The sports industry experienced a year of considerable change in 2024, creating opportunities for athletes, sportsbooks, teams, and investors. This article highlights five of the main developments in 2024: developments in sports betting; the House v. NCAA settlement; the growth in private equity, women’s sports, and the monetization of sports; streaming services in sports media; and the use of artificial intelligence (AI) in sports and betting. In 2025, we expect to see developments in each category, along with accompanying legal challenges as changes and advancements unfold.
Developments in Sports Betting
Since the U.S. Supreme Court’s decision to overturn the Professional and Amateur Sports Protection Act in 2018, 38 states and Washington, D.C., have legalized sports betting;1 31 have authorized live mobile sports betting.2 In 2024, licensed sportsbooks generated nearly $150 billion in handle3 and more than $14.2 billion in operator revenue.4 States and local governments collected $2.9 billion in tax payments, and the federal government collected over $375 million through the federal excise tax.5 New York remained the largest market, and it was the first state to exceed $2 billion in revenue.6
The growth in the sports betting market did not come without its setbacks. Regulators in eight states brought enforcement actions against more than 20 licensed gaming operators for impermissible activity relating to, among other things, wagers and self-exclusion, tax, marketing, promotional wagering, licensing, financial filing, and responsible gaming violations.7 The New Jersey Division of Gaming Enforcement was the most active among the state regulators, and moving forward, other states may increase their enforcement efforts in an effort to match New Jersey’s example.8
There are several areas to watch for developments in state-regulated sports betting. First, states will likely remain focused on restrictions to curtail problem gambling.9 Second, regulators will likely continue to target offshore operators and operators that offer sweepstakes.10 Third, states may revise their definitions of fantasy sports to establish regulatory frameworks, tax structures, and consumer protections for this growing segment of the gaming industry.11 Finally, 2024 was marked by some of the most significant instances of sports betting misconduct in many years.12 States and other stakeholders will continue to analyze ways to curtail improper behavior.
In 2024, the federal government also became more engaged in the discussion around sports betting. In September 2024, Senator Richard Blumenthal (D-CT) and Representative Paul Tonko (D-NY) introduced the SAFE Bet Act.13 The act sets forth minimum federal standards with which state regulators and sportsbook operators would need to comply in three main categories: advertising, affordability, and AI.14 The act is unlikely to pass with a Republican-controlled Congress.
The Senate Judiciary Committee also held the first hearing focused on the possibility of federal regulation for sports betting.15 The committee focused on problem gambling, proposition (“prop”) betting, athlete harassment, and the SAFE Bet Act.16 Many of the witnesses and senators agreed that some level of federal oversight would be beneficial.17 Based on President Trump’s historical ties to the gaming industry, however, it is unlikely that we’ll see federal regulation of gaming in 2025.18
The House v. NCAA Settlement
In 2021, the Supreme Court ruled in favor of student athletes and unanimously upheld a decision that NCAA rules limiting education-related compensation violated Section 1 of the Sherman Act.19 Shortly thereafter, the NCAA voted to allow student athletes to receive compensation in exchange for use of their name, image, and likeness (NIL).20 In the years that followed, three cases asserting that the NCAA violated antitrust laws were filed and eventually consolidated: House v. NCAA, Hubbard v. NCAA, and Carter v. NCAA.21 The plaintiffs alleged “that the NCAA and its Power Five conferences conspired to exploit student athlete behavior and that the NCAA’s restrictions on [NIL] payments and control of TV markets prevent student athletes from realizing their true market value.”22 The parties reached a settlement agreement in May 2024 (House Settlement).23 The settlement has not yet been finally approved.
There are three main features of the settlement: (1) back pay to former college athletes who were barred from earning NIL compensation prior to the NCAA’s 2021 change in policy; (2) a new revenue-sharing structure; and (3) new roster regulations. Back pay will date back to 2016 and will be paid over 10 years.24 The revenue-sharing structure allows athletic departments to pay athletes up to 22 percent of revenue generated from media rights, ticket sales, and sponsorships, a sum that is expected to yield $20-22 million when the settlement goes into effect at the start of the 2025-2026 academic year.25
Initially, Judge Wilken in the Northern District of California declined preliminary approval of the settlement, expressing concern over settlement provisions limiting NIL payments to “valid business purpose[s]” and requiring NCAA approval of third-party NIL deals.26 In October 2024, after the parties narrowed terms, Judge Wilken granted preliminary approval of the revised settlement.27 A hearing is scheduled for April 7, 2025, and Judge Wilken is expected to issue a ruling in spring 2025.28 Regardless of the outcome, however, the decision is likely to be appealed to the Ninth Circuit.
Hundreds of current and former college athletes have filed objections to the settlement, citing concerns about potential roster limits and issues pertaining to gender equity and antitrust.29 The settlement eliminates scholarship caps but permits the NCAA to introduce roster limits, which athletes allege may cause significant financial damage to thousands of student athletes with prearranged NIL contracts.30 There is also a growing concern that the settlement’s revenue-sharing structure will perpetuate issues of gender inequality associated with inequitable revenue sharing between male and female sports.31 Finally, the settlement has been criticized for not solving the antitrust issues allegedly imposed by the NCAA’s business model.32 Shortly before President Trump’s inauguration, the DOJ filed a letter asserting that the cap on revenue sharing “functions as an artificial price cap on what free market competition may otherwise yield.”33 The Trump Administration's view on the settlement is unclear, but any issues that arise involving Title IX may be impacted by the executive order Keeping Men Out of Women’s Sports.34
In addition to the outcome of the settlement, there are several related issues to watch in 2025. Hundreds of athletes have opted out of the settlement thus far.35 They have filed lawsuits in several districts in an effort to receive a payment higher than the settlement offers.36 In addition, in response to criticism regarding the roster limits, a lawyer for the NCAA has expressed that the settlement does not protect the NCAA from future litigation over roster limits.37 In 2025, we will likely see continued developments in the college sports landscape, even if the settlement is approved.
The Growth in Private Equity, Women’s Sports, and Monetizing Sports
As professional and collegiate sports revenue continues to grow, new opportunities for investors and business partners have emerged. The value of professional and collegiate athletics has only continued to grow. For example, in 2024, NBA teams were worth $4.4 billion on average, a 15 percent increase from 2023.38 The Southeastern Conference alone, which is part of the NCAA, was worth roughly $13.3 billion, an average of about $832 million per school.39
In August 2024, the NFL became the last of the four major U.S. professional sports leagues to approve private equity ownership.40 Until then, the NFL prohibited private equity firms from investing in teams, and Principal owners are still required to own at least 30 percent of a team.41 But with the sharp increase in franchise value—for example, the Dallas Cowboys were valued at over $10 billion in 2024—there was concern that it would be difficult to find enough investors to purchase franchises going forward.42 Now, NFL teams are allowed to sell up to 10 percent of their ownership to investment firms that have been approved by the NFL.43
Women’s sports are also on the rise, with global revenue reaching more than $1 billion for the first time in 2024.44 Women’s sports have been labeled one of the fastest-growing industries, and investors are not shying away from the recent growth in popularity.45 Global investment firm Sixth Street, for example, recently became a major investor in Bay Football Club, a National Women’s Soccer League team based in the San Francisco Bay Area.46 As investors see the potential for revenue in women’s sports, it’s likely that institutional investors, private equity funds, and high-net-worth individuals will continue to invest in this space.47
In light of the House Settlement and the new business model emerging in college sports, investors have turned their attention to college sports.48 Based on changes to NIL rules, many colleges will soon be required to pay student athletes, and schools will have media rights deals.49 Investors are creating new businesses to meet the anticipated need for college athletic departments to access capital. For example, Collegiate Athletic Solutions, a company that provides advice and capital to help schools monetize their intellectual property, launched in 2024.50 Additional businesses are likely to develop to take advantage of the opportunity to invest in college sports.
These new and expanding business ventures bring litigation and compliance risks, particularly as they relate to securities, antitrust, labor law, and related regulatory concerns. Private equity investments in sports can bring unique securities litigation concerns, including regulatory scrutiny and disputes relating to governance, control, and fiduciary duties; valuation; allegations of unfair practices or breaches of fiduciary duty; and revenue-sharing agreements, sponsorship deals, and other financial arrangements.51 There are also several antitrust concerns stemming from the growth of private equity investments in sports, including concerns regarding reduced market competition; revenue sharing; broadcasting rights; and restrictions on ownership or investment structures.52 In addition, the involvement of private equity in collegiate sports could create labor law issues by blurring the lines between amateurism and professional sports, prompting legal challenges regarding whether student athletes should be classified as employees.53
Trends indicate that 2025 will see a greater influx of private investments and businesses looking to help generate additional revenue.54 Businesses need to consider the litigation and compliance risks that may arise from these new ventures.
Streaming Services in Sports Media
Another notable change in sports that may have legal consequences is the industry’s growing reliance on streaming platforms as opposed to traditional cable broadcasting.55 Although the shift to streaming is not a new phenomenon, in 2024, Congress indicated an increased interest in regulating the sports industry’s relationship with streaming.
In January 2024, Peacock became the first streaming provider to exclusively livestream an NFL playoff game.56 Before the NFL provided Peacock with the exclusive rights to broadcast the 2024 wild card playoff game, wild card games were traditionally aired on network television (NBC, CBS, Fox) or through the NFL’s digital platforms.57 The agreement faced criticism, including by Congressman Pat Ryan (D-NY), who asserted that the agreement forced fans to “face exorbitant prices.”58
This recent broadcasting deal with Peacock and accompanying criticism led the House Communications and Technology Subcommittee to call a hearing on January 31, 2024, to discuss the impact of the rapid rise in sports streaming services.59 Notably, during the hearing, Subcommittee Chair Bob Latta (R-OH) observed in his opening remarks that “the NFL decided to show one of its playoff games exclusively on a streaming platform. This game was the most streamed event in U.S. history. At the same time, its limited reach made it the least watched NFL playoff game this year.”60 The exclusive streaming of sports events has lower viewership compared with cable broadcasts.61 This is likely due to the growing price of watching games and consumers’ frustration with navigating various apps.62 For example, to watch the Kansas City Chiefs/Miami Dolphins wild card playoff game, viewers outside local Kansas City and Miami markets were required to download the Peacock app and pay for a Peacock subscription.63 During the hearing, Congresswoman Matsui (D-CA) commented on the fact that streaming helps consumers by, among other things, increasing competition, but that “the massive fragmentation of the sports media market means consumers must now sign up for multiple streaming services to get the content that they want.”64
This shift in broadcasting rights could lead to significant changes in Congress’s approach to antitrust exemptions for professional sports organizations.65 Scholars suggest that the Sports Broadcasting Act of 1961 (SBA), which provided the NFL with an exemption for “sponsored telecasting,”66 likely does not apply to streaming services in the same way it applied to traditional broadcasting.67 If streaming service agreements are found to fall outside the exemption,68 the NFL may face liability under the Sherman Act.69
Questions regarding antitrust issues pertaining to broadcasting rights may soon be answered with the resolution of In re National Football League Sunday Ticket Antitrust Litigation. In 2015, a class action was filed against the NFL, all 32 NFL teams, and DirecTV after those same parties agreed to offer games exclusively on DirecTV’s streaming service NFL Sunday Ticket.70 The plaintiffs alleged that the NFL engaged in anticompetitive activities by “pooling” teams’ broadcasting rights into one agreement, thereby blocking the sale of broadcasting rights on a team-by-team basis.71 The plaintiffs alleged that this prevented other streaming services and networks from competing for broadcast rights and limited the viewability of NFL games.72 In August 2024, nearly a decade after the litigation began, and after the jury found in favor of the plaintiffs and awarded over $4.7 billion in damages, the court overturned the verdict.73 Ultimately, the court entered judgment for the NFL, holding that plaintiffs’ experts on damages should have been excluded and that the jury’s damages awards were not based on the “evidence and reasonable inferences.”74 The case is now waiting to be heard by the Ninth Circuit following the plaintiffs’ appeal.75
Following a decision in this case, the landscape of broadcasting rights could undergo a seismic shift. The outcome will have far-reaching implications across all professional sports leagues and may even result in congressional amendments to the SBA.
The Use of AI in Sports and Betting
AI has transformed the business world, and sports are no exception. In 2024, both the NBA and the NFL demonstrated that they plan to take advantage of this growing technology.76 During the 2024 All-Star Game, the NBA introduced NB-AI, its generative AI tool, which can analyze live video in real time to answer fan questions or transform footage.77 During the 2024 Superbowl, the NFL released its new Digital Athlete Program, which generates game-like simulations and player health information to allow teams to analyze athletes’ potential for injury.80 Leagues are not alone in their growing use of AI.
AI also plays a significant role in sports betting. Many sportsbooks currently use AI to predict game outcomes by analyzing data such as player statistics and game day weather conditions.78 Sportsbooks are also using AI to produce personalized betting experiences. For instance, BetBuddy, an AI-based analytics software, analyzes users’ personal betting habits, styles, and preferences to make recommendations that align with the bettor’s approach.79 It even takes bettors’ risk aversion into account.80 Arguably, however, the most notable AI development in sports betting is its use in preventing fraudulent betting.81 Sportsbooks are increasingly using fraud detection systems that use AI to analyze betting patterns and detect fraudulent activity.82
The use of AI in sports implicates a variety of legal considerations, including privacy rights, publicity rights, and the potential for intentional misuse.83 AI-based programs that use athletes’ health and personal data, such as the NFL’s 2024 Digital Athlete Program, are subject to federal and state data protection and privacy regulations, which impose several limitations. AI’s use of a person’s likeness also raises issues pertaining to publicity rights.84 There is an increasing fear that AI-generated likeness can be intentionally misused. For example, the NFL has raised concerns that deepfakes of well-known NFL figures could be exploited for phishing attacks or other fraudulent activities.85 The potential misuse of AI-generated likeness was recently highlighted by the introduction of the No Fakes Act in the Senate.86 This followed the release of the U.S. Copyright Office’s Digital Replicas Report, which explicitly stated the “urgent need” for comprehensive protection regarding AI use of a person’s likeness.87 A companion bill was also introduced in the House.88 These bills are designed to protect against unauthorized use of a person’s voice or likeness in digital replicas by establishing a federal intellectual property right to a person’s own voice and likeness.89
The use of AI in sports will continue to expand. Policy changes and state and federal regulations are likely to follow. In 2025, the integration of AI in sports will face new challenges, including issues related to ethics, data privacy, and ensuring fairness in gameplay and business practices.
Conclusion
As noted by these developments, the sports industry underwent significant changes in 2024, presenting new opportunities across various sectors. As we look ahead to 2025, these developments are expected to continue evolving, bringing further advancements, shifts, and legal challenges as the industry adapts.
Footnotes
