USC has long wanted to get itself into a financial position where it can offer full tuition to students from lower-income families, as schools like Harvard and Stanford do. That was one of the goals of its $6 billion endowment drive. I suspect the timing of the announcement has something to do with the recent scandals, but the idea of free tuition isn’t something USC just came up with as a PR move.
Also, USC’s application numbers were about 64,000 in 2018 and 66,000 in 2019.