How Does New NCAA Multi-Billion Dollar Settlement Affect Texas Longhorns?

Texas Longhorns Athletics will be allowed to directly pay student-athletes as early as Fall 2025 after conferences agreed on settlement.

Texas Longhorns wide receivers Adonai Mitchell (5) and Xavier Worthy (1) celebrate a touchdown by Mitchell during the Big 12 Championship game against the Oklahoma State Cowboys at AT&T stadium on Saturday, Dec. 2, 2023 in Arlington. / Aaron E. Martinez / USA TODAY NETWORK

According to reports, the NCAA and Power 5 conferences agreed on a multi-billion dollar settlement allowing schools to pay players directly on Thursday, in a historic day for college athletics. The decision is a step forward from the Name, Image, and Likeliness activities permitted by Texas law on July 1, 2021.

For most of college athletics history, student-athletes were not able to receive any compensation for their work. With the introduction of NIL, they were allowed to receive payments from businesses that used the student-athletes NIL to promote their products or services, promote their own business or one they are employed by, receive compensation for autograph sessions or private event appearances, and utilize an agent to assist with NIL specific activities.

Football players make up the first 59 in the On3 Top Texas NIL Players list, with quarterbacks Arch Manning and Quinn Ewers sitting on top with a $2.4 and $1.9 million valuation. Former Texas basketball player Max Abmas broke the streak at number 60.

However, from 2016 to the present day, approximately 14,000 claims against the NCAA and the unpaid usage of a student-athlete's NIL were made. Under the settlement, $2.77 million in damages will be paid under 10 years, per AP News.

Starting as early as Fall 2025, Texas will be able to commit up to $21 million to be directly paid to student-athletes through a revenue-sharing system. The financial commitment is not required but could be a deal breaker in the recruiting process.

The settlement will be a step into a more professional model for college athletics, and could likely switch from the NCAA's current scholarship regulations to the use of roster size as a determining factor for how many athletes each sport can have.

The plan is awaiting final approval from plaintiffs and a federal judge.