College athletics experienced a massive change. For decades, athletic departments generated millions through television contracts, ticket sales, sponsorships, and conference distributions, while athletes were limited to scholarships and school-provided benefits. That structure began to shift in 2021 with the introduction of Name, Image, and Likeness (NIL). Now, a second major change has happened this year with revenue sharing between schools and athletes. Both involve compensation and are part of the new era of college athletics, but they operate in very different ways. Understanding those differences is critical for athletes and parents making recruiting and long-term decisions.
What Is Name, Image, and Likeness?
NIL refers to an athlete’s right to earn money from their personal identity. That includes their name, photo, voice, social media presence, or overall brand. NIL allows athletes to enter endorsement deals, promote products, appear at events, run camps, or partner with businesses that want to use their identity for marketing purposes.
NIL money typically comes from third parties, not directly from the school. A local business, national brand, or collective may compensate an athlete for promotional services. The value of those opportunities depends on the athlete’s marketability, audience, reputation, and brand positioning. Two athletes on the same team can have completely different NIL outcomes because NIL is tied to personal entrepreneurship. Athletes who build trust, tell their story well, and maintain a professional presence tend to create more opportunities. Ultimately, NIL belongs to the athlete who understands that a personal brand is the foundation for immediate earnings and even long-term partnerships beyond sports.
What Is Revenue Sharing?
Revenue sharing operates on a different foundation. Instead of outside brands paying athletes, revenue sharing allows schools to directly distribute a portion of athletic department revenue to athletes.
Beginning with the 2025/26 academic year, participating schools are expected to be permitted to distribute up to approximately $20.5 million per year directly to athletes. That figure represents the annual cap per school under the current framework, and it is projected to increase over time. The cap is commonly described as being tied to roughly 22% of certain average athletic department revenues, creating a benchmark that adjusts in future years.
All the revenue sharing money comes from the athletic department’s own revenue sources. Those sources include television contracts, conference distributions, ticket sales, sponsorship agreements, and other media-related income. This is not outside marketing money. It is school-controlled revenue being redirected to athletes.
Why Revenue Sharing Looks Different at Every School?
Revenue sharing will not look the same across the country. Some institutions may fund the maximum to remain competitive. Others may allocate less depending on budget realities and conference positioning. The distribution of that annual pool depends heavily on the sports structure at each institution.
At many major athletic programs, football generates the largest share of institutional revenue. Roster sizes are larger, operating costs are substantial, and media rights agreements carry significant value. These factors often result in a significant portion of revenue-sharing funds being allocated to football. Projections at several institutions indicate that football may receive more than half of the available pool. Men’s basketball typically follows, with women’s basketball and other sports receiving the remaining balance based on visibility, revenue potential, and competitive priorities.
This structure creates substantial variation across schools. A Power Five program may devote a large percentage of its $20.5 million cap to football alone. An institution without football can distribute those funds across other teams. These allocation models can significantly shape recruiting discussions and influence how athletes evaluate their options.
When an athlete is deciding between schools, they may see very different compensation models even if both schools operate under the same overall cap. One school might dedicate a large portion to football, leaving a smaller share for Olympic or non-revenue sports. Another school without football could allocate a greater percentage to basketball, baseball, soccer, or other programs. The institutional sport profile directly impacts distribution.
Recruiting decisions will increasingly involve understanding how a specific school plans to allocate its revenue-sharing pool. As a player or parent navigating the recruiting process, it is important to ask direct questions about how revenue sharing works within that program and how those funds are distributed among athletes.
The Core Difference Between NIL and Revenue Sharing
The difference between NIL and revenue sharing comes down to source and purpose.
NIL is market-driven. It is tied to an athlete’s brand value and commercial appeal. Compensation depends on relationships, visibility, audience, and strategic positioning. Two athletes at the same university can have very different NIL outcomes because NIL reflects individual brand strength.
Revenue sharing is institution-driven. It comes from the school’s athletic revenue pool and is distributed according to internal allocation decisions within the settlement cap. It is not based on social media following or personal marketing deals. It is based on how the school chooses to divide its athletic revenue among sports.
Both systems can exist at the same time. An athlete could receive revenue sharing from their school and still pursue NIL opportunities independently.
For athletes and parents, the strategic takeaway is clear, NIL depends on how well you build your personal brand, and revenue sharing depends on how the school divides its money. The distribution model at each institution can significantly impact financial outcomes for athletes. Understanding that structure may become one of the most important factors in choosing which school to attend.