Today’s guest columnist is Tom McMillen, president and CEO of the LEAD1 Association, which represents the athletics directors of the 130 member universities of the Football Bowl Subdivision.
Rarely is there an issue on which almost all our Football Bowl Subdivision (FBS) athletics directors agree. But recently we polled our ADs, and 90% expressed concern that name, image and likeness payments from NIL collectives are being used as improper recruiting inducements, both for high school athletes and/or college transfers.
The NCAA’s Interim NIL policy, implemented on July 1, 2021, spelled out three main rules, including 1. no pay for play; 2. no recruiting inducements; and 3. that NIL agreements require quid pro quo relationships (student-athlete service for compensation).
But in the year that has followed, all these principles have been violated across the college sports landscape. In essence, the NCAA’s Interim NIL policy is like a jaywalking law, a policy on the books that’s not being enforced.
So how did we get here? The conventional wisdom from the very beginning of NIL was that schools must not be involved in NIL activities. This led to many states passing NIL laws, which prohibited athletics department involvement or facilitation.
In turn, this has spawned the creation of NIL collectives, which are funds usually made up of boosters to benefit a specific college or team, but not directly connected to that college or team. While most boosters are well-intentioned, the evolution of collectives has resulted in a new and uncontrolled arms race over talent.
The right solution all along would have been to let athletics departments, which boast extensive compliance offices, oversee student-athlete NIL activities. Our schools fully support NIL rights, and they can use their robust resources to ensure compliance while also helping athletes maximize their opportunities.
Recruiting under the present NIL marketplace is untenable, as we are on a path where the best players will almost always gravitate towards those with the biggest budgets.
Recruiting in college sports must be fair and equitable, because talent is allocated through recruiting. By contrast, professional sports enterprises understand the importance of parity and have mechanisms to allocate their talent such as drafts and salary caps.
Whether it is Cincinnati advancing to the College Football Playoff or No. 15-seeded Saint Peter’s advancing to the Elite Eight in the NCAA Men’s Basketball Tournament, the concept of Cinderella winners is an important part of college sports, one which may no longer exist if student-athletes simply choose to go to the highest spender.
In addition to creating an unstable recruiting landscape, another issue with having boosters leading NIL is that they are not compelled to cooperate in NCAA investigations, and institutions could be culpable for their actions.
There are also inherent conflicts with NIL being administered outside of an athletics department. For instance, a collective may pursue a star quarterback, but the head football coach may not be interested in that player.
Additionally, in this unregulated marketplace, bad deals may be consummated some with onerous provisions where students could be contracting away their future rights, including the right to transfer. This is especially problematic given that according to Opendorse, only about 10 percent of college athletes have agents or professional representation for NIL agreements.
Fortunately, more states like Illinois and Tennessee are modifying their existing NIL laws to lift facilitation restrictions for athletics departments to be more involved (and others should, as well). A model that allows athletics departments and college athletes to work closely together on NIL will create greater opportunities for both.
For instance, according to The Brandr Group, more than 50% of all licensed consumer products sold in professional sports are cobranded player NIL and team intellectual property, and in some categories with certain leagues it gets as high as 70%. As such, group licensing involving both the institution and athletes is the low-hanging fruit of NIL, because it incorporates all athletes and does not take much time to execute.
In contrast to collectives, another benefit of having institutions more directly involved in NIL is that athletics departments are required to comply with Title IX, which will provide equitable resources for both men and women student-athletes. This will ensure that all college athletes have the opportunities and resources to maximize their publicity rights.
Athletic participation is merely one component of an overall mission to provide thousands of young men and women with a holistic higher-education experience. Athletics departments have long been involved in every other aspect of a college athlete’s life, from internship and career guidance to academic support, so now is the time for schools to allocate existing resources or retain new ones to help student-athletes navigate the new frontier of NIL.
It would be hard to imagine the NBA or NFL allowing its athletes to be under the control of boosters. It should not be that way in college sports, either.
McMillen is a former Congressman, college basketball All-American, Rhodes Scholar and NBA player, who took over LEAD1 in 2015.