OT More on the Brave New World of NIL

[wizenheimer]

I don't know how many are paying attention to the changing landscape of NCAA sports and the impact of NIL (and the transfer portal), but there is some recent big news

Nico Iamaleava is a 5-star QB recruit in the 2023 class. About 3 weeks ago he was considered a strong lean to go to the Ducks. Then, he had a visit to Tennessee and things changed dramatically. Suddenly, all the crystal balls predicted he's sign with Tennessee. What happened?

well, it turns out, apparently, that a collective of donors and businesses favoring the Vols offered Nico a 3-year/8M contract (after 3 years he's eligible for the NFL).

on the Stewart Mandell podcast, they go into the deals of the contract and talk about these 3rd party collectives that are springing up around all the larger schools. Oregon has their own called 'Division Street'.

https://podcasts.apple.com/us/podca...-college-football/id884362991?i=1000554039359

anyway, these 3rd party collectives are not supposed to 'induce' a recruit to any specific school. The easy fix is to simply not mention the school in the contract. So then, what would keep the recruit from taking the up-front money and signing with another school? Well, there's another easy fix for that and it's present in Iamaleava's contract: he has given that collective exclusive rights to his NIL for the duration of the contract, and that 3rd party has a legal right to freeze his NIL for "reasons". In other words, Iamaleava would not have any NIL opportunity at any other school if he wanted to transfer....he signed that away.

pretty obviously, this is a new frontier. We don't know yet what will be legal and what will be illegal. We do know that contracts are binding and a recruit will have a hard time breaking a contract if the contract itself is a legal document. Iamaleava has effectively traded his 3 year future for 8 million dollars. That's a lot of money to be sure, and the guarantee of 8M is awfully attractive to a player, and family, that doesn't really know what the long term future is

on the podcast they talk about a lot of interesting factors surrounding NIL. For instance, in the case of Iamaleava, what if the coaching staff decides he isn't ready to start at QB his freshman season? or his 2nd season? Will the coaches be free to make that decision or will that collective use their leverage to force the coaching staff to play a QB that isn't ready because of that 8M contract?

another factor: If Iamaleava gets paid 350K immediately for signing this contract, will the California Interscholastic Federation declare him ineligible for his senior season? If they do, will that survive legal challenge? If it does, will NIL then start reaching down to the high school level?

 

[handiman]

I'm not sure whether I blame the talking heads or social media more for pushing this change, but the NCAA was right to mostly keep the money out of college athletes' hands. It didn't take a rocket scientist to see how quickly this would turn bad. If someone doesn't value free tuition and all the athletic dept perks as sufficient compensation for their time there, then they shouldn't be in the collegiate athletic system.

 

[Natebishop3]

I don't know how many are paying attention to the changing landscape of NCAA sports and the impact of NIL (and the transfer portal), but there is some recent big news

Nico Iamaleava is a 5-star QB recruit in the 2023 class. About 3 weeks ago he was considered a strong lean to go to the Ducks. Then, he had a visit to Tennessee and things changed dramatically. Suddenly, all the crystal balls predicted he's sign with Tennessee. What happened?

well, it turns out, apparently, that a collective of donors and businesses favoring the Vols offered Nico a 3-year/8M contract (after 3 years he's eligible for the NFL).

on the Stewart Mandell podcast, they go into the deals of the contract and talk about these 3rd party collectives that are springing up around all the larger schools. Oregon has their own called 'Division Street'.

https://podcasts.apple.com/us/podca...-college-football/id884362991?i=1000554039359

anyway, these 3rd party collectives are not supposed to 'induce' a recruit to any specific school. The easy fix is to simply not mention the school in the contract. So then, what would keep the recruit from taking the up-front money and signing with another school? Well, there's another easy fix for that and it's present in Iamaleava's contract: he has given that collective exclusive rights to his NIL for the duration of the contract, and that 3rd party has a legal right to freeze his NIL for "reasons". In other words, Iamaleava would not have any NIL opportunity at any other school if he wanted to transfer....he signed that away.

pretty obviously, this is a new frontier. We don't know yet what will be legal and what will be illegal. We do know that contracts are binding and a recruit will have a hard time breaking a contract if the contract itself is a legal document. Iamaleava has effectively traded his 3 year future for 8 million dollars. That's a lot of money to be sure, and the guarantee of 8M is awfully attractive to a player, and family, that doesn't really know what the long term future is

on the podcast they talk about a lot of interesting factors surrounding NIL. For instance, in the case of Iamaleava, what if the coaching staff decides he isn't ready to start at QB his freshman season? or his 2nd season? Will the coaches be free to make that decision or will that collective use their leverage to force the coaching staff to play a QB that isn't ready because of that 8M contract?

another factor: If Iamaleava gets paid 350K immediately for signing this contract, will the California Interscholastic Federation declare him ineligible for his senior season? If they do, will that survive legal challenge? If it does, will NIL then start reaching down to the high school level?

This is fucked.

 

[wizenheimer]

I'm not sure whether I blame the talking heads or social media more for pushing this change, but the NCAA was right to mostly keep the money out of college athletes' hands. It didn't take a rocket scientist to see how quickly this would turn bad. If someone doesn't value free tuition and all the athletic dept perks as sufficient compensation for their time there, then they shouldn't be in the collegiate athletic system.

college football was generating billions of dollars in revenue for years in TV contracts and gate receipts. Dozens of coaches were making 2-3M or more. Yet, even factoring tuition (which is something of an illusory benefit), room & board, & medical, college football players were getting less than 5% of that generated revenue (probably less)....and they were the ones generating it

the problem isn't NIL as much as it is an NCAA governing body that couldn't see, or refused to see, the train barreling down the track and didn't install any framework at all to try and set boundaries prior to NIL essentially being declared legal by SCOTUS

 

[SharpesTriumph]

Seems like it would be better if athletes could be paid a fair wage for playing from the college. Then it could be more regulated and rules enforced. Maybe $50k per year. Now I'm not sure the NCAA could even legally try to implement something like that.

But having the prior system of poor athletes not even earning minimum wage and basically banned from getting jobs at even a McDonalds was a bad policy.

It seems like now College Football is going to become a minor league, with players salaries paid by rich mega fans and wealthy donors.

A 19 year old on an $8 million contract doesn't represent the college student body, or college athletes. I'm not in favor of having players paid like this. Or how the salaries could escalate.

Can you imagine a mega star recruit some day earning $20 million when two super wealthy schools are in a bidding war?

Then we have a professor at the school that spent 10 years getting their Ph. D education, massive student debt, teaching hundreds of students, and only making a thousand bucks a week; while their student makes $8+ million. Just doesn't seem right.

 

[wizenheimer]

Seems like it would be better if athletes could be paid a fair wage for playing from the college. Then it could be more regulated and rules enforced. Maybe $50k per year. Now I'm not sure the NCAA could even legally try to implement something like that.

But having the prior system of poor athletes not even earning minimum wage and basically banned from getting jobs at even a McDonalds was a bad policy.

It seems like now College Football is going to become a minor league, with players salaries paid by rich mega fans and wealthy donors.

A 19 year old on an $8 million contract doesn't represent the college student body, or college athletes. I'm not in favor of having players paid like this. Or how the salaries could escalate.

Can you imagine a mega star recruit some day earning $20 million when two super wealthy schools are in a bidding war?

Then we have a professor at the school that spent 10 years getting their Ph. D education, massive student debt, teaching hundreds of students, and only making a thousand bucks a week; while their student makes $8+ million. Just doesn't seem right.

ok....'right' and 'fair' have never been components of free-market capitalism, even when regulated. It's a lousy system but the best we have?

picture the NBA without a CBA. Even with a CBA there are almost no regulations governing what players can earn in endorsement deals. About the only ones I know of pertain to an owner using another company he controls to funnel money to a player. Even then there's a big gray area because the meaning of 'control' can get sliced and diced by lawyers

it's the CBA that at least sets the boundaries for salary and contracts. But there would be no CBA for the NBA, or NFL, or MLB without anti-trust exemptions. The NCAA would have to get an anti-trust exemption before they could even begin to get a handle on this. And all college athletes would have to form a union. And about all member institutions would have to agree to adhere to a proposed CBA and negotiate in good faith with the union(s). Right off the bat, several schools in the SEC would refuse. There's just no way that the NCAA can secure that kind of consensus from the member institutions. In fact, the NCAA may not even qualify to apply for an anti-trust exemption. Are they a private entity considering that most of their member institutions are public universities?

The NCAA was like a driver who never looked in the rear view mirror and was surprised when the truck passed him when he was parked on the side of the road. That NIL truck is so far down the road right now there is no catching up. Individual conferences might have a better chance of imposing some regulations than the NCAA

 

[Pinwheel1]

I feel bad for thinking this, but I hope these players fail. This is NOT the player's fault, but it is the only way I can see the "donors" dialing it back.
Hopefully, these players get banged up" and don't produce in college. I can see them playing it safe until their next big payday in the NFL.

Or better yet I hope it ruins the chemistry of the teams when some are getting paid way more than others. Don't get wrong I want the players to get paid, but the compensation needs to be more evenly dispersed.

How does a coach not start a player when a large donor is paying the player millions? The coach gets paid for winning, but I can see it pissing off the donor.
I don't see this ending well.

 

[SharpesTriumph]

ok....'right' and 'fair' have never been components of free-market capitalism, even when regulated. It's a lousy system but the best we have?

picture the NBA without a CBA. Even with a CBA there are almost no regulations governing what players can earn in endorsement deals. About the only ones I know of pertain to an owner using another company he controls to funnel money to a player. Even then there's a big gray area because the meaning of 'control' can get sliced and diced by lawyers

it's the CBA that at least sets the boundaries for salary and contracts. But there would be no CBA for the NBA, or NFL, or MLB without anti-trust exemptions. The NCAA would have to get an anti-trust exemption before they could even begin to get a handle on this. And all college athletes would have to form a union. And about all member institutions would have to agree to adhere to a proposed CBA and negotiate in good faith with the union(s). Right off the bat, several schools in the SEC would refuse. There's just no way that the NCAA can secure that kind of consensus from the member institutions. In fact, the NCAA may not even qualify to apply for an anti-trust exemption. Are they a private entity considering that most of their member institutions are public universities?

The NCAA was like a driver who never looked in the rear view mirror and was surprised when the truck passed him when he was parked on the side of the road. That NIL truck is so far down the road right now there is no catching up. Individual conferences might have a better chance of imposing some regulations than the NCAA

Good points you make. However; I'd say 'right' and 'fair' are in theory setup with laws to create the framework of rules in our free-market capitalism. Thats why we have minimum wage, and environmental restrictions, and monopoly (anti-trust) rules, price gouging, etc. Not saying all these rules are perfect, but the US system is pretty freaking good by and large, compared to other economic systems in history, or whats going on in Russia, North Korea, etc.

You may be right about the NCAA being too late.

However if enough of the general public really doesn't like this system of players earning multi million deals in college its certainly very possible it could become a popular law to pass on both sides of the aisle, and then there could be some real federal rules put in place.

First we probably will need to have a few years of the wild west where we see a bunch of million dollar college athletes. Then if we have enough public backlash, perhaps there is a movement to create some rules.

 

[SharpesTriumph]

I feel bad for thinking this, but I hope these players fail. This is NOT the player's fault, but it is the only way I can see the "donors" dialing it back.
Hopefully, these players get banged up" and don't produce in college. I can see them playing it safe until their next big payday in the NFL.

Or better yet I hope it ruins the chemistry of the teams when some are getting paid way more than others. Don't get wrong I want the players to get paid, but the compensation needs to be more evenly dispersed.

How does a coach not start a player when a large donor is paying the player millions? The coach gets paid for winning, but I can see it pissing off the donor.
I don't see this ending well.

If you look at one school maybe your hope will happen.

But over many dozens of large colleges and dozens, eventually hundreds of players we're going to see many succeed and many fail. Only takes a couple big examples that win a championship to where this becomes the standard to compete at the highest level.

I think its more or less inevitable that it will happen; until there is enough consensus to actually implement some rules. But as Wiz mentions, that may be very difficult to pass.

 

[Hoopguru]

ok....'right' and 'fair' have never been components of free-market capitalism, even when regulated. It's a lousy system but the best we have?

picture the NBA without a CBA. Even with a CBA there are almost no regulations governing what players can earn in endorsement deals. About the only ones I know of pertain to an owner using another company he controls to funnel money to a player. Even then there's a big gray area because the meaning of 'control' can get sliced and diced by lawyers

it's the CBA that at least sets the boundaries for salary and contracts. But there would be no CBA for the NBA, or NFL, or MLB without anti-trust exemptions. The NCAA would have to get an anti-trust exemption before they could even begin to get a handle on this. And all college athletes would have to form a union. And about all member institutions would have to agree to adhere to a proposed CBA and negotiate in good faith with the union(s). Right off the bat, several schools in the SEC would refuse. There's just no way that the NCAA can secure that kind of consensus from the member institutions. In fact, the NCAA may not even qualify to apply for an anti-trust exemption. Are they a private entity considering that most of their member institutions are public universities?

The NCAA was like a driver who never looked in the rear view mirror and was surprised when the truck passed him when he was parked on the side of the road. That NIL truck is so far down the road right now there is no catching up. Individual conferences might have a better chance of imposing some regulations than the NCAA

I think this eventually the demise of the NCAA and there will be a Super Conference that generates the big bucks with TV contracts and thus become the minor league.

 

[handiman]

college football was generating billions of dollars in revenue for years in TV contracts and gate receipts. Dozens of coaches were making 2-3M or more. Yet, even factoring tuition (which is something of an illusory benefit), room & board, & medical, college football players were getting less than 5% of that generated revenue (probably less)....and they were the ones generating it

That's the common fallacy that has led to this situation. The players don't generate the revenue. The system does. The system needs players in general, but not any specific ones.

The other problem is the big revenue-generating and budget disparity between the various sports, and even the overlooked aspect of how many football programs actually make money ... and the inability of the new rules to account for those disparities. If not all schools and/or sports can afford to pay their athletes as much as others do, then we're way worse off than before.

 

[SharpesTriumph]

That's the common fallacy that has led to this situation. The players don't generate the revenue. The system does. The system needs players in general, but not any specific ones.

The other problem is the big revenue-generating and budget disparity between the various sports, and even the overlooked aspect of how many football programs actually make money ... and the inability of the new rules to account for those disparities. If not all schools and/or sports can afford to pay their athletes as much as others do, then we're way worse off than before.

Agree with much of this. People root and pay for the team on the jersey. If player a, b, c we're gone, fans would just root and pay for player x, y, z.

 

[SharpesTriumph]

If the actual quality of play by both teams in college was NFL level, or high school level, long term I don't think there would be much difference in revenue or fan interest.

 

[wizenheimer]

That's the common fallacy that has led to this situation. The players don't generate the revenue. The system does. The system needs players in general, but not any specific ones.

that seems like saying the NBA would generate the same level of revenue if Drew Eubanks was the best C, Watford was the best PF, and Keon Johnspn was the best guard. It wouldn't of course because Jokic, Giannis, and Morant would be playing in the alternative league. The fallacy is saying the players don't generate the revenue. They absolutely do whether it's the NBA, the NFL or the NCAA. The systems are just the framework, not the primary

people don't tune into college football because Kirk Hebstreit is announcing or Chip Kelly is coaching. They tune in to watch the players, and a lot more will tune in to watch Mariotta or Herbert at QB than if it was Anthony Brown or Tyler Shough

 

[RR7]

If the actual quality of play by both teams in college was NFL level, or high school level, long term I don't think there would be much difference in revenue or fan interest.

The SEC is closest in NCAA we would get to NFL. Sticking with just FBS, let's say the worst is the MAC or sun belt. I wonder what the outcome would be to look up the revenue differences between the two conferences?

 

[wizenheimer]

The SEC is closest in NCAA we would get to NFL. Sticking with just FBS, let's say the worst is the MAC or sun belt. I wonder what the outcome would be to look up the revenue differences between the two conferences?

https://www.sportico.com/business/c...finances-database-intercollegiate-1234646029/

 

[wizenheimer]

However if enough of the general public really doesn't like this system of players earning multi million deals in college its certainly very possible it could become a popular law to pass on both sides of the aisle, and then there could be some real federal rules put in place.

what do you think would happen if Congress passed a law limiting NBA salaries AND endorsement deals to a max of 10 million/year? How quickly would the law be found unconstitutional?

sure looked to me like the SCOTUS ruled that college athletes have the same constitutional rights for NIL compensation as NBA players

 

[wizenheimer]

some related information about the potential power of NIL featuring Oregon's Sedonna Prince who made a viral video last March about the disparity of weight rooms:



ESPN is writing about it:



https://www.espn.com/womens-college...est-gender-equity-ncaa-basketball-tournaments

 

[wizenheimer]

I have no idea what kind of NIL this generates for the athletes

 

[THE HCP]

I have spoke to a few friends of mine who own businesses about sponsoring my daughter once she moves on to college to play. They are considering it actually. Nothing along the lines of these above athletes obviously, but a little something for her. Will be interesting. Already have the paperwork up and running with the NCAA.

 

[Eastoff]

WTF is NIL?

 

[RR7]

WTF is NIL?

Name, Image, Likeness. A ruling to allow NCAA athletes to profit off of their N, I, and L. Basically, they can get advertising and sponsorship deals as individuals.

 

[THE HCP]

WTF is NIL?

College athletes can be legally sponsored.

 

[handiman]

that seems like saying the NBA would generate the same level of revenue if Drew Eubanks was the best C, Watford was the best PF, and Keon Johnspn was the best guard. It wouldn't of course because Jokic, Giannis, and Morant would be playing in the alternative league. The fallacy is saying the players don't generate the revenue. They absolutely do whether it's the NBA, the NFL or the NCAA. The systems are just the framework, not the primary

people don't tune into college football because Kirk Hebstreit is announcing or Chip Kelly is coaching. They tune in to watch the players, and a lot more will tune in to watch Mariotta or Herbert at QB than if it was Anthony Brown or Tyler Shough

Mmm, no. Pro leagues promote and market star individuals. College level is almost entirely about the team. The fact that you had to take the college argument to the pros to make a point tells me that you're trying to tiptoe around what you know to be the truth. For what reason, I'm not sure.

If, as you suggest, and some players like Kyrie have pushed for, a better league develops because players chase better opportunities there, then the equation changes completely.

 

[wizenheimer]

Mmm, no. Pro leagues promote and market star individuals. College level is almost entirely about the team. The fact that you had to take the college argument to the pros to make a point tells me that you're trying to tiptoe around what you know to be the truth. For what reason, I'm not sure.

no

when Oregon was losing games in the 70's & 80's while posting year after year of losing records, Autzen stadium was half full and the Ducks were rarely on TV. When they were winning under Bellotti and Chip Kelly, Autzen was sold out every game; SRO. And they were on TV all the time. Viewers turn in to see good teams and buy tickets to see good teams. And good teams require good players. Good players are the other side of the equation from high attendance and TV ratings. That's because a lot more people will show up and tune in to see Marcus Mariotta lead the team to the national championship game than when Norval Turner is leading the Ducks to a 2-9 record

 

[PtldPlatypus]

no

when Oregon was losing games in the 70's & 80's while posting year after year of losing records, Autzen stadium was half full and the Ducks were rarely on TV. When they were winning under Bellotti and Chip Kelly, Autzen was sold out every game; SRO. And they were on TV all the time. Viewers turn in to see good teams and buy tickets to see good teams. And good teams require good players. Good players are the other side of the equation from high attendance and TV ratings. That's because a lot more people will show up and tune in to see Marcus Mariotta lead the team to the national championship game than when Norval Turner is leading the Ducks to a 2-9 record

We're not talking about individual teams though; we're talking about the organization as a whole. The NBA G-League has a much higher caliber of player than the college game, yet the NCAA garners far more attention and revenue. Why? Because of the institutions. And, I might also add, the real "stars" in the college game are the coaches.

The players, for all intents and purposes, are interchangeable, replaceable, and disposable elements to the college athletics machine.

 

[chris_in_pdx]

another factor: If Iamaleava gets paid 350K immediately for signing this contract, will the California Interscholastic Federation declare him ineligible for his senior season? If they do, will that survive legal challenge? If it does, will NIL then start reaching down to the high school level?

Regarding NIL deals in high school, I would think that 18 year olds cannot enter into legally binding contracts. Perhaps their parents can on their behalf, but if a kid breaks his contractual obligations, it's not on the kid, it's on the parents. Which is yet another legal grey area.

Or, you know, the country could just do away with "amateur athletes" and being tied to educational institutions and create privately-owned Acadamies like other countries do with youth soccer and basketball, where kids are trained and paid while learning and growing.

 

[handiman]

Regarding NIL deals in high school, I would think that 18 year olds cannot enter into legally binding contracts. Perhaps their parents can on their behalf, but if a kid breaks his contractual obligations, it's not on the kid, it's on the parents. Which is yet another legal grey area.

Good line of thought, but you got the cutoff wrong. 18 is when they can enter into legally binding agreements, so virtually all HS seniors would be in the clear.

 

[SharpesTriumph]

that seems like saying the NBA would generate the same level of revenue if Drew Eubanks was the best C, Watford was the best PF, and Keon Johnspn was the best guard. It wouldn't of course because Jokic, Giannis, and Morant would be playing in the alternative league. The fallacy is saying the players don't generate the revenue. They absolutely do whether it's the NBA, the NFL or the NCAA. The systems are just the framework, not the primary

people don't tune into college football because Kirk Hebstreit is announcing or Chip Kelly is coaching. They tune in to watch the players, and a lot more will tune in to watch Mariotta or Herbert at QB than if it was Anthony Brown or Tyler Shough

I don't agree with this in terms of college athletes at all. Fans root for the teams and whatever people on those teams are having the most success. You have donors paying only for their single school, if they can't pay for player x they pay for player y. Donors only pay for their school.

You don't have donors paying for a single player regardless of the school that player chooses, rooting and paying for the player whatever school he goes to. If the best 20 year old players went to the arena league instead of college football your not going to see a big change in revenue of either league.

 

[wizenheimer]

The players, for all intents and purposes, are interchangeable, replaceable, and disposable elements to the college athletics machine.

that's just wrong on a very real level, and you can make the same misleading argument about the pros. How much did attendance drop off for the Blazers when they trotted out lottery teams? This year it's 17,125; in 2018-19 when they won 53 games it was 19,496. That's a 12% drop but that doesn't really tell us anything because of Covid restrictions. In 2016-17 when Portland won 41 games their attendance was 19,318. So, that 2018-19 Blazer team that was 29% better in wins increased attendance by 0.9%.

that isn't the full picture either because in 2012-13 when Portland only won 33 games, their attendance was 19,830. But wait!! the next season when Portland won 54 games their attendance dropped to 19,747. Hmmm...sure looks like the players and wins don't matter in the NBA either. And if you argue that Portland is unique because of the pro-sports market then it means that the players, in the Portland part of the NBA at least, "for all intents and purposes, are interchangeable, replaceable, and disposable elements"

in other words, it sure looks like you're trying to set different goal posts to gauge the value of college players vs pros.

NBA players get what percentage of gross revenue? Is it 50%?

"College football generates more than $4 billion in annual revenue for the 65 universities making up the Power 5, according to data provided to Fortune by Patrick Rishe, director of the sports business program at Washington University in St. Louis. Combined, those schools reaped nearly $1.8 billion in profits from their football programs in 2018"

did the players get 50% of that 4B+ like the NBA? Did they get 48% of that like players in the NFL? Or the 49% that MLB players get? Hell no they didn't and team loyalty in the pros is the same as school loyalty in college

and it's not like the college athletes are suddenly taking a portion of TV revenue, gate receipts, concessions etc. They still don't get any share of that. They have just been allowed to start being compensated for NIL. All that traditional revenue will still be going to all of the greedy shits at the top of the food chain, including all those mercenary coaches you claim are the stars

and LOL at the comparison of the G-League to college. Now, why don't you compare the G-League to the NBA?