VICE (2013) s05e06 Episode Script
End of Amateurism
1 (theme music playing) Shane Smith: This week on "Vice," the ongoing battle over the billions of dollars earned in college sports.
Kirby Hocutt: They're going to school for free.
We're meeting all of their needs.
You might make a lot of money if you get into the pros, and yet, less than one percent of the people make it.
Each round, each pick that goes by means less money for him if he eventually gets picked.
Do you think you would have left college early if you had been, in some way, compensated throughout college? No, honestly.
Go, go, go! Refugee: We are not animals! The cost for broadcast rights to air the games of professional sports has soared over the last 10 years, generating billions upon billions of dollars for their respective leagues.
Pro-athletes have had a share in these rising profits.
However, college athletes haven't.
Now next week, college basketball's biggest draw, the NCAA Final Four, comes to a close.
A single 30-second ad during this event costs more than a million dollars.
In fact, the NCAA will make around a billion dollars this year, but the NCAA forbids any kind of compensation for college players beyond the cost of their college education.
Now many see this as exploitation and unfair, given that most college athletes won't make it to the pros.
Gianna Toboni spent a year following both sides of this growing debate.
(distant applause, cheering) (crowd cheering) Go! Toboni: College sports have become so popular that the five biggest conferences made more than $6 billion last year alone.
With so much money being made off of games played by college kids, we wanted to understand the demands of being a student athlete.
So, we caught up with Michigan State's basketball team as they flew on a privately chartered jet.
Do most people see it as a full-time job? Toboni: And what they want it to add up to is the next step, the pros.
Toboni: While that dream is common, Hall of Fame coach, Tom Izzo explained to us how rare achieving it actually is.
(laughs) Toboni: Yeah.
(Tom Izzo continues) Toboni: While the vast majority of these players never make it to the pros, the NCAA identifies them as amateurs, strictly forbidding them from profiting off of not just their ability, but their name, image and likeness.
This led to a now infamous case, brought by former player, Ed O'Bannon, who sued the NCAA for profiting off of his likeness over a decade after he left school.
Close to 15 years later uh, and they're still making money off of-- off of my image.
Toboni: The federal court system decided that the NCAA's amateurism rules were an unlawful restraint of trade, but the ruling did not call for schools to pay the players directly.
Some players think they're being ripped off, and a new lawsuit is directly challenging the NCAA's model.
O'Bannon and other cases have targeted certain elements of the NCAA's business model.
Your case would fundamentally change college sports.
We hope it will fundamentally change college sports.
Toboni: Jeffrey Kessler changed the NBA and NFL after pursuing groundbreaking litigation that freed up players to bargain for much higher salaries as free agents.
What these players want is fair treatment.
That's all that they've ever been seeking.
The players will get their day in court.
Toboni: And now Kessler has trained his sights on the NCAA.
These athletes, they don't get paid, but everybody else does.
It's not fair, and it's not legal.
What we're trying to do is empower the schools and the conferences to make their own choices about what's fair for the players.
That's all.
Very simple.
This is a freedom of choice case.
Toboni: Former Clemson cornerback, Martin Jenkins is leading the charge in this new case.
While playing for a sports program that brought in more than $70 million in revenue a year, he was not allowed to profit.
Announcer: Jenkins to the 10, and he scores! Why did you join this lawsuit? I don't want to see college athletes struggle when the school that they're working for, technically, is making hundreds of millions of dollars off of them.
Did you expect to make it to the NFL? Absolutely, absolutely.
What happened when you graduated college? Jenkins: I had four surgeries in college.
Tore my labrum, had surgery on that.
Tore my groin, had surgery on that.
I tore a ligament in my foot, had surgery on that, and I tore a ligament in my thumb, had surgery on that.
When I graduated, I initially went to a training camp, went to rookie camp with the-- the New York Jets.
Same kinda thing persisted, had some injuries.
So after giving it a couple tries, I said, "You know, it's-- it's kinda time to hang it up.
" You spent years, uh, playing football and suffering injuries, and you couldn't profit off of your athletic ability during those years.
Mm-hmm.
Mm-hmm.
You graduated, and it was injuries that, in part, took you out of the game.
Do you think that your prime earning years were when you were in college? Yeah, I can actually agree with that.
Yes.
The case that-- that you guys are bringing could really change the future of college sports.
In a very strong, positive way.
If the schools are allowed to decide how to compensate these players, we believe they'll do the right thing and the fair thing.
So schools wouldn't be required to pay athletes, they'd be allowed to? That's right.
That's something that the market would decide.
Just like the market for anybody else in entertainment, or anybody else in sports, or anybody else who has a job.
You let the employers decide what's the fair competition, and then the marketplace reaches a decision on that.
The money is there.
Toboni: That same approach was applied to free agency in pro sports.
Just as that market was ballooning as new broadcasting, and licensing deals added billions to bottom lines.
But introducing a free market in college sports, could spark even more dramatic effects.
We wanted to understand both sides of this debate, but the NCAA and 30 universities declined our request to speak on the topic.
One of the few schools willing to talk to us was Texas Tech.
Let's go! (cheering) (cheering) (grunting) It's college football season in Texas.
We're at Texas Tech, they're playing KU, and fans are going nuts.
(cheering) Toboni: Texas Tech is expected to generate $80 million in revenue this year alone, but as Athletic Director Kirby Hocutt showed us, the debate over player pay becomes more complicated when the cost of running a Division One athletics program is considered.
This is our football training facility.
This is the hub of Texas Tech football.
Take a peek into our team meeting room facility.
It's our team meeting room.
It gives Coach Kingsbury an opportunity to address the entire team at one time.
Toboni: I don't think I've been in a nicer corporate meeting room than-- than this one.
It serves its purpose.
Texas Tech University has invested over $200 million in the last decade into its athletic facilities.
Toboni: Hundreds of millions of dollars are invested directly into expenses like world-class facilities, and personal salaries.
But while the coaches and administrators are compensated well, what they're able to provide athletes is closely regulated.
There's always sandwiches, lunch meats, bagels.
Toboni: So, before a couple years ago, you couldn't have sandwiches, and Gatorade's and things for the student athletes.
You were limited in what type of snacks you could provide, and when you could provide those.
The NCAA's taken great steps forward.
Toboni: Does the Athletic Department turn a profit? We do.
We, uh-- we've been in a a positive financial position for the five years that I've been at Texas Tech University.
The Athletics Department in the past 15 years has invested over $300 million into our athletic facilities.
We have 415 student athletes competing in 17 sports.
They are receiving a free education, that's covering their tuition, their fees, room, books, and then board-- their living expenses.
And then on top of that, this is our second year to provide cost of attendance on top of the full scholarship.
At Texas Tech University, the full cost of attendance is an additional $4,820.
If the day comes, and there are additional payments to-- to select student athletes that are required, you have to consider elimination of opportunities.
I've been in a position before where I've had to eliminate sport programs, and I hope that I'm not in that position ever again to have to take opportunities away from young people.
Toboni: While colleges say they need this revenue to provide scholarships, programs and facilities economists like Rodney Fort see nothing but record growth and record spending.
All schools can afford to pay players.
All of them.
Fort: If my revenues and expenditures are going up at the same rate, because money that's being generated by players is being spent on coaches, and administrators and facilities, then the money to pay the players is already there.
The fact that you're not allocating the money to the players doesn't mean that you couldn't, and that's the-- you know, that's the-- the fallacy.
How has the NCAA changed over the last 30 years? The rise and impact of, um-- of television, and now video streaming, it's changed it into an activity where the conferences that can generate the most money are also in control of how it gets distributed.
The reason that amateurism exists is because it allows the university discretion over a larger portion of the amount of revenues that get generated by the Athletic Department than they would otherwise have, and that discretion comes at the expense of the athletes.
Is there something contradictory about schools making money any way they can off of college sports and then not allowing the athletes, who arguably are the ones generating the money, make a profit.
Many people wonder if this is an outright exploitation.
As an economist, I look at that and say, "Well, yes, that's exactly what they're doing.
" Toboni: But the NCAA goes farther than preventing athletes from sharing in the school's revenues.
Their 400-page rule book prohibits the athletes from making any money off of their athletic ability.
So each year, new controversies make headlines across the country.
but what many don't know is that these same rules apply to athletes before they even graduate high school.
(crowd cheering) So, we're at Under Armour's AAU Tournament, and all of these high school kids are showing off their skills for all the top college coaches that are sitting right here.
And everyone here is wearing Under Armour.
Toboni: We asked Coach Antoinette Bennett to explain how Under Armour benefits from hosting these tournaments for high school athletes.
Toboni: One of Coach Bennett's players, David Beatty, was among the top prospects of this tournament.
He explained how this branding works for the athletes.
Toboni: The reason these brands give these kids free gear is because it amounts to free advertising.
Something that became clear when we visited David's home.
Toboni: Holy shit.
(David laughs) David: Cause I've got sneakers in my mom's car, I have sneakers at my friend's house.
You can pick out any basketball shoe, and I got a story for each one.
Toboni: What about the Terminator ones on the end? (exhales) I got those for Dick's Nationals.
Played on ESPN in them for like five minutes.
Started hurting my feet, took 'em off.
(Toboni laughs) David: First time I wore 'em, last time I wore 'em.
Toboni: How much do you think it's all worth? (hums noncommittally) Probably like $10,000? Toboni: Because you're not getting paid right now, why not just sell your shoes? Help out your family? Because with the NCAA rules, it's like a violation, and they'll try to, like, investigate and do all this other crazy stuff just to, like, stop me from going to college and playing basketball.
Toboni: Even during high school, a violation of NCAA rules could cost David a chance at going to one of the many colleges which are recruiting him.
"We love you, and we care about you, and we want you.
" Toboni: And dozens of universities are offering him that exact opportunity as long as he follows the NCAA rules.
How you feel about that? I mean, it's like I got a lot of sneakers.
Like, why can't I give sneakers to other people, or why can't I help out my family? Cause, like, we need the money.
Toboni: That has David and his mother holding out hope that one day he'll be able to profit off of basketball.
I had to just start answering calls, because I'm not sure if it's a bill collector, or a college recruiter.
So I answered everybody's calls, and most of the time, it was somebody calling, saying they wanted my son.
With all this money these colleges make off these kids they should get a little something.
Toboni: But the man who designed the system behind David's sneakers, Sonny Vaccaro, never intended for the players themselves to be left out.
You paved the way for big brands like Nike to make money off of amateur athletes.
How did you do that? I was sort of an out-of-the-box guy, and when I finally got to Nike, all I did was go there with an idea.
I said, "You guys want to get involved in college basketball?" They said, "Yeah, well, how do you do that?" And I said, "Pay the coaches money for being consultants for Nike, "and we will give the shoes to the schools that they represent.
"They will put them on the feet of the athletes and you'll get exposure.
" I didn't talk to AD's.
I didn't talk to school presidents.
I talked to Jerry Tarkanian, Jimmy Valvano, Eddie Sutton, John Thompson.
I mean, I talked to the coaches, who at that time weren't making the multi-million dollar contracts.
They were working for 30,000 or 40,000.
By 1982, every college coach worth their salt was getting paid by a shoe company.
How did Nike profit off of that model? First year, we had seven or eight schools.
Year two, we had close to 80.
They profited off of it, because they-- and what the world would then see-- are the athletes, or the endorsers, sell the product.
My thought was then, is now, and has proven to be one of the greatest marketing moves in the history of anything, By the time the world woke up, we had everybody.
The system I created was beautiful.
The only thing that morphed into the reality of it all is the athletes should have walked lockstep with the universities and the coaches.
Toboni: It's not just that they haven't walked lockstep.
While players are still prohibited from profiting in any way, their coache'' salaries have skyrocketed.
82 coaches across the country make more than $2 million a year.
The University of Michigan's football coach makes $9 million a year, and at in-state rival Michigan State, the head football and basketball coaches each make more than $4 million a year.
Helping to fuel these salaries, the biggest conferences have their own TV networks that reach tens of millions of viewers on top of lucrative deals with major TV networks.
While filming Michigan State's 49-0 victory over Rutgers, we experienced firsthand the business of college sports.
The Big Ten Network told us yesterday that in order to use the footage that we film in the stadium today, we have to license it for $129 a second, minimum 30 seconds, which means that me talking to you right now is costing us at least $1,000.
Toboni: In total, we were charged more than $3,000 to show game footage we shot ourselves of one of the most lopsided games of the college football season.
But even this blowout could be indicative of the huge role money plays in college sports today.
Rutgers went 0 and 9 in a new conference this season.
Many believe they were only placed there to generate revenue.
Competitive levels have been thrown out completely, because it's all about what schools can make you the most TV dollars as a conference.
Toboni: When Rutgers and Maryland joined the conference.
The Big Ten Network expanded its regional reach, and its audience jumped from 52 million to 60 million, and then The Big Ten made three major TV deals valued at $2.
64 billion.
Michigan State's athletic director, Mark Hollis, who made more than $900,000 last year, talked to us about how these deals influence conferences.
Rutgers, Maryland, joined the Big Ten in 2014, and before that, there was no presence in that TV market in New York, New Jersey.
Of course that brought in eight million more households which means more ad revenues, right, which makes those TV deals much more lucrative.
So, are those TV deals in some ways dictating which teams are in which conferences? I think the commissioners that help guide those decisions, um, were doing so in a way to create the type of resources that we can to keep the services for our student athletes in a way that, um, are either at the level we have or even greater.
I think also what people wonder, though, is then why can't players then take advantage of that, why they can't be benefiting or why they're limited in how they benefit from these deals.
I think players are benefiting from it.
Student athletes today are, you know, provided with the opportunity to receive a lot of benefits from apparel to travel to medical, food.
You give them every-- every opportunity that you can-- academically, athletically and socially-- to be successful.
But are they really getting the opportunity to get an education? Can you guarantee a degree? No.
Can you guarantee that they're getting the right education? No.
You can give them the ingredients, and the opportunity for success.
Toboni: But many college athletes grow frustrated with the NCAA's system, and see pursuing some kind of money during their prime earning years as more beneficial than finishing their education.
Peyton Barber was a running back for Auburn, one of the top football schools in the country.
Announcer: You see Barber, he elevates.
I think that ball makes it this time.
You ever wonder, you're like out on the field, and you see all the fans and the jerseys and all the stuff being sold and do you ever wonder where that money goes? All the time.
We bring in the majority of the money for our school, $80 million to $100 million a year.
Do you see it as a job? Oh, definitely, I mean, getting up at 5:45 in the morning, going to work out.
You have practice, you have meetings all day.
I mean, your day's not really over until 8:00 or 9:00.
Toboni: After making the SEC honor roll in his sophomore season, money issues led Peyton to leave college football and take his chances in the NFL draft.
I don't know if anybody really knows my mom, she's homeless right now.
So, it's kinda-- I'm doing it for her.
At what point did you decide that you were gonna declare for the draft? We've been having, like, some family, you know, problems for a while.
When you come home, and it's like-- including me, it's like five people sleeping in one room sometimes.
That's a hard thing to see.
I just wanted to help my family out and provide for 'em.
Lori: I kinda like wanted to cry when I heard him say that.
I want Peyton to get his education.
Toboni: Do you think you would have left college early if you had been, in some way, compensated throughout college? No, honestly.
What's today? Today will be the day that I'm predicted to go in the draft, so (sighs) we'll just have to see.
Announcer 1: The NFL draft has finally arrived.
Announcer 2: With the first pick, the Los Angeles Rams select Jared Goff.
Toboni: Experts predicted Peyton would be picked in the last four rounds of the draft.
So, on the third and final day of the draft, Peyton and his friends gathered at a driving range to celebrate his new career in the NFL.
I love you, brother.
I love you too, man.
How you been? I'm good, man.
I've been good.
Just waiting? Yeah.
Peyton: Hopefully I get a call sometime soon.
Peyton: You know Travis Feeney? I know who he is.
Peyton: He got drafted.
Got a Gainesville number calling me.
Who's that? I don't know.
Lisa: Peyton? Peyton? Hello? Hey.
Lisa: Anything yet? No, not yet.
How much longer are we gonna have to wait? I don't know.
Trying to-- trying to see.
Oh.
Football is football.
(laughs) I'm fine.
Each round, each pick that goes by means less money for him if he eventually gets picked.
It's just kind of like the not knowing, the uncertainty, that's the toughest part today.
Alex Collins got picked up by the Seahawks.
(cell phone rings) Hello? Okay, hey, how are you doing? Doing pretty good.
All right, well-- all right, bye.
Lori: What did they say? He just keeps on talking about, like, free-- free agency if I don't get picked up.
Stuff like that.
Toboni: Undrafted players still have an opportunity to sign pro contracts, but they have a slimmer chance of making teams and receive far less money.
(groans in frustration) Peyton: This is kinda-- this is kind of embarrassing.
This is why, one, I didn't want to invite this many people.
For Peyton, what's going on right now? If this is an okay time? Ken Barber: We've had about 12 teams that have been calling, and they want him automatically for a free agency.
So what they're doing right now is making some offers, of what they would offer, basically, as far as for him signing on as a free agent.
And we have to make a decision within the next couple of minutes.
Do you wanna-- it's-- it's Tampa.
What do you-- what do you say? Sure.
Huh? Yeah.
Done deal? Tampa.
(cheers, applause) Toboni: Peyton received a small signing bonus, but wasn't offered a salary to attend the NFL's Tampa Bay Buccaneers training camp.
He was initially cut from the team, but then made it to the active roster after a series of running backs were injured.
Boy, the Bucs clicked.
Sports Announcer: And this is your ballgame right here.
Peyton Barber.
His first NFL touchdown.
A 44-yarder.
Toboni: Peyton has been able to stay on the active roster all season, but there's little security in the NFL.
The money-- the money's definitely been helping-- been helping us out a lot but new guys coming in, every day, you know, competing for the same spot that you have.
So, this could be here today, it could be gone the next.
Average lifespan of a running back is two and a half years, or something like that.
Toboni: As revenues continue to grow, the pressure on the NCAA to resolve this issue is only mounting.
The Jenkins case is expected to be in court within a year, and the result could be the end of amateurism.
Hollis: We have some challenges that we have to fix in college sports.
I'd like to see student athletes get something.
It's getting the apartment, it's getting the car, it's being able to live.
Can we do better? Absolutely.
(crowd cheering) Hocutt: Intercollegiate athletics is the second-highest provider of college scholarship behind the GI Bill.
So, when you look at the educational opportunities that are afforded to young people today through participation in college sports, it's significant.
So, let's understand the hypocrisy.
There are no games without the players.
They're selling them! They're not giving you a $50,000 education or cost of living.
They're giving you a seat in the classroom.
It's a goddamn chair.
Toboni: Thousands of student athletes will enter the NCAA next year.
David is one of them.
Basketball's not guaranteed.
And I always tell him take advantage of these colleges, cause they're gonna take-- take advantage of you.
(people shouting)
Kirby Hocutt: They're going to school for free.
We're meeting all of their needs.
You might make a lot of money if you get into the pros, and yet, less than one percent of the people make it.
Each round, each pick that goes by means less money for him if he eventually gets picked.
Do you think you would have left college early if you had been, in some way, compensated throughout college? No, honestly.
Go, go, go! Refugee: We are not animals! The cost for broadcast rights to air the games of professional sports has soared over the last 10 years, generating billions upon billions of dollars for their respective leagues.
Pro-athletes have had a share in these rising profits.
However, college athletes haven't.
Now next week, college basketball's biggest draw, the NCAA Final Four, comes to a close.
A single 30-second ad during this event costs more than a million dollars.
In fact, the NCAA will make around a billion dollars this year, but the NCAA forbids any kind of compensation for college players beyond the cost of their college education.
Now many see this as exploitation and unfair, given that most college athletes won't make it to the pros.
Gianna Toboni spent a year following both sides of this growing debate.
(distant applause, cheering) (crowd cheering) Go! Toboni: College sports have become so popular that the five biggest conferences made more than $6 billion last year alone.
With so much money being made off of games played by college kids, we wanted to understand the demands of being a student athlete.
So, we caught up with Michigan State's basketball team as they flew on a privately chartered jet.
Do most people see it as a full-time job? Toboni: And what they want it to add up to is the next step, the pros.
Toboni: While that dream is common, Hall of Fame coach, Tom Izzo explained to us how rare achieving it actually is.
(laughs) Toboni: Yeah.
(Tom Izzo continues) Toboni: While the vast majority of these players never make it to the pros, the NCAA identifies them as amateurs, strictly forbidding them from profiting off of not just their ability, but their name, image and likeness.
This led to a now infamous case, brought by former player, Ed O'Bannon, who sued the NCAA for profiting off of his likeness over a decade after he left school.
Close to 15 years later uh, and they're still making money off of-- off of my image.
Toboni: The federal court system decided that the NCAA's amateurism rules were an unlawful restraint of trade, but the ruling did not call for schools to pay the players directly.
Some players think they're being ripped off, and a new lawsuit is directly challenging the NCAA's model.
O'Bannon and other cases have targeted certain elements of the NCAA's business model.
Your case would fundamentally change college sports.
We hope it will fundamentally change college sports.
Toboni: Jeffrey Kessler changed the NBA and NFL after pursuing groundbreaking litigation that freed up players to bargain for much higher salaries as free agents.
What these players want is fair treatment.
That's all that they've ever been seeking.
The players will get their day in court.
Toboni: And now Kessler has trained his sights on the NCAA.
These athletes, they don't get paid, but everybody else does.
It's not fair, and it's not legal.
What we're trying to do is empower the schools and the conferences to make their own choices about what's fair for the players.
That's all.
Very simple.
This is a freedom of choice case.
Toboni: Former Clemson cornerback, Martin Jenkins is leading the charge in this new case.
While playing for a sports program that brought in more than $70 million in revenue a year, he was not allowed to profit.
Announcer: Jenkins to the 10, and he scores! Why did you join this lawsuit? I don't want to see college athletes struggle when the school that they're working for, technically, is making hundreds of millions of dollars off of them.
Did you expect to make it to the NFL? Absolutely, absolutely.
What happened when you graduated college? Jenkins: I had four surgeries in college.
Tore my labrum, had surgery on that.
Tore my groin, had surgery on that.
I tore a ligament in my foot, had surgery on that, and I tore a ligament in my thumb, had surgery on that.
When I graduated, I initially went to a training camp, went to rookie camp with the-- the New York Jets.
Same kinda thing persisted, had some injuries.
So after giving it a couple tries, I said, "You know, it's-- it's kinda time to hang it up.
" You spent years, uh, playing football and suffering injuries, and you couldn't profit off of your athletic ability during those years.
Mm-hmm.
Mm-hmm.
You graduated, and it was injuries that, in part, took you out of the game.
Do you think that your prime earning years were when you were in college? Yeah, I can actually agree with that.
Yes.
The case that-- that you guys are bringing could really change the future of college sports.
In a very strong, positive way.
If the schools are allowed to decide how to compensate these players, we believe they'll do the right thing and the fair thing.
So schools wouldn't be required to pay athletes, they'd be allowed to? That's right.
That's something that the market would decide.
Just like the market for anybody else in entertainment, or anybody else in sports, or anybody else who has a job.
You let the employers decide what's the fair competition, and then the marketplace reaches a decision on that.
The money is there.
Toboni: That same approach was applied to free agency in pro sports.
Just as that market was ballooning as new broadcasting, and licensing deals added billions to bottom lines.
But introducing a free market in college sports, could spark even more dramatic effects.
We wanted to understand both sides of this debate, but the NCAA and 30 universities declined our request to speak on the topic.
One of the few schools willing to talk to us was Texas Tech.
Let's go! (cheering) (cheering) (grunting) It's college football season in Texas.
We're at Texas Tech, they're playing KU, and fans are going nuts.
(cheering) Toboni: Texas Tech is expected to generate $80 million in revenue this year alone, but as Athletic Director Kirby Hocutt showed us, the debate over player pay becomes more complicated when the cost of running a Division One athletics program is considered.
This is our football training facility.
This is the hub of Texas Tech football.
Take a peek into our team meeting room facility.
It's our team meeting room.
It gives Coach Kingsbury an opportunity to address the entire team at one time.
Toboni: I don't think I've been in a nicer corporate meeting room than-- than this one.
It serves its purpose.
Texas Tech University has invested over $200 million in the last decade into its athletic facilities.
Toboni: Hundreds of millions of dollars are invested directly into expenses like world-class facilities, and personal salaries.
But while the coaches and administrators are compensated well, what they're able to provide athletes is closely regulated.
There's always sandwiches, lunch meats, bagels.
Toboni: So, before a couple years ago, you couldn't have sandwiches, and Gatorade's and things for the student athletes.
You were limited in what type of snacks you could provide, and when you could provide those.
The NCAA's taken great steps forward.
Toboni: Does the Athletic Department turn a profit? We do.
We, uh-- we've been in a a positive financial position for the five years that I've been at Texas Tech University.
The Athletics Department in the past 15 years has invested over $300 million into our athletic facilities.
We have 415 student athletes competing in 17 sports.
They are receiving a free education, that's covering their tuition, their fees, room, books, and then board-- their living expenses.
And then on top of that, this is our second year to provide cost of attendance on top of the full scholarship.
At Texas Tech University, the full cost of attendance is an additional $4,820.
If the day comes, and there are additional payments to-- to select student athletes that are required, you have to consider elimination of opportunities.
I've been in a position before where I've had to eliminate sport programs, and I hope that I'm not in that position ever again to have to take opportunities away from young people.
Toboni: While colleges say they need this revenue to provide scholarships, programs and facilities economists like Rodney Fort see nothing but record growth and record spending.
All schools can afford to pay players.
All of them.
Fort: If my revenues and expenditures are going up at the same rate, because money that's being generated by players is being spent on coaches, and administrators and facilities, then the money to pay the players is already there.
The fact that you're not allocating the money to the players doesn't mean that you couldn't, and that's the-- you know, that's the-- the fallacy.
How has the NCAA changed over the last 30 years? The rise and impact of, um-- of television, and now video streaming, it's changed it into an activity where the conferences that can generate the most money are also in control of how it gets distributed.
The reason that amateurism exists is because it allows the university discretion over a larger portion of the amount of revenues that get generated by the Athletic Department than they would otherwise have, and that discretion comes at the expense of the athletes.
Is there something contradictory about schools making money any way they can off of college sports and then not allowing the athletes, who arguably are the ones generating the money, make a profit.
Many people wonder if this is an outright exploitation.
As an economist, I look at that and say, "Well, yes, that's exactly what they're doing.
" Toboni: But the NCAA goes farther than preventing athletes from sharing in the school's revenues.
Their 400-page rule book prohibits the athletes from making any money off of their athletic ability.
So each year, new controversies make headlines across the country.
but what many don't know is that these same rules apply to athletes before they even graduate high school.
(crowd cheering) So, we're at Under Armour's AAU Tournament, and all of these high school kids are showing off their skills for all the top college coaches that are sitting right here.
And everyone here is wearing Under Armour.
Toboni: We asked Coach Antoinette Bennett to explain how Under Armour benefits from hosting these tournaments for high school athletes.
Toboni: One of Coach Bennett's players, David Beatty, was among the top prospects of this tournament.
He explained how this branding works for the athletes.
Toboni: The reason these brands give these kids free gear is because it amounts to free advertising.
Something that became clear when we visited David's home.
Toboni: Holy shit.
(David laughs) David: Cause I've got sneakers in my mom's car, I have sneakers at my friend's house.
You can pick out any basketball shoe, and I got a story for each one.
Toboni: What about the Terminator ones on the end? (exhales) I got those for Dick's Nationals.
Played on ESPN in them for like five minutes.
Started hurting my feet, took 'em off.
(Toboni laughs) David: First time I wore 'em, last time I wore 'em.
Toboni: How much do you think it's all worth? (hums noncommittally) Probably like $10,000? Toboni: Because you're not getting paid right now, why not just sell your shoes? Help out your family? Because with the NCAA rules, it's like a violation, and they'll try to, like, investigate and do all this other crazy stuff just to, like, stop me from going to college and playing basketball.
Toboni: Even during high school, a violation of NCAA rules could cost David a chance at going to one of the many colleges which are recruiting him.
"We love you, and we care about you, and we want you.
" Toboni: And dozens of universities are offering him that exact opportunity as long as he follows the NCAA rules.
How you feel about that? I mean, it's like I got a lot of sneakers.
Like, why can't I give sneakers to other people, or why can't I help out my family? Cause, like, we need the money.
Toboni: That has David and his mother holding out hope that one day he'll be able to profit off of basketball.
I had to just start answering calls, because I'm not sure if it's a bill collector, or a college recruiter.
So I answered everybody's calls, and most of the time, it was somebody calling, saying they wanted my son.
With all this money these colleges make off these kids they should get a little something.
Toboni: But the man who designed the system behind David's sneakers, Sonny Vaccaro, never intended for the players themselves to be left out.
You paved the way for big brands like Nike to make money off of amateur athletes.
How did you do that? I was sort of an out-of-the-box guy, and when I finally got to Nike, all I did was go there with an idea.
I said, "You guys want to get involved in college basketball?" They said, "Yeah, well, how do you do that?" And I said, "Pay the coaches money for being consultants for Nike, "and we will give the shoes to the schools that they represent.
"They will put them on the feet of the athletes and you'll get exposure.
" I didn't talk to AD's.
I didn't talk to school presidents.
I talked to Jerry Tarkanian, Jimmy Valvano, Eddie Sutton, John Thompson.
I mean, I talked to the coaches, who at that time weren't making the multi-million dollar contracts.
They were working for 30,000 or 40,000.
By 1982, every college coach worth their salt was getting paid by a shoe company.
How did Nike profit off of that model? First year, we had seven or eight schools.
Year two, we had close to 80.
They profited off of it, because they-- and what the world would then see-- are the athletes, or the endorsers, sell the product.
My thought was then, is now, and has proven to be one of the greatest marketing moves in the history of anything, By the time the world woke up, we had everybody.
The system I created was beautiful.
The only thing that morphed into the reality of it all is the athletes should have walked lockstep with the universities and the coaches.
Toboni: It's not just that they haven't walked lockstep.
While players are still prohibited from profiting in any way, their coache'' salaries have skyrocketed.
82 coaches across the country make more than $2 million a year.
The University of Michigan's football coach makes $9 million a year, and at in-state rival Michigan State, the head football and basketball coaches each make more than $4 million a year.
Helping to fuel these salaries, the biggest conferences have their own TV networks that reach tens of millions of viewers on top of lucrative deals with major TV networks.
While filming Michigan State's 49-0 victory over Rutgers, we experienced firsthand the business of college sports.
The Big Ten Network told us yesterday that in order to use the footage that we film in the stadium today, we have to license it for $129 a second, minimum 30 seconds, which means that me talking to you right now is costing us at least $1,000.
Toboni: In total, we were charged more than $3,000 to show game footage we shot ourselves of one of the most lopsided games of the college football season.
But even this blowout could be indicative of the huge role money plays in college sports today.
Rutgers went 0 and 9 in a new conference this season.
Many believe they were only placed there to generate revenue.
Competitive levels have been thrown out completely, because it's all about what schools can make you the most TV dollars as a conference.
Toboni: When Rutgers and Maryland joined the conference.
The Big Ten Network expanded its regional reach, and its audience jumped from 52 million to 60 million, and then The Big Ten made three major TV deals valued at $2.
64 billion.
Michigan State's athletic director, Mark Hollis, who made more than $900,000 last year, talked to us about how these deals influence conferences.
Rutgers, Maryland, joined the Big Ten in 2014, and before that, there was no presence in that TV market in New York, New Jersey.
Of course that brought in eight million more households which means more ad revenues, right, which makes those TV deals much more lucrative.
So, are those TV deals in some ways dictating which teams are in which conferences? I think the commissioners that help guide those decisions, um, were doing so in a way to create the type of resources that we can to keep the services for our student athletes in a way that, um, are either at the level we have or even greater.
I think also what people wonder, though, is then why can't players then take advantage of that, why they can't be benefiting or why they're limited in how they benefit from these deals.
I think players are benefiting from it.
Student athletes today are, you know, provided with the opportunity to receive a lot of benefits from apparel to travel to medical, food.
You give them every-- every opportunity that you can-- academically, athletically and socially-- to be successful.
But are they really getting the opportunity to get an education? Can you guarantee a degree? No.
Can you guarantee that they're getting the right education? No.
You can give them the ingredients, and the opportunity for success.
Toboni: But many college athletes grow frustrated with the NCAA's system, and see pursuing some kind of money during their prime earning years as more beneficial than finishing their education.
Peyton Barber was a running back for Auburn, one of the top football schools in the country.
Announcer: You see Barber, he elevates.
I think that ball makes it this time.
You ever wonder, you're like out on the field, and you see all the fans and the jerseys and all the stuff being sold and do you ever wonder where that money goes? All the time.
We bring in the majority of the money for our school, $80 million to $100 million a year.
Do you see it as a job? Oh, definitely, I mean, getting up at 5:45 in the morning, going to work out.
You have practice, you have meetings all day.
I mean, your day's not really over until 8:00 or 9:00.
Toboni: After making the SEC honor roll in his sophomore season, money issues led Peyton to leave college football and take his chances in the NFL draft.
I don't know if anybody really knows my mom, she's homeless right now.
So, it's kinda-- I'm doing it for her.
At what point did you decide that you were gonna declare for the draft? We've been having, like, some family, you know, problems for a while.
When you come home, and it's like-- including me, it's like five people sleeping in one room sometimes.
That's a hard thing to see.
I just wanted to help my family out and provide for 'em.
Lori: I kinda like wanted to cry when I heard him say that.
I want Peyton to get his education.
Toboni: Do you think you would have left college early if you had been, in some way, compensated throughout college? No, honestly.
What's today? Today will be the day that I'm predicted to go in the draft, so (sighs) we'll just have to see.
Announcer 1: The NFL draft has finally arrived.
Announcer 2: With the first pick, the Los Angeles Rams select Jared Goff.
Toboni: Experts predicted Peyton would be picked in the last four rounds of the draft.
So, on the third and final day of the draft, Peyton and his friends gathered at a driving range to celebrate his new career in the NFL.
I love you, brother.
I love you too, man.
How you been? I'm good, man.
I've been good.
Just waiting? Yeah.
Peyton: Hopefully I get a call sometime soon.
Peyton: You know Travis Feeney? I know who he is.
Peyton: He got drafted.
Got a Gainesville number calling me.
Who's that? I don't know.
Lisa: Peyton? Peyton? Hello? Hey.
Lisa: Anything yet? No, not yet.
How much longer are we gonna have to wait? I don't know.
Trying to-- trying to see.
Oh.
Football is football.
(laughs) I'm fine.
Each round, each pick that goes by means less money for him if he eventually gets picked.
It's just kind of like the not knowing, the uncertainty, that's the toughest part today.
Alex Collins got picked up by the Seahawks.
(cell phone rings) Hello? Okay, hey, how are you doing? Doing pretty good.
All right, well-- all right, bye.
Lori: What did they say? He just keeps on talking about, like, free-- free agency if I don't get picked up.
Stuff like that.
Toboni: Undrafted players still have an opportunity to sign pro contracts, but they have a slimmer chance of making teams and receive far less money.
(groans in frustration) Peyton: This is kinda-- this is kind of embarrassing.
This is why, one, I didn't want to invite this many people.
For Peyton, what's going on right now? If this is an okay time? Ken Barber: We've had about 12 teams that have been calling, and they want him automatically for a free agency.
So what they're doing right now is making some offers, of what they would offer, basically, as far as for him signing on as a free agent.
And we have to make a decision within the next couple of minutes.
Do you wanna-- it's-- it's Tampa.
What do you-- what do you say? Sure.
Huh? Yeah.
Done deal? Tampa.
(cheers, applause) Toboni: Peyton received a small signing bonus, but wasn't offered a salary to attend the NFL's Tampa Bay Buccaneers training camp.
He was initially cut from the team, but then made it to the active roster after a series of running backs were injured.
Boy, the Bucs clicked.
Sports Announcer: And this is your ballgame right here.
Peyton Barber.
His first NFL touchdown.
A 44-yarder.
Toboni: Peyton has been able to stay on the active roster all season, but there's little security in the NFL.
The money-- the money's definitely been helping-- been helping us out a lot but new guys coming in, every day, you know, competing for the same spot that you have.
So, this could be here today, it could be gone the next.
Average lifespan of a running back is two and a half years, or something like that.
Toboni: As revenues continue to grow, the pressure on the NCAA to resolve this issue is only mounting.
The Jenkins case is expected to be in court within a year, and the result could be the end of amateurism.
Hollis: We have some challenges that we have to fix in college sports.
I'd like to see student athletes get something.
It's getting the apartment, it's getting the car, it's being able to live.
Can we do better? Absolutely.
(crowd cheering) Hocutt: Intercollegiate athletics is the second-highest provider of college scholarship behind the GI Bill.
So, when you look at the educational opportunities that are afforded to young people today through participation in college sports, it's significant.
So, let's understand the hypocrisy.
There are no games without the players.
They're selling them! They're not giving you a $50,000 education or cost of living.
They're giving you a seat in the classroom.
It's a goddamn chair.
Toboni: Thousands of student athletes will enter the NCAA next year.
David is one of them.
Basketball's not guaranteed.
And I always tell him take advantage of these colleges, cause they're gonna take-- take advantage of you.
(people shouting)