The National Collegiate Athletic Association (NCAA) adoption of a new policy on July 1 that allowed players to be able to profit from their name, image, and likeness (NIL), has ushered in a new era for college athletics. It is an inflection point that will create a new paradigm that multiple stakeholders will have to adjust to. It represents a major deviation from a status quo that has been in place for generations. Players will now be able to cash in on the fame that the platform of college sports provides for the first time.
It is a monumental victory for the economic empowerment of student-athletes that removes the shackles that previously restricted players from being able to profit from their name, image, and likeness. It opens the possibility for life changing financial resources to go to families who may have been historically excluded from other wealth building opportunities. The overwhelming majority of student-athletes will not make it to the NBA, NFL, or other professional leagues. Their window to economically benefit from their athletic prowess expires when their college eligibility does. This is why the NIL ruling is incredibly important.
The quick passage of this measure with little regulation and relatively vague instructions has left a lot of open room for how it will ultimately be implemented. The NCAA issued the following guidance:
The NCAA made a distinction between NIL and schools directly paying players by stating that “while opening name, image and likeness opportunities to student-athletes, the policy in all three divisions preserves the commitment to avoid pay-for-play and improper inducements tied to choosing to attend a particular school. Those rules remain in effect.”
Though it is not a formal pay for play situation, the opportunities for student-athletes and their families to financially benefit from this ruling are substantial. The term that I have previously used to describe the pursuit of sports stardom, “the athletic lottery”, has become even more relevant with this ruling and preceding declarations from the NCAA over the past year. There are many more eligible student-athletes competing for the same number of spots on college sports rosters with players being granted an additional year of eligibility and the one-time transfer rule being put in place. These spots also have much more lucrative potential now with the passage of the new NIL ruling.
This rule change from the NCAA comes on the heels of the Supreme Court ruling in the NCAA v. Alston case on June 21, 2021 that involved a group of current and former student-athletes “challenging the NCAA’s restrictions on compensation. Specifically, they alleged the NCAA’s rules violate the Sherman Act, which prohibits ‘contract(s), combination(s), or conspiracy(ies) in restraint of trade or commerce” according to the court’s ruling. Justice Brett Kavanaugh gave a blistering critique of the NCAA that could open up the floodgates for future lawsuits. Kavanaugh wrote that sports traditions “cannot justify the NCAA’s decision to build a massive money-raising enterprise on the backs of student-athletes who are not fairly compensated. Nowhere else in America can business get away with agreeing not to pay their workers a fair market rate…. The NCAA is not above the law.”
The momentum that was manufactured by college basketball players before the NCAA Tournament using the hashtag #NotNCAAProperty, and a set of NIL state policies that became effective on July 1 in Alabama, Florida, Georgia, Mississippi, New Mexico, and Texas also played pivotal roles in pushing the NCAA to make this new ruling.
