College football has a money problem

Combine that with the expanded playoff system and ever-growing media contracts, and you have a market feedback loop. More money drives bigger expectations, which drives more investment, which demands even more returns. At NIL’s inception over the summer of 2021, many around the game prognosticated a financial arms race threatening to hollow out institutions without resources to keep up, tilting the playing field heavily in favor of big, wealthy programs. The early returns have been mixed, though. There seems to be more parity in the sport than in the decades past. No longer can powerhouse programs like the Alabama Crimson Tide stash tiers of NFL-quality recruits on the bench for the students’ freshman and sophomore years, when players can transfer to middle-tier programs, play right away, and make an NIL return while doing it. NIL didn’t just give athletes a cut of the pie. It baked them into the pie, a dish they were formerly excluded from, as programs, conferences, and television networks reaped all the profit from their play. NIL aside, those who watch the sport closely know the eye-test proved Notre Dame is a top-five program in the country this season, despite their two early-season losses by a combined four points to two top-10 teams in the country (Miami and Texas A&M). Business and politics favoured a three-loss Alabama team for the final at-large playoff spot. This is a tragedy that tarnishes this season’s playoff, as a legitimate contender will not be in the field. When civic goods become business goods But going forward, there was one more bombshell development this past week that will fundamentally change the sport. The University of Utah became the first college to formalize a partnership with a private-equity firm. The school announced the creation of a for-profit company, Utah Brands & Entertainment LLC, backed by investment from Otro Capital. The arrangement is expected to inject nine-figure capital, in excess of$500 million USD, into the school’s athletic operations. Under the deal, Utah Brands & Entertainment will manage ticket sales, media, sponsorships, licensing, concessions, and other revenue streams previously tied directly to the athletic department. While university officials insist the school retains majority ownership and decision-making control, the shift represents a dramatic rethinking of how a collegiate athletic program operates, more like a corporate entertainment brand than a campus department. On the surface, this seems like a smart adaptation to the new realities of NIL, revenue sharing, and mounting costs for athlete pay, scholarships, facilities, compliance, and media production. But critics warn that this is the turning point; once athletic departments become financial assets to be monetized, everything changes. These teams that are civic goods in many states without NFL football are now becoming business goods. Non-revenue sports (women’s programs, Olympic sports, smaller-team sports) may get deprioritized. Schools might chase profitability over integrity, prioritizing commercial potential over education, community, or athlete welfare. Advocates will contend this just formalizes what has already happened. Football has long been prioritized and commercialized at many schools across the U.S. In many ways, they have been operating as a behemoth business enterprise, apart from the broader higher education institution, for decades. This move just brings the business above the table instead of continuing to operate beneath it. As former Louisiana State University head coach Ed Orgeron recently quipped on a podcast, the only change with NIL is that now teams no longer need to walk through the back door to deliver a player his money; they can walk through the front door. It’s all out in the open. The playoff snub of Notre Dame, the NIL arms race, and Utah’s private equity deal taken together paint a clear portrait of college football’s new era. This is a sport drowning in money, and that is creating as many opportunities as it does challenges. Time will tell if this wild-west era will allow new market forces to level the playing field or stratify it, but the trade-offs are starting to become clear. Players are rightfully being compensated for their name, image, and likeness, but television deals and personal biases are trumping merit in relation to who gets a crack at the college football playoff. In growing the pie, college football must ensure the ingredients that make the sport so special—merit, pageantry, and community—don’t get muted as cash and private equity get poured into the mixing bowl.