NCAA takes big step toward allowing name, image and likeness compensation for athletes
College athletes may be able to begin cashing in on their name, image and likeness soon. A significant development occurred Tuesday as the NCAA Board of Governors supported proposed rule changes from a working group to allow athletes to take advantage of these rights. In other words, athletes could soon receive compensation for third-party endorsements, social media influence, personal appearances and their own businesses — all for the first time.
When adopted in the future, the new rules will drastically change the landscape of college sports. The recommendations will be considered by the NCAA’s three divisions before legislation is drafted. Rules are expected to be written by Oct. 31 with a vote occurring no later than Jan. 31, 2021. Name, image and likeness rights would be in effect for the 2021-22 athletic season.
One catch to the new name, image and likeness rights is that athletes, while permitted to cash in personally and identify themselves as participants in their respective sports, would be unable to utilize conference or school logos or trademarks in promotions. It was also stressed by the NCAA board that member institutions do not need to pay athletes to utilize their name, image and likeness.
“Throughout our efforts to enhance support for college athletes, the NCAA has relied upon considerable feedback from and the engagement of our members, including numerous student-athletes, from all three divisions,” said Michael V. Drake, chair of the board and president of Ohio State, in an NCAA statement. “Allowing promotions and third-party endorsements is uncharted territory.”
How athletes could be paid
- Third-party endorsements, such as promoting a product or service on television, radio or in advertisements
- Social media influencing, such as modeling or promoting a product or service in exchange for samples or compensation through Twitter, Instagram, TikTok, Facebook, etc.
- Their own work product or business activities, including digital content creation (podcasts, YouTube videos, streaming video games with monetization via advertisements, paywalls, etc.), utilization of talents (athletic lessons), music, art, etc.
- Personal promotions like autograph signings or meet and greets
- Athletes or third parties cannot use a intellectual property (logos, trademarks) from school or conferences in endorsements
- Schools or conferences cannot make endorsement payments themselves
- Schools or conferences cannot facilitate or help athletes locate or arrange endorsements
- Schools cannot use — or allow boosters to use — endorsements as a means of paying for enrollment or participation in athletics
- Among the name, image and likeness restrictions are protection around “pay for play” — providing money to athletes either to play (or for their successful actions) at a specific school — as well as no endorsement funds coming from schools or conferences, no use of NIL “for recruiting by schools or boosters” and additional regulation of agents and advisors in the process.
Legal pressures have been mounting over the last decade as players began to realize how valuable their brands can be while they are still in college. The popularity of college football and college basketball — specifically — has turned star athletes into potential marketing machines who have been unable to profit off of their success due to NCAA rules.
These principles rules that were furthered on Tuesday would allow athletes to cash in on their stardom while maintaining their eligibility.
- Ensuring student-athletes are treated similarly to nonathlete students unless a compelling reason exists to differentiate.
- Maintaining the priorities of education and the collegiate experience to provide opportunities for student-athlete success.
- Ensuring rules are transparent, focused and enforceable, and facilitating fair and balanced competition.
- Making clear the distinction between collegiate and professional opportunities.
- Making clear that compensation for athletics performance or participation is impermissible.
- Reaffirming that student-athletes are students first and not employees of the university.
- Enhancing principles of diversity, inclusion and gender equity.
- Protecting the recruiting environment and prohibiting inducements to select, remain at or transfer to a specific institution.
The NCAA also announced it plans to continue engaging Congress in the issue as it hopes to create federal name, image and likeness legislation in order to preempt state laws that have already been passed. This would include the NCAA having a “safe harbor” for protection against NIL lawsuits and college athletes still being considered non-employees who are distinct from professional athletes.
“The evolving legal and legislative landscape around these issues not only could undermine college sports as a part of higher education but also significantly limit the NCAA’s ability to meet the needs of college athletes moving forward,” Drake said in a statement. “We must continue to engage with Congress in order to secure the appropriate legal and legislative framework to modernize our rules around name, image and likeness. We will do so in a way that underscores the Association’s mission to oversee and protect college athletics and college athletes on a national scale.”
The most obvious question is how NIL will be regulated, including preventing under-the-table payments beyond the registered endorsement deals. If the NCAA is going to allow marketing agents and advisors to participate, how does it intend to differentiate them from athletic agents that will be salivating for clients upon graduation? Sure, marking agencies might technically be different firms, but it would be naive to think they won’t form partnerships with agencies and steer players to specific agents after college.
A massive overhaul will also be necessary inside the walls of athletic departments. Compliance departments around the country are well-staffed but changing their duties to include new marketing oversight rules and responsibilities will be a tall task considering how drastically the rule book will have to change in order to implement these recommendations.
There are a lot of questions on the horizon as the NCAA continues to look for answers.