As America is grappling with the changing business of college athletics, financial alarm bells are ringing with a similar tone in Europe. Specifically, a recent report noted that English football clubs are struggling with rising player costs and debt, with nearly two-thirds of clubs designated as “technically insolvent.” Average losses for Premier League clubs specifically have doubled in the last five years. Stratification amongst the tiers of the English football system has also intensified, with the largest Premier League clubs now earning approximately 173 times as much revenue as the average club in the next division.

Duke football coach Manny Diaz noted in a recent interview on the Andy & Ari podcast how much this concerning financial picture resembles what is occurring in American college athletics. Universities are taking on substantial debt and operating at significant deficits in order to keep up with rising revenue-sharing demand from athletes, as well as other costs. Additionally, the financial gap between the conferences is growing to the point where schools outside of the SEC and Big Ten are scrambling for ways to stay competitive.

Beyond the issues these European clubs face, American universities must grapple with a significant additional layer of complication. Whereas the latter must determine how to maintain financial liability for one revenue-driving team, college athletic departments must balance the needs of multiple sports operating under their umbrella. This includes sports such as football and basketball that drive and bring in revenue, as well as several others that do not. For universities that are losing profitability or who become upside down in debt in their football programs for reasons similar to those English clubs, the path towards overall solvency and viability becomes even less clear.

Although the Protect College Sports Act is intended to help end the financial strain schools are feeling, it would lock-into place an even more expensive direct revenue-sharing system then the one currently in place. Specifically, beyond the roughly $21.5 million in revenue-sharing that schools would be able to pay athletes in the 2026-2027 academic year, schools would also be permitted to spend an additional $22.5 million to retain athletes already enrolled at the school. Beyond that, universities could spend another $5 million beyond that retention fund number to keep enrolled athletes in Olympic and women's athletic teams. That leads to a maximum total revenue sharing outlay of approximately $48 million per academic year. To maintain solvency, athletic departments will have to have a clear plan and process for absorbing and accounting for this increased cost.

As our English football counterparts have recognized, the NCAA, its conferences, and its universities must work now to prepare and plan for a viable financial future. In doing so, schools must accept that their needs, exposures, and outlooks have fundamentally changed. Accordingly, they will need partners who see those changes and can work with and advise them on the business, regulatory, and other risks ahead. For both English football and American college athletics, that is the only path to long-term prosperity and solvency.

In a damning report on English football’s financial resilience, the Independent Football Regulator (IFR) has described an industry that is increasingly unequal, hooked on debt and owner top-ups, loss-making and incapable of controlling costs.

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