget for paying players is less than the salary of the head coach almost everywhere.  I guess that is more in line with what it should be when it was just a scholarship, but way out of sorts with any professional league.  The revenue share % is scheduled to increase over time under the house settlement so maybe it eventually reaches something reasonable.

Good point, although who knows with the Big Ten scoring a $2bil investment deal last week. I'm sure the other power conferences will follow. 

I assume the $5mil budget might be for non-football schools and maybe very blue-blooded bball programs like Duke, UK, and UConn where ADs would actually allocate a little more money away from football. A $3mil ceiling is probably closer to reality for most schools. Although the NCAA is essentially a pro league, it's still a dev system for the NBA, NFL, MLB, etc. so a fairer comparison in this case might be the G League (avg salary < $50k) or what lesser players in the EuroLeague make ($300k-$800k in USD). Feels like the college market is still figuring itself out.

[PSULou64]

I couldn't discern if they are talking revenue sharing or profit sharing?  I imagine those numbers would be drastically different when you account for what it costs to run these programs before you even factor in paying athletes.  I'm not opposed to profit sharing but even still this didn't address the idea of how to keep parity.  I think that capping each sport will be the only way to deal with that part of the issue.

[ionel]

1 hour ago, PSULou64 said:

I couldn't discern if they are talking revenue sharing or profit sharing?  I imagine those numbers would be drastically different when you account for what it costs to run these programs before you even factor in paying athletes.  I'm not opposed to profit sharing but even still this didn't address the idea of how to keep parity.  I think that capping each sport will be the only way to deal with that part of the issue.

ahh ... public universities dont make a profit correct?  Betting revenue sharing.  

[fishbane]

3 hours ago, PSULou64 said:

I couldn't discern if they are talking revenue sharing or profit sharing?  I imagine those numbers would be drastically different when you account for what it costs to run these programs before you even factor in paying athletes.  I'm not opposed to profit sharing but even still this didn't address the idea of how to keep parity.  I think that capping each sport will be the only way to deal with that part of the issue.

It wouldn't make sense for non-profit universities to have a profit sharing plan with the athletes.  

The issue being pointed out in this post is essentially that the salary cap is too low for the schools to pay the athletes their free market value.  The revenue share cap is $20.5MM which is calculated based on 22% of the average revenue of the power 5 schools, but not all revenue is counted.  Booster contributions are not.  

The NFL which does as good a job with parity as any major pro league in North America splits revenue 52/48 with the players not 22/78.  They also attempt to fully monetize their superfans by selling them expensive multi year contracts for luxury boxes and courtside seats, rather than gifts that don't count as revenue.

22% should allow any power 5 team to pay and is far less than what the average power 5 team should be able to afford.  If it was closer to 50/50 then you'd see some teams on the low end not being able to meet it and a revenue share between teams like many pro league use might be necessary.  

You have PSU paying James Franklin $8M to not coach.  They will have to pay his replacement a similar sum and adding on assistants their budget for football coach salaries is going to be about $20M/year until Franklin takes another gig or 2031.  Their cap for football player salaries is $15-16M.  These power 5 football programs can pay players more than that.  The money is there they have just been spending it in other ways.

[fishbane]

16 hours ago, CHROMEBIRD said:

Good point, although who knows with the Big Ten scoring a $2bil investment deal last week. I'm sure the other power conferences will follow. 

I assume the $5mil budget might be for non-football schools and maybe very blue-blooded bball programs like Duke, UK, and UConn where ADs would actually allocate a little more money away from football. A $3mil ceiling is probably closer to reality for most schools. Although the NCAA is essentially a pro league, it's still a dev system for the NBA, NFL, MLB, etc. so a fairer comparison in this case might be the G League (avg salary < $50k) or what lesser players in the EuroLeague make ($300k-$800k in USD). Feels like the college market is still figuring itself out.

I would think that non-football schools could be at a significant advantage here.  They should have the same $20.5M cap as any other school and could spend it all on basketball.  It is unlikely that a non-football school would have the revenue to max it out, but they could more creatively use their athletic budget since player salaries wouldn't be constrained by football.  On the high end you have Kansas paying Bill Self $8M+ and with the rest of his staff that $10M+ in coach salaries, but can only pay players $4M.  If a non-football school could get half that budget they could spend $1.5M on coaches and $5.5M on players and outbid essentially all FBS schools on the top recruits.  

The thing with NBA G league, EuroLeague, minor league baseball, minor league hockey, CFL ect. is that the coaches get developmental/minor league money too.  I seriously doubt any coach/manager in any of those leagues out earns his entire roster.  The top NCAA basketball and football coaches would be in the top 10 coaches' salaries in the NBA and NFL.  Last year 45 D1 basketball coaches made over $3M.  It's a way better gig than coaching in the G League.

[fishbane]

On 10/10/2025 at 1:55 PM, CHROMEBIRD said:

I can 100% see ADs shifting athletic funds to football if there's ever a deficit (although it's literally the job of GMs to manage exactly that). MBB is a distant #2 in funding, but I could see programs granting basketball coaches additional budget if they needed it, with the March Madness expansion to 76 cash grab and all.

An eye-catching tidbit from the earlier article: "The befuddlement stems from the overwhelming majority of power-conference schools not going north of $4 million (and plenty not exceeding $3 million) [for men's basketball] in revenue sharing. Ergo, theoretically, no team with a projected budget under $5 million should be offering almost any freshman close to $2 million." which is interesting since Bruce Pearl, I think it was, mentioned last season that a player said he'd hop in the portal and transfer if he was offered a $5mil deal. I think the highest valuation (not actual NIL) was Lebron's kid at around $6mil. Just a crazy gap. 

Back to wrestling: if we take the $3-4mil mbb figure from the article and average it to $3.5mil, that already puts P4 programs above a 15-16% share of the $20.5mil cap. Dunno how credible this revenue sharing website is (it looks like it was compiled by some CPA in DC?), but it looks like wrestling is on the higher end, if you could even call it that, of non-revenue sports at 0.6% of programs' budget, or around $127k/yr. That's not a lot of revenue being shared to wrestling, and that number will likely be smaller if football, basketball, hockey, and baseball grab a bigger than expected piece of the pie.  

This doesn't include true NIL deals of course, but $127k allocated to the entire team is pretty far off from some the wild numbers we hear about individual wrestlers being offered.

$127k is not nothing compared to pre NIL.  That is an extra 1-4 scholarships depending on the school.  My understanding is that any scholarship awards in excess of the pre-House limit would count towards the revenue share limit.  So instead of 9.9 scholarships a team could award another $127k in scholarship money.