College Sports Enters a New Era with Groundbreaking Revenue-Sharing Settlement

College athletics just experienced its most seismic shift in over a century. On Friday, a federal judge approved a historic, multibillion-dollar settlement that allows Division I schools to begin sharing revenue directly with student-athletes starting July 1, effectively ending the NCAA’s long-standing amateurism model.

This landmark agreement stems from a five-year legal battle led by former Arizona State swimmer Grant House and other athletes who sought compensation for lost earnings prior to NIL (name, image, and likeness) rights. Now finalized, the settlement lays the groundwork for a new, semi-professional structure in college sports:

• $20.5 million salary cap per school: Schools can now allocate up to $20.5 million annually to pay athletes, though how funds are distributed across sports is up to each institution.

• $2.8 billion in back pay: Athletes from the pre-NIL era will receive compensation for past lost revenue opportunities over the next decade.

• Roster limits replace scholarship limits: In a major shift, schools will have strict roster caps, squeezing out walk-ons and changing how teams are built.

While the deal answers many questions, it introduces new ones. Will the payments be split equally between male and female athletes? Will Olympic sports survive funding reallocation? And how will schools handle competing state NIL laws?

The NCAA, meanwhile, loses significant control as power shifts to the big-money conferences — the SEC, Big Ten, ACC, and Big 12 — especially in football. Enforcement will now fall largely to third-party auditors like Deloitte.

Though this is a major win for high-profile athletes and player compensation advocates, many fear the impact on non-revenue sports and walk-ons. Still, NCAA President Charlie Baker calls it a “new beginning,” even as he continues to push for federal legislation to unify college athletics under one rulebook and offer antitrust protection.

The bottom line: The amateur model is all but gone. College sports just went pro — and the ripple effects are only beginning.