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NCAA’s NIL regulations change the game in college sports

The system is still evolving, but it’s clear that the opportunities for college varsity athletes to make outside money off sponsorships comes with reward - and risk.

In the new era of college sports where athletes can make money off their Name, Image and Likeness (NIL), officials have had difficulty trying to put regulations in place, but that appears to finally be changing.

The NCAA Division I council, which is responsible for high-level decision-making in the premier tier of college athletics, approved new rules last month designed at increasing transparency for athletes who sign NIL contracts.

The NCAA will provide a voluntary registry of NIL service providers, effective Aug. 1, such as agents and financial advisors with prior experience in order for athletes to avoid untrustworthy figures. They will also develop an aggregated database, from anonymized data provided by schools, a minimum of twice per year to give a general idea of the standard rates for endorsement deals.

“I presume it’ll be broken down in various ways by gender, by sport, maybe even more specific than that,” said Eric Blevins, the sports law program manager at Tulane University. “Maybe you'll be able to see what quarterbacks you're getting as opposed to just football players.”

Athletes will additionally receive increased education on policies, rules, and best practices for contractual obligations to better prepare them.

The Division I council also proposed a multitude of rules aimed at increasing school support for athletes. One of those rules would require athletes to disclose to their schools agreements they sign worth more than $600.

“There's already over 20 states that require it by law, so I think the rationale from the NCAA’s standpoint is, ‘We need to have this uniform rather than athletes being treated differently just because they go to school in a different state,’” Blevins said.

NCAA President Charlie Baker suggested in December 2023 that the highest earning schools should pay at least half of their athletes a minimum of $30,000 per year through a trust fund. That would almost certainly raise the question of whether college athletes are employees of their institutions.

“You think about organizations being proactive, reactive, or literally being forced, and the NCAA has always been forced to do the right thing,” said Kadence Otto, a sports management professor at Western Carolina University and an expert on NCAA corruption. She said the association’s maneuver is “ridiculous” because they waited as long as possible to take action.

“The Supreme Court in the Alston decision has already made it very clear that they agree the athletes are employees and they're simply waiting for the case to come before them,” she added, referring to the NCAA v. Alston decision in 2021 when the court unanimously ruled that the NCAA was violating anti-trust laws.

Blevins echoed a similar point. He believes that with all the legal challenges facing the NCAA, this could be the most transformative time in the history of college sports.

At least one former college athlete is against direct payments from universities to their students, though. Trent Farquhar played baseball at Michigan State for three seasons where he earned All-Big Ten second-team in 2023.

“I don’t think schools should start paying kids directly because then it turns collegiate athletics into a monopoly where the power five schools will be at a huge advantage in getting talent,” said Farquhar, who signed with the Philadelphia Phillies last summer as an undrafted free agent. He knows part of the fun of the sport comes from the fact that anyone can beat anyone with all the depth teams have in this day and age. He also pointed out how the transfer portal has already given big colleges an upper hand over the mid-major schools.

What all these rules and proposals have in common is their goal to level the playing field for athletes of every sport. Football and men’s basketball players receive the bulk of NIL partnerships right now and a fixed payment from schools could allow the others to get their share.

Farquhar admitted the competition to find partnerships was “pretty tough” as a baseball player.

“We obviously don’t get the same publicity that sports such as basketball or football get, so our name isn’t just out there in the media,” he said. “I had to go and put myself out there, sending emails, DMs and texts to some smaller companies that would potentially benefit from a Big Ten baseball player.”

There’s one other major idea gaining traction in the sphere of college sports: revenue sharing. The topic has been floated around quite a bit, notably with former Michigan football Coach Jim Harbaugh as a big proponent. The vast majority of revenue for college athletics these days comes through multi-billion dollar TV rights contracts and athletes don’t receive a penny of it with the current rules.

“These athletes are going to form a union and they're going to bargain for a fair share,” Otto said. “I don’t think it’ll be long before they get half of the television revenue.”

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