Collegiate sports revenue re-evaluated
A recent federal court ruling has reignited a long-standing debate about whether athletes in high-revenue college sports — including those at UNC — should be paid.
In 2009, former UCLA basketball star Ed O’Bannon filed a lawsuit against the NCAA for using his likeness and name in various products — without giving him a cut of the profits.
The NCAA recently filed a motion that would have excluded current athletes from the case.
But the judge struck the motion down last week.
“If the case goes forward, former and current men’s football and basketball players will be part of the class,” said Richard Southall, director of the UNC College Sport Research Institute.
The NCAA uses its profits for running corporate offices and championships for Division I, II and III schools, said Barbara Osborne, a UNC sports law professor.
At the end of the fiscal year, the NCAA distributes extra revenue to universities, she said.
Southall said the college sports industry generates a gross annual revenue of about $6 to $10 billion.
The question raised by the case is whether current and former athletes have a right to a cut of these profits.
Southall and his colleagues split college athletes into two categories — profit and expenditure athletes.
Profit athletes have a market value that exceeds their grant and financial aid, while expenditure athletes have a market value that is lower.
At Ohio State University, expenditure athletes have a median annual family income of $500,000 and are primarily white, Southall said. Profit athletes who play sports like basketball and football are generally lower-to-middle class and African American, he added.
Southall said the case highlights issues of socioeconomic status and the exploitation of profit athletes.
“Are we comfortable as a society having one group of athletes making most of the money for the rest of the athletes?” he said.
In the wake of the UNC football scandal, Southall said he questions whether institutions are treating their profit athletes more like employees rather than students.
In the 2009-10 school year, SEC football players would have earned a total of $62 million from conference revenues — about $5.12 million per team — if they were legally entitled to a share of broadcast profits.
Men’s basketball players would have earned a total of about $3.5 million per team.
The Knight Commission on Intercollegiate Athletics, an organization that advocates for academic and fiscal integrity for athletic programs, has not taken a stance on the case, but is fully committed to ensuring athletes are treated fairly, said Amy Perko, executive director of the commission.
The judge will determine if the case can proceed as a class-action lawsuit on June 20.
Osborne said college sports will likely not face a change in revenue distribution anytime soon.
“No matter who wins this lawsuit, it will be appealed,” she said. “And if the plaintiff loses then, of course, nothing changes.”
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