I wanted to start this off by saying I had a much longer written piece that I’ve split into two parts. Mostly because, I’m overly wordy and I want to separate it into two distinctly different pieces— one centered mostly around facts and the other with mostly my opinion. It’s important to distinguish the two because in my career I’ve had several interesting perspectives on the sport that have led me to become friends with people who are way smarter than me. This also allows me to speak under the guise of anonymity without blowing up people and programs. I always want my opinion to be stated clearly as to not allow any ambiguity to people who read these posts. 

This piece will specifically deal with the recent Supreme Court ruling, the NIL bonanza, and what it all really means. 

 

Court Precedents and the NCAA

Tarkanian vs. NCAA, Board of Regents vs. NCAA, Law vs. NCAA, and White vs. NCAA

I won’t go into details into all of these cases, but if you want to understand why college football is where it is today these cases are critical. If you have some free time I would read the Justices' opinions in these cases, as it helps understand the college sports roadmap.

The NCAA has been taking L’s in court for a long time, and it often doesn’t change its rules until it is forced to by the courts. College football became a business after NCAA vs. Board of Regents in 1984. Once TV money came pouring in, every decision has been made to protect the cash coming in from TV rights deals.

The NCAA isn’t this monolithic cabal sitting up in Indianapolis counting their pool of money. It’s a front for college presidents and athletic directors. Mark Emmert is a former College President taking all the heat for the other current Presidents, in exchange for some cash. The Board is made up of school Presidents from Wisconsin and Georgia and Athletic Directors. All of the money gets distributed to the schools (minus staff salaries, and NCAA operating costs) and the colleges are the ones who are intent on making sure that money keeps flowing in.

The Board of Regents case was the single most important ruling for the NCAA, even though it was a case they lost. They believed that if they could prove the rules they set are related to its mission to promote amateur, collegiate athletics, then it isn't considered a restraint of trade and in violation of anti-trust laws. Why this is so important is that for every subsequent legal challenge the NCAA has argued under the veil of amateurism. However, now this ruling has made it very clear that the 1984 case didn't provide a precedent, nor did it provide anti-trust exemptions. In summation, the NCAA lost in a big, big way here. 

The NCAA knows this, Colleges know this, and that’s why they’ve been dragging their feet on the NIL legislation. They were waiting to see what the courts ruled. Now they know that they will react appropriately, and by that I mean they will dangle their new NIL rules as the silver bullet to solve all their problems. Just wait and see the puff pieces from NCAA-friendly journalists going to be coming out in the next 6 months. 

Now, with that being said I want to clarify what the ruling says. It’s a purposefully narrow ruling. It deals specifically with additional benefits and payments related to educational components of the scholarship. It doesn’t open it up to direct payments to players. The Justices specifically mentioned that it does not open that door. It only deals with additional “educational benefits.” The ruling states the NCAA can lawfully forbid in-kind benefits that are “unrelated to a student’s actual education aka pay-to-play.

I’ve heard a lot about Kavanaugh’s concurring opinion and this is just my opinion in talking with folks who are very smart and are qualified to speak to these such things. It felt like a little bit of Kavanaugh swinging on a 3-0 fastball when they were up 16-0 in the 9th inning. Sure it feels great, but in the grand scheme of things, it doesn’t mean a whole lot. Said a different way, homie took to the Supreme Court blogosphere to score some public perception points on a topic that almost everyone would agree upon. No other judges signed that opinion because they wanted their narrow interpretation to stand and if they wanted to blow this whole thing up like Kavanaugh stated they could have.

Ok now that we’ve gotten all of that fun stuff out of the way, let’s get down to the nitty-gritty here.

 

Effects on Recruiting

Anyone that has read any of my posts before knows I have some strong opinions on this. I want to make this point abundantly clear. These rules are not going to drastically shift the college recruiting landscape. It’s not possible for Alabama, Clemson, or OSU to recruit any better than they already are right now. A lot of the hand wringing over this is much ado about nothing. If anything it could provide an opportunity to level the playing field a little bit more. It will have an impact on probably 10-25% of the Top 100 players in my opinion. Meaning, there are 10 - 25 players who would attend a school other than a top 5 school all things being equal. IE) a 5-star attending Washington instead of OSU or Alabama. 

Now, if the rules were to change and schools were to be made known that any payments that aren’t above board will actually be enforced and punished I would change my tune. But that ain’t happening.

It will help programs like Michigan, Notre Dame, Stanford, etc who don’t operate in college football’s grey area to sign a few more 5-star kids. But it’s not going to vault them over Alabama and UGA in the recruiting rankings. 

 

Multi-Million Dollar Student-Athletes?

I also want to make this very clear. We should all be for college kids getting paid their fair market value. Some already are, but a lot aren’t. This idea that people are going to stop watching if they know players are getting paid is ludicrous. Alabama vs. LSU is always one of the highest watched games of the year. 

The NIL rules at least allows players to make greater than $0, which I think we all agree is well deserved. But this is going to change the game in other ways that I don’t think most folks are going to realize. I’ll get into this more in my Part II post later in the week. I do worry that there aren't guard rails in place to protect these players, who at 18 years old are ripe to be taken advantage in ways more than they already are right now. 

This is the biggest refrain I’ve heard from current and former NFL players. They are happy that college guys can finally take advantage of this-- like very happy and think it's long overdue. But they are also concerned that there are going to be a whole lot of people who get their hooks into guys at a young age and aren’t going to be getting the best advice. Everyone is going to want their cut, when the pie may not be as big as people think it is. I feel for these guys because I don’t think the casual fan realizes when they go pro, how often they are hit up by family members, agents, or people who are looking to get cut into deals. It’s stressful and I can’t imagine being an 18-year-old kid who is supposed to be balancing school, football, and building my brand.

 

Sharks in the Water

There are a lot of white-collar sharks in the water, and they are absolutely smelling blood. A few friends and I have been having a great chuckle at all these “NIL specialized companies” that have popped up out of nowhere. Or tech companies that have pivoted to “help colleges navigate the murky waters of NIL.” It’s one giant verbal diarrhea of corporate speak. 

These NIL specialized companies aren’t altruistic— they are going to be as profit-maximizing as possible. They are going to focus on the top guys that can make them money and disregard the rest. If they only represent 10 schools, that’s over 1,000 football players alone. There’s no way that 98% of these kids are going to receive any time or attention other than hey kid here’s a seminar or a best practices guide that they send out to everyone. This speaks to the issue that who do they go to get the right guidance if a school farms this out to a third party?

Schools just aren’t equipped to handle all of this. They’ve been conditioned to keep agents, handlers, etc out of the building for 30 years, but now they are going to work hand-in-hand with building the brands of every single one of their athletes? Some staffers I’ve talked across the country have absolutely no idea how they are going to manage all of this. They have plans in place, but it’s all completely hypothetical right now. 

 

The Issues that can arise

These are things that I just think aren’t being discussed or people are even aware of when framing these discussions. Again, not a reason to not move forward with the NIL rights, but in the case of NFL players, they have a union that can ultimately help and protect the athletes. Where does a college kid turn to when one of these issues pops up?

Whose job is it to make sure that the players aren’t being taken advantage of; whose job is it to make sure there’s some level of remediations if and when problems occur, and ultimately whose in charge of the rules and enforcement here? 

What happens if the player gets in trouble and has his deals pulled? Mortal turpitude clauses are in almost every single brand deal after the Ray Rice fiasco. Hopefully, his agent has a lawyer that can help assist in those issues. 

You also have to remember that players can only use their likeness, not the school’s IP. So Cade McNamara can’t do a video shoot with a brand wearing Michigan gear or even say hey I’m Cade McNamara, Michigan’s starting QB. Unless the school has granted the rights to the brand to do so and spoiler alert they are only going to do that to existing brands that sponsor the team. This also limits the amount of money that they can truly make. 

All of this is to say that I think on paper this looks great to say hey let’s let these kids rightfully earn some money off using their likeness. But in reality, no one has any idea of how to pull this off. You’re bringing outside influence in agents and handlers that you won't be able to rein in as soon as they get involved. It's the classic fox in the hen house example.

For your top 5 guys— the Trevor Lawrence’s, the Zach Wilson’s, the Devonta Smith’s this is going to be awesome. They are going to profit significantly from this. But for the rest of the guys on the roster, there’s not going to be making as much money in this that they think. I keep hearing the example of the local car dealership throwing out a ton of money for guys to get them to do commercials. Have you ever stepped foot in a dealership? These guys aren’t in the business of throwing out money. 

Now, I think guys will be able to take full advantage of getting free stuff, which is awesome for them! Heck, maybe the dealership will give them a loaner car in exchange for the commercial shoot. This is all a net positive in my opinion, but this isn’t going to be a situation where you got 40 guys on a roster making $20k a year doing deals.

To contextualize what I am talking about, let’s look at this example:

$10k deal from a brand 

10-15% is going to go to the online platform that the schools use (they will often say this is passed along to the brand, but the reality is that it ultimately comes out of the player’s pot)

20% agent/marketing manager fee

So all of a sudden that $10k shrinks to $7k and that’s before taxes are taken into consideration. Again 30% of something is a hell of a lot better than nothing. And this is a deal that’s going to be on the higher end. Most deals I would venture into are going to be in the hundreds of dollars. This means to make any money at all, it’s going to require a lot of time and effort from these players. 

Which brings me to my ultimate point with all of this— how the hell are these players going to have time to do all of this? Something has to give here. For players to take full advantage of this, they are going to have dedicated time in their schedule. The time demands on these guys are just too great. You can’t be a full-time football player, college student, and influencer at the same time. 

 

Summary

I don't think this is the panacea that everyone is expecting. It’s going to take a few years to figure out how to manage these rules. And I think it’s overall a net-positive, but there’s going to be some very awkward moments and snafus. 

The top 2-3 guys on a team will make a lot of money, 5-10 guys will make some money, a few others might make a couple of hundred bucks, and most of the roster isn’t going to make much of anything. My preferred way of doing this would be to give every scholarship football player the same $20k check from a large pooling of NIL money rather than individual players getting paid market value. I just feel like this would have a way better impact on a larger group of people, but I also can understand the frustrations with such a system.

I'll do my best to answer any questions in the comments below.