Paying College Athletes/Letting Them Get Endorsements

[2 For The Brew]

Is he saying direct payments will replace NiL? Because I don't see that happening pretty much ever. It's a completely different source of funding, and despite goofy Nick Saban thinking that NiL revenue should be shared among different teams, it will remain the way for boosters to attract players to their own school. No way boosters are going to contribute to NiL if that money is going to teams other than their own.

There are some huge issues with direct payments over and above scholarships/stipends - not to mention Title IX implications - but I suppose we'll see. I'm skeptical that schools will do it to a significant degree because of the cost/internal politics at schools. Most academic leadership/deans are not going to want to spend more general university money to pay student athletes, nor should they. So that means it most likely would be limited to the dozen or so schools whose athletic department are in the black and that can therefore self-finance the payments.

I thought his comment that “there will be a line item in our budgets for student-athletes” and “it is not optional” was incredibly arrogant, ignorant and presumptuous.

No university is obligates to pay its athletes. If that’s eventually a mandate some schools with opt out with some or even all of their sports programs. Athletics does not have an ironclad right to money. Nor does any other school program. Universities can and do cut academic and athletic programs for all sorts of reasons.

Flat statements like these in a rapidly changing era of high legal uncertainty are risible. What’s more likely for sports programs like Ohio State and Alabama are not necessarily valid for less successful programs.

 

[The Human Q-Tip]

I thought his comment that “there will be a line item in our budgets for student-athletes” and “it is not optional” was incredibly arrogant, ignorant and presumptuous.

No university is obligates to pay its athletes. If that’s eventually a mandate some schools with opt out with some or even all of their sports programs. Athletics does not have an ironclad right to money. Nor does any other school program. Universities can and do cut academic and athletic programs for all sorts of reasons.

Flat statements like these in a rapidly changing era of high legal uncertainty are risible. What’s more likely for sports programs like Ohio State and Alabama are not necessarily valid for less successful programs.

I think it is unlikely that he has been authorized to speak for the University of Nebraska as a whole, so this is just his opinion as AD. When schools are forced to cut back on expenditures, it's going to be tough to convince Boards of Trustees to pour more money into the Athletic Department.

 

[2 For The Brew]

I think it is unlikely that he has been authorized to speak for the University of Nebraska as a whole, so this is just his opinion as AD. When schools are forced to cut back on expenditures, it's going to be tough to convince Boards of Trustees to pour more money into the Athletic Department.

Exactly, which is why I said the comment was arrogant, ignorant and presumptuous. Not the kind of statement that will endear you to the widen university community.

 

[AZ_]

“The current model for governing and managing college athletics is dead,” Syracuse chancellor Kent Syverud told The Athletic during an interview.

West Virginia president Gordon Gee added, “We are in an existential crisis.”

Syverud and Gee are part of CST, a 20-person group which also includes the NFL’s No. 2 executive Brian Rolapp, Philadelphia 76ers owner David Blitzer and lead organizer Len Perna of TurnkeyZRG, the search firm that places nearly all the top conference commissioners, including recently the Big Ten’s Tony Petitti.

They are trying to implement a drastically new system that would replace the NCAA and the College Football Playoff and potentially provide a solution for the hurricane of current and future lawsuits aimed at the business of the sport, plus the NIL and transfer portal issues that, they believe, have put college athletics as a whole in peril.

The current CST outline would create a system that would have the top 70 programs — all members of the five former major conferences, plus Notre Dame and new ACC member SMU — as permanent members and encompass all 130-plus FBS universities.

The perpetual members would be in seven 10-team divisions, joined by an eighth division of teams that would be promoted from the second tier.

The 50-plus second-division teams would have the opportunity to compete their way into the upper division, creating a promotion system similar to the structure in European football leagues. The 70 permanent teams would never be in danger of moving down, while the second division would have the incentive of promotion and relegation.

The playoffs would not require a selection committee, as the eight division winners and eight wild cards from the top tier would go to the postseason. The wild-card spots would be determined by record and tiebreakers, much like the NFL.

CST borrows ideas from leagues like the NFL, Premier League and MLS to create a system that they believe would bring more television value and sustainability. Not coincidentally, some of its most influential members have direct ties to those leagues.

Thus far, the group is struggling to gain traction with the schools that would play in their proposed “Super League.” The ACC board of directors heard a presentation from the group in February. However, planned dinners with administrators from the Big Ten, SEC and Big 12 all were called off. Spokespersons for the Big Ten and SEC said commissioners Petitti and Greg Sankey, respectively, have not met with Perna’s group.

Leagues have been hesitant and canceled meetings so as not to upset their current broadcast partners, including ESPN and Fox, according to one executive briefed on the commissioners’ thoughts.

Chief among the obstacles this new venture faces are the billions of dollars in TV deals that all the top conferences have locked in with the major networks: ESPN/ABC, Fox, NBC and CBS. The FBS conferences recently signed off on a six-year, $7.8 billion extension with ESPN for the exclusive rights to the expanded College Football Playoff.

The Big Ten’s deals run through the 2029-30 season, the Big 12’s run through 2030-31 and the SEC’s exclusive deal with ESPN runs through 2033-34. One TV executive called the idea that there is a lot more untapped money in the market “naive.” One CST executive said that the major networks with existing deals would likely need to buy into the plan before it could go to the open market in the 2030s.

Universities would own a percentage of the league, a model derived from MLS where it was devised by former president Mark Abbott, who is involved with CST. Unlike the soccer league, the revenue distribution would not be an even split among all competitors, as top brands like Alabama and Notre Dame would receive more of the financial pie. CST believes there would be added value in negotiating TV deals as one entity and creating broadcast windows that make more sense, much like the NFL’s approach.

“The only way to solve the problem is to have a solution that is legally defensible, politically acceptable, commercially prudent and is able to strike a partnership with student athletes in a way that’s really good for them,” Perna told The Athletic.

College administrators are particularly concerned about the House v. NCAA class-action suit in Northern California, seeking NIL revenue denied to athletes prior to 2021 rule changes. If the plaintiffs are successful, the NCAA and the power conferences could be on the hook for billions in damages. The House case is one of several potentially crippling federal antitrust suits related to athlete employment rights and NIL compensation.

“I really think conferences in the NCAA are at a very significant likelihood of going bankrupt in the near future because of the lawsuits, both the ones that are going to trial soon and those that will follow,” Syverud said.

Perna started on the project three years ago and is viewed as its figurehead. He is well-connected in college sports through his role at Turnkey.

According to two executives briefed on the proposal, one reason the FBS commissioners last month self-imposed a March 15 deadline to approve the six-year College Football Playoff extension was to stave off CST’s push. During The Athletic’s reporting, executives involved in college football were inquiring, “What do you know about the Perna/Rolapp group?” They conveyed alarm about what could be formulated, along with doubt as to why this group would be the one to solve the complex issues facing the NCAA.

Multiple prominent college leaders in recent months have spoken bluntly about a future in which schools directly pay their players. Private equity funding could provide schools an influx of capital to address those legal matters and competitively compensate their athletes, in return for a stake in the schools’ athletics business.

One top college football administrator claimed CST is trying to “buy college football.” CST countered that it is only trying to create a system for football that in turn would result in the finances needed for non-revenue-generating sports to survive and thrive. Under the plans, the non-football sports would stay in their current conference structure.

“Athletes need to be paid and are going to be paid,” Syverud said. “Most of the rules against paying athletes, including some of those that are still in place, are likely to fall in the courts. We’re going to need to sustain women’s sports, Olympic sports and we’re going to have to have competitive equity and some methods to have a labor structure that is sensible. For all that, I think you need a more centralized national college league.”

 

[The Human Q-Tip]

Maybe bankruptcy of the NCAA is a legitimate possibility - I really don't know. Maybe what they're describing is a better playoff system - I don't know that either. But what I do know is that this is a pipedream:

“The only way to solve the problem is to have a solution that is legally defensible, politically acceptable, commercially prudent and is able to strike a partnership with student athletes in a way that’s really good for them,” Perna told The Athletic.

What is "legally defensible" is undeterminable because the governing law - antitrust, labor standards, wage and hour, etc., was not written with college athletics in mind. The interpretation of that law when applied to college sports is ambiguous and subject to varying interpretations that have changed over time, and are certain to continue changing over time. What was legally defensible 10 years ago isn't legally defensible today, and what is legally defensible today not only is unknown, but is certain to change again over the next decade.

The reason that is an issue is the tremendous potential monetary damages some future jury could award based on a structure that the schools, etc. believed was "legally defensible" at the time.

Best thing that could happen in terms of resolving all of this is for the NCAA to suffer a huge loss and go bankrupt. Because to be honest, I think its basic existence/operation is inevitably going to be found to be monopolistic. The lawsuits will never end unless the NCAA removes itself completely from attempting to limit student compensation or transfers of any kind, and made it all unrestricted/unregulated.

I suppose the conferences and schools could be sued as well on other grounds, but at least eliminating the NCAA greatly reduces the risk of antitrust claims.

 

[2 For The Brew]

Antitrust law is ridiculously ambiguous. Just ask Donald Trump who along with his fellow USFL owners won an antitrust case against the NFL and were awarded $1 by a jury - trebled to $3.