House Didn’t Fix College Sports. It Built a Runaway Train

OPENING STATEMENTS

College sports thought it had bought itself peace. But less than a year after the House settlement introduced a spending cap and a new College Sports Commission (CSC) to police it, the framework is already on trial. And various signs this week seem to show that the problem is the structure itself, creating a runaway train that isn’t nearly finished reshaping college athletics. 

And let’s be clear, the issue at hand isn’t compensating players, or even their mobility - especially in the wake of another Will Wade move.

House was pitched as the compromise that would stabilize the system. Schools could pay athletes directly, while third-party NIL deals could continue, provided they reflected legitimate business activity rather than disguised pay-for-play. The CSC was created to enforce that line. Using Deloitte’s NIL Go system, it reviews deals, flags associated entities like collectives and marketing partners, and is meant to prevent schools from routing extra compensation through back channels.

What the designers didn’t take into account, however, were, well, themselves. The coaches and administrators for whom on-field success is the objective. Thus, implementation of the settlement has functioned more like a soft cap than a hard one. The richest programs are already chasing the true market cost of winning - which, in football, may reach $40-50 million in the fall.

A series of developments this week suggests the system is already straining, in part, because the system is running up against the student-athletes at the center of the issue and who had zero say in its design.

Nebraska’s pending arbitration is the first major test. Eighteen football players, backed by the school, are challenging CSC’s rejection of NIL deals funded through Playfly Sports, the university’s multimedia rights partner. Nebraska even amended its Playfly agreement to redirect funds that once went to the athletic department toward athlete NIL compensation that would not count against the cap. Athletics directors are suggesting the case may be a litmus test. If Nebraska prevails, it may signal that CSC lacks the authority to enforce the cap, opening the door for widespread use of similar workarounds. If CSC wins, programs that have already promised significant money through comparable structures may be forced to backtrack, or get more creative.

At the other end of the spectrum, a $5,000 NIL dispute tied to Georgia is being framed as potentially system-shaping. That a seemingly minor case carries that weight underscores how unsettled the rules remain. The same questions apply at every level: Who bears the risk when a deal falls apart? What distinguishes a legitimate endorsement from pay-for-play when all parties understand the underlying purpose?

These smaller disputes are where the system becomes real, especially for athletes outside the top tier who still sign binding contracts but lack leverage.

All of this is unfolding against a backdrop of rapidly escalating spending. What was recently considered a $20 million championship roster is now giving way suggestions that $25 million may soon be a competitive baseline. Meanwhile, CSC data indicates that a large majority of NIL deals submitted this winter came from entities tied to roster-building efforts rather than traditional sponsorships, prompting its own leadership to acknowledge the system wasn’t built for this volume of “associated” deals.

At the same time, the cap applies uniformly across vastly different sports and revenue models, reinforcing the perception that it is both too restrictive for the top tier and too disconnected from economic reality overall.

Overlaying this is a political process that reflects the uncertainty more than it resolves it. President Trump’s roundtable earlier this month lacked any serious input or consideration from student-athletes. Congressional hearings this week have better emphasized athlete welfare, but parties remain divided on fundamental issues like employment status, antitrust protection, and the interaction between federal standards and state NIL laws. As we talked about last week, conference leaders have begun openly contemplating a future where they set their own rules, less a solution than a signal that national governance is weakening.

Taken together, these developments point to a larger truth: House did not create a stable system. It created a cease-fire. The current framework rests on unresolved contradictions—a soft cap in a hard market, a national regulator with limited authority, and a one-size-fits-all model applied to wildly different economic realities. The cases now emerging won’t just refine the system; they will determine whether it can evolve into something coherent or be litigated apart.

EXHIBIT A

Is Alabama losing Kristy Curry to South Florida a case study in the new women’s basketball, if not college sports, economy? Alabama ranked at the bottom of its league in women’s basketball spending among public schools. At USF, she walks into a program with recent titles and NCAA trips, and the realistic chance to sit near the top of her league’s investment table. In a stratified, revenue‑sharing era, coaches in some sports may increasingly decide it’s better to be Gonzaga than a budget version of a power‑conference blueblood, building a winner where the school’s ambition and the balance sheet actually match.

EXHIBIT B

In another unintended way that college sports is mimicking professional counterparts pro sports, we’re seeing management and players at odds before independent arbitrators. In major league baseball, it’s money. In college, it’s now eligibility. In Charles Bediako’s case, SEC commissioner Greg Sankey filed an affidavit urging a judge to keep one of his own league’s players off the floor, all in the name of “integrity” and “order.” Now ACC commissioner Jim Phillips has done the same thing to Virginia quarterback Chandler Morris, asking a Virginia court to deny him a seventh year and affirm NCAA limits. College leaders can say this isn’t professionalized all they want, but when commissioners are effectively testifying against their own athletes, it sure looks like management versus labor.

ON THE DOCKET

Next week’s Division I Cabinet meetings on blind transfers looks like another reminder that the NCAA is still rearranging deck chairs instead of fixing the ship. The proposal would hammer schools that take a player who wasn’t in the portal window with head-coach suspensions and fines. On paper, it is about process and integrity; in reality, it tightens labor restraints in a revenue‑sharing marketplace that already sits under an antitrust microscope. As we’ve written before, when you keep regulating at the margins and refuse to confront the basic employment model, you don’t reduce litigation risk, you invite the next wave of lawsuits.

FOOTNOTES

$776,000

The annual gift from Reddit founder and Virginia alumnus Alexis Ohanian to support the women’s basketball program, which was the first to emerge from the First Four to the Sweet 16