5 Issues To Keep An Eye On With The NCAA’s New NIL Policy

On Tuesday, the NCAA’s Board of Governors released a statement that it had unanimously voted in favor of permitting college athletes to financially profit from the use of their names, images, and likenesses. The new NIL policy is set to go into effect in 2021. The press release represented an apparent change to an NCAA model for amateur intercollegiate athletics that restricted college athletes from benefiting from any commercial value built from their reputation from their efforts on and off the playing field.

Note that the NCAA’s amateurism model for intercollegiate athletics does not restrict either the NCAA or its members from generating billions of dollars by leveraging college athlete NILs for lucrative media deals. The NCAA’s amateurism model also does not restrict college coaches from making millions each season. The college athletes who actually play the games, however, have compensation that is capped at the cost it takes to attend their college or university. Thus, there should be no surprise to learn that the NCAA’s critics have referred to the amateurism model as the “shame of college sports.”

The NCAA’s exploitation of college athletes has led to more than just criticism; there have been lawsuits and even legislative efforts to force the NCAA to alter its unfair policies. Unfortunately, legal threats and economic pressure have proved to be the only successful means for moving the NCAA to modify its rules to protect college athletes from ... the NCAA.

Thus, the aforementioned and announced change in policy definitely represents a step in the right direction. We know that this change will not result in schools directly paying athletes for the use of their names, images and likenesses in commercial broadcasts or for other promotional purposes. The NCAA remains steadfast in its opposition to fair compensation for its athletes under the guise that it intends to preserve a purported demarcation between professional and intercollegiate sports.

We also know that the NCAA’s policy represents a change from the previous approach in which NCAA bylaws prohibited athletes from benefiting from the commercial use of their NILs. Yet what remains unknown is exactly how much freedom college athletes will be permitted by the NCAA’s new policy because the actual rules regulating athlete publicity rights have not been disclosed.

Still, one does not need a crystal ball or psychic powers to predict that there are some key story lines that need to be followed closely as the NCAA’s policy transitions from an idea into practice.

What Will Happen With The NIL Legislation?

First, let’s be very clear that the NCAA did not act altruistically in declaring a change to its NIL policies. The NCAA did form a working committee to discuss possible changes, and that group has been meeting for months. Yet we should not ignore the legal pressure asserted on the NCAA that forced its change in position.

On September 30, California Governor Gavin Newsom signed into law the Fair Pay to Play Act, which makes it illegal for California colleges to restrict college athletes from being compensated for the use of their NILs. The Fair Pay to Play Act was passed despite fear mongering earlier this summer from the NCAA that included threats to exclude California members from championship competitions.

Ten other states—Colorado, Florida, Illinois, Kentucky, Minnesota, Nevada, New York, Pennsylvania, South Carolina and Washington—have since joined California with their own legislative proposals to protect college athlete publicity rights; those bills have yet to be enacted into law. Additionally, Rep. Mark Walker (R., N.C.) introduced a bill before Congress that would amend the NCAA’s status as a qualified amateur sports organization for tax purposes if it continued “prohibiting or substantially restricting the use of an athlete’s name, image and likeness.” The relatively rapid push for legislation in those states and in Congress represents a loss of deference for the NCAA’s bylaws and a tightening noose with regard to the political pressure placed on the NCAA to change those bylaws.

While the NCAA’s change in position likely will have no influence over California’s already enacted legislation, it could slow legislative momentum in states that have not yet passed laws to protect college athletes. Whether the NCAA is able to slow or stop the law-making momentum that started in California remains to be seen.

How Will The NIL Policy Change Affect Recruiting And Athlete Access To Social Media?

Athletic programs that are the first to embrace the change in NIL policy may gain a competitive recruiting advantage. The NCAA currently caps athlete compensation at the cost of attendance and this amount is well below the market value for some athletes. As a result, programs compete for the best athletes by spending on them indirectly (e.g. investing in the best coaches and building lavish facilities). For example, Alabama’s football locker room has a waterfall whereas LSU’s new $28 million dollar locker room includes sleep pods similar to those found on first-class international flights.

At some point, some smart programs will likely try to capitalize on the NCAA’s NIL policy by turning it into a recruiting advantage. For example, a program may hire a staff member (or “brand coach”) to assist college athletes with their personal brand building. It’s doubtful that the NCAA would allow schools to hire press agents for their athletes, but perhaps programs could hire branding specialists to train athletes in how to build their personal brands.

Another possible consequence of the NCAA’s change in policy may be the cessation of social media restrictions imposed on athletes by their coaches. Social media outlets like Twitter are tools for brand building and athletes will need access to those sites in order to cultivate consumer interest in their identities.

The paternalistic desire of coaches to “protect” their athletes from saying the wrong thing on social media may eventually give way to the more compelling desire to successfully recruit the best talent. Programs that preserve their Twitter bans and other social media restrictions may get left behind in the competition for coveted players to programs that permit social media use and train their athletes in how to make the most of social media.

How Will The Change Affect Women’s Intercollegiate Sports?

The NCAA in its press statement made clear that its new NIL policy will “enhance principles of diversity, inclusion and gender.” It’s true that men’s football and basketball are the most popular NCAA sports and are also the most successful in regards to revenue generation. The popularity of those two sports may result in more branding opportunities for the male athletes who play them. Yet a sex-neutral NIL policy may actually benefit women college athletes more than most may think.

Lindsey Darvin is a former two-sport NCAA student athlete and is now an assistant professor of sport management at SUNY Cortland with a research expertise in diversity and gender equity in sport. Darvin is actually bullish on the NCAA’s change in policy and the possibility that it will positively influence women’s sports. The reason for this is found in her recognition of the limited opportunities for women to make professional careers from their time playing college sports.

According to Darvin, “the NCAA is far and away the highest level of exposure for women athletes.” She added that “even if they do go pro their games are much less likely to be televised.” That is why Darvin asserts that by allowing women the opportunity to grow their personal brand during their college careers, the NCAA will actually open possibilities for more women athletes to maximize their earning potential through sports. She added that the brand equity built by women athletes in college could also translate into them obtaining careers in private coaching or in the operation of camps when their playing days are over.

Will EA Sports’ NCAA Football Be Resurrected?

The same day that the NCAA issued its press statement Kirk Herbstreit, a former Ohio State quarterback and current college football commentator for ESPN, tweeted a request for EA Sports to bring back the successful NCAA Football video game franchise. His tweet has already received more than 56,000 likes.

The NCAA Football video game franchise was very popular and had a loyal consumer base up until it was canceled in 2014. In fact, NCAA Football was one of the top-selling games produced by EA Sports. Unfortunately, EA Sports had to pull the plug on the franchise in the wake of the Ninth Circuit’s decision in In re NCAA Student-Athlete Name & Likeness and the Third Circuit’s decision in Hart v. Electronic Arts, Inc. Both of those cases involved publicity right challenges to EA Sports’ use of college athlete NILs in the video games without paying the athletes for that use. The right of publicity is a civil remedy that protects celebrities in their control over the commercial use of their NILs. In both cases, the courts found that college athlete publicity rights were implicated in the NCAA Football video games, but that recognition has little influence when the NCAA’s policy prohibits athletes from profiting off of any commercial use of their NILs.

So can the popular game come back now that the NCAA has lifted the ban on athlete use of NILs? As Herbstreit’s College Football GameDay partner Lee Corso likes to say- not so fast my friend!

The possibility that the beloved game could return exists, but some NCAA-imposed barriers might prevent that from happening. In Tuesday’s press release the NCAA stated that any new NIL policy will ensure “that compensation for athletic performance or participation is impermissible.” That mandate may complicate the game’s revival if the NCAA interprets “participation” to include athletes being compensated for any activity that references their participation in intercollegiate athletics.

For example, Arike Ogunbowale was the first active NCAA athlete permitted to participate in the popular ABC reality show Dancing With the Stars. The NCAA granted the Notre Dame basketball player a waiver to participate on the show despite the fact that doing so would permit her to benefit from the use of her newfound celebrity. The NCAA granted her release under the illogical pretense that her participation on the show had absolutely nothing to do with either her “basketball abilities” or the fact that she was the two-time the buzzer-beating star of the 2018 NCAA Division I Women’s Basketball Tournament.

The NCAA’s interpretation of participation in the Ogunbowale example could prove problematic for those of us who want to see the NCAA Football games resurrected. The reason for this that the NCAA will not be able to pretend that athlete involvement in the commercial production of the video games has nothing to do with their football abilities. Whereas in Ogunbowale’s example, the NCAA could suspend its disbelief because she was dancing rather than playing basketball (or allowing an avatar of herself to play basketball in a video game).

Keep in mind that the NCAA more than tolerates the use of athlete NILs in commercial telecasts of collegiate games. So the NCAA is fine with commercial uses of athlete NILs, just so long as the production does not result in NCAA athletes being compensated. That is the real reason why the NCAA Football games no longer exist and that reason persists despite the NCAA’s apparent change in NIL policy.

Will Athletes Be Permitted To Secure Endorsements?

The NCAA’s press release states that athletes will be permitted to benefit from the use of their NILs in a manner consistent with the collegiate model. The problem with the collegiate model caveat is that it may be interpreted to limit athletes from serving as brand endorsers. After all, the NCAA’s collegiate model currently only allows athletes to endorse the NCAA, its member institutions and the branding partners in licensing agreements with NCAA institutions (e.g. Nike).

The NCAA has no problem with athletes taking to fields, courts and diamonds while adorned with the Nike swoosh. The NCAA is also perfectly fine that the athletic programs and their coaches being compensated for doing the same while the players are not. But there is some question as to whether the NCAA’s new NIL policy will extend to permit athletes from seeking out their own sponsors. If so, will athletes be permitted to sponsor sports brands? And if that is permitted, will athletes be allowed to endorse sport brands that compete directly with the brands that have already partnered with the athlete’s member institution?

California’s Fair Pay to Play Act has answers to those questions and will be the law in that state in 2023. The Act prohibits schools in the state from enforcing rules that deny college athletes the opportunities to profit from their NILs. The rule also authorizes college athletes in the state to retain agents to help them identify and negotiate for commercial opportunities to use their NILs. California’s new law, however, includes the limitation that athletes can’t endorse brands that compete with school sponsorships. For example, if the athlete is at school that has a sponsorship relationship with Nike then that athlete would not be able to endorse Adidas.

So is the NCAA is now forced to fit its new NIL regime to match California’s law? Or will the NCAA go bold and roll out rules that are more restrictive than California’s?

Until the NCAA unveils its new NIL rules for 2021 we will not know the answers to those questions and how the new NIL policy will influence the other issues discussed in this article. The language used in the NCAA’s press release gives good reason for both optimism and skepticism. Needless to say, those who are interested in the NCAA’s version of intercollegiate athletics will have some important issues to monitor both before and after the new NIL rules are released.