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NCAA Scrutiny Plagues UNC, Big-Time College Sports

North Carolina lost to Georgia Tech over the weekend, 30-24. It was the second consecutive game the Tar Heels lost by that score. And it was the second consecutive game in which at least a dozen players were suspended as the NCAA investigates allegations of academic fraud and that agents paid for several trips for athletes. UNC is hardly alone in its troubles. A star player at Georgia is suspended for selling his game-worn jersey to an agent. One of college football's most marquee programs - the University of Southern California - lost several scholarships this summer and was banned from the post-season for two years. Dave DeWitt of North Carolina Public Radio has more scandals that have roots in the economics of big-time college sports. Butch Davis strides into the interview room at the Kenan Football center wearing an argyle sweater and no sign of his usual confident grin. UNC's football program is sailing through uncharted waters. Thirteen players were suspended for the first game against LSU and it looks like major violations and NCAA sanctions are on the way. Davis offers his thoughts on Georgia Tech's triple option, but he knows many reporters hear are speculating about his job status. He talks about the broader issue of balancing athletics and academics. "The number one goal and objective of every football player who comes here should be to come here and get an education and get a degree first, because there's going to be a lot of kids, now and in the future, who are not going to play professional football," he says. When the press conference is over, Davis walks right by a large mural featuring former and current players. Above it, in bold letters, it reads "Pipeline to the Pros." It's not the only mixed-message college athletics sends. Davis makes more than $2 million a year. The players get a scholarship, plus free room and board, worth around $20,000 a year. Andrew Zimbalist, an economics professor at Smith College. He says you can draw a straight line between that discrepancy and the scandals at UNC and elsewhere. "When you have a suppression of the market mechanism but the underlying activity that's taking place has strong value, then what happens is that individuals find a way to pay the producer anyway," he says. But Zimbalist says the problem is more than just an unscrupulous agent paying a rogue player. He points to universities setting up large student-athlete tutoring operations. "And hence there's a great big charade that develops all to convince whoever needs to be convinced that there's an educational process that's going on simultaneously with the commercialized sport." According to the NCAA and USA Today, North Carolina's athletic department generated more than $70 million in revenue last year. About $7 million (10 percent) went to pay for athletic scholarships in all sports. A professional team or entertainment business will pay athletes or performers a total of about 60 percent of its revenues. But Jon Pritchett thinks the college system has the balance about right because just a few of the athletes turn into stars. Pritchett is the CEO of Club 9 Sports, a sports marketing and finance firm. "Even if you don't play and you don't turn out to be as good as when they sign you, the school will still honor that scholarship, you still get all those benefits, and so I would say that in the end it's still a good deal for the student-athletes," he says. Pritchett says the real problem is skyrocketing expenses. That forces athletic directors either to cut sports or to look under every rock for more revenues. Several schools switched conferences over the summer to try to maximize those revenues. School logos can be found on everything from shot glasses to caskets. And few things pay off for schools like video games. In EA Sports' NCAA Basketball 2010, you can play as any major college team. The graphics and presentation are incredibly realistic. Real teams like Duke and North Carolina, and real players, too, accurate right down to their physical characteristics, uniform numbers and facial expressions. You can even play as past great teams, like the 1995 NCAA champions UCLA. They were led by power forward Ed O'Bannon. Today, O'Bannon is 38 years old and sells Toyotas in Las Vegas. A knee injury cut his pro career short. He doesn't get a dime from the NCAA or EA Sports, and he's now the lead plaintiff in a class action lawsuit against the NCAA. He wants compensation for the use of his likeness. "You know, we hope schools will step up and live up to their role which they really should be performing here, which is to help the players, help them share in the revenue, help them get on their feet if they need assistance as they continue to generate great wealth for the schools and the NCAA even after they leave," says Jon Kins, O'Bannon's attorney. Legal analysts say the O'Bannon case could be groundbreaking and will take years to get through the courts. If they lose, the NCAA and member schools could be forced to pay former athletes hundreds of millions of dollars, and forever change the economics of big-time college sports.