Pros and Cons of Name, Image, and Likeness Deals for College Athletes
John Fritz
On July 1, 2021, the National Collegiate Athletic Association (NCAA) announced that its student-athletes would be able to begin earning compensation for the use of their name, image, and likeness (NIL). This change marked a significant development for the future of college athletics and the NCAA’s definition of amateurism. Previously, student-athletes were forbidden from receiving any form of benefits outside of their scholarships. However, laws in favor of opening NIL opportunities to student-athletes were passed in several states, and these changes put increased pressure on the NCAA to develop a more comprehensive update of its policies.
The result was the announcement on July 1 that athletes could begin to “engage in NIL activities […] without violating NCAA rules” regardless of whether a specific state had passed an NIL law.[1] Additionally, the NCAA amended its regulations to allow student-athletes to “use a professional services provider for NIL activities.”[2] The primary argument of the supporters of these changes is that student-athletes should be allowed to earn compensation, either monetary or otherwise, because they help to generate such significant amounts of revenue for individual colleges, their athletic departments, and the NCAA. Still, some opponents of NIL rights remain who contend that student-athletes are amateurs and receive suitable benefits in the form of an education and scholarships.
In the time since the rule changes took effect, many schools and athletes have taken advantage of NIL opportunities. Many of the NIL deals have resulted in unique and positive developments that would not have been possible in the past. For example, the Brigham Young University football team reached an agreement with Built Brands, “a company that produces protein, protein bars, and energy products.”[3] This NIL deal “will include compensation to all 123 members of the Cougars’ football team as well as provide full tuition for walk-on players.”[4] Not only will BYU’s most prominent football players be able to receive money from Built Brands, but the team’s lesser-known walk-ons also will enjoy benefits that were highly impermissible in the past. Furthermore, companies that engage in NIL deals with student-athletes likely will benefit from increased support from the athletes’ fans. Similar NIL endorsements that benefit all members of a specific team have been announced for the Kentucky Wildcats men’s basketball and Miami Hurricanes football teams.
While NIL agreements for individuals and teams initially seem beneficial for all parties, there are still complications and struggles that the NCAA is working to address. For example, the deal at Miami raises questions about the involvement of boosters in NIL endorsements. In that case, a business owner named Dan Lambert offered to pay $500 per month to every scholarship player on Miami’s football roster in exchange for their promoting his mixed martial arts gyms. Lambert also has created a corporation called "Bring Back the U" that will be solely focused on putting money in the pockets of Miami football players.”[5] He hopes to accomplish this feat by garnering “support from local businesses to hire the players as spokesmen” and by hosting fundraising events.[6] While this deal may seem acceptable on the surface, a potential problem arises due to restrictions in state laws and NCAA regulations regarding NIL deals with entities that have directly supported schools or athletic departments. However, Lambert’s offer is permissible because his new corporation has had no relationship with the University of Miami in the past. Still, Lambert’s deal reveals that more specific and comprehensive regulations likely will need to be put in place by the NCAA to ensure that boosters do not act improperly.
On October 21, 2021, Xavier University and The Brandr Group (TGB) announced a partnership that will create “new opportunities for Xavier’s student-athletes to profit off their Name, Image, and Likeness using the school’s official trademarks and logos.”[7] Xavier hopes that this deal will be beneficial not only for the athletes but also for the fans. In response to the agreement, Greg Christopher, Xavier University Vice President and Director of Athletics, stated that the partnership “provides a great opportunity for Xavier Nation to purchase items like jerseys, t-shirts and other gear branded with the official Xavier marks and support their favorite Musketeer student-athletes. The arrangement with TBG affords us another way to assist our student-athletes in their efforts to monetize their Name, Image and Likeness.”[8] This deal with TBG will enable Xavier’s student-athletes to join a group licensing program voluntarily but will not prevent them from agreeing to other NIL contracts on an individual basis. Already, athletes such as Nate Johnson, formerly of the men’s basketball team, have announced their own products in the form of individually branded apparel.
In October 2022, the Xavier men’s basketball team announced a partnership with a new nonprofit online merchandise store called Musketeer Gear, which “sells unique experiences and apparel that’s designed and created by student-athletes with the majority of the proceeds going back to the athlete.”[9] Many of the proceeds that do not go directly to the basketball players will be split between a general NIL fund for Xavier athletes and the All for One Fund. Thus, this endeavor is not only benefiting the basketball program but also other sports and the broader Xavier community. This idea has been spearheaded by 2014 Xavier graduate Anthony Breen who studied finance and entrepreneurship and now is the founder and CEO of Synergistic. This marketing and media company is growing rapidly and has provided the foundation for Musketeer Gear. When NIL compensation became an opportunity open to Xavier athletes, Breen recognized that NIL would quickly “become a popular talking point and, realistically, a selling point regarding where recruits will end up playing in college.”[10] He immediately began considering how he could help his alma mater enter the NIL age.
The result was Musketeer Gear. Adam Kunkel and Colby Jones interned at Synergistic this past summer and became leaders on the team for making this idea a reality. Kunkel, Jones, and the other players spent months developing ideas and designs for t-shirts and sweatshirts featuring their own personal messages, nicknames, and imagery. They all participated in the process of designing the merchandise, considering costs and profitability, and now marketing the final goods. The new clothing line made its debut at Musketeer Madness on Friday, October 21, 2022 and already has shown signs of being a wild success. Breen hopes to continue this venture for many years to come so that future generations of Xavier athletes can benefit from NIL: “The long-term plan for Musketeer Gear is that this will become a sustainable model that's run each year by the student-athletes.”[11] Potentially even more importantly though, Breen believes that “regardless of any dollars that come from this, every student-athlete on the men's basketball team gets to learn about product creation, design, and about storytelling.”[12] Thus, the positive effects of Musketeer Gear and NIL for Xavier athletes extend far beyond the monetary value.
The Big East Conference also has pledged its support for helping student athletes to make the most out of NIL opportunities that are available to them. Specifically, the conference has committed itself to providing valuable education to its student athletes through “BIG EAST University, a virtual educational series designed to enhance the student-athlete experience with career and professional development programming.”[13] In addition to career and professional development, the curriculum will include a series dedicated entirely to Name, Image, and Likeness topics. In September of 2021, Big East Commissioner Val Ackerman commented on this important program and stated goals of “acknowledging the progressive expansion of opportunities brought about by NIL and providing our student-athletes access to educational programming that can help navigate these changes and take advantage of options that have never before been available to them.”[14] This program and the resources present at each member school should greatly assist the student athletes of Big East institutions.
Overall, the changes made by the NCAA regarding NIL rights for student-athletes have resulted in positive effects. Many colleges and universities have welcomed these developments and have assisted student-athletes in finding appropriate arrangements with companies. Still, more updates will be needed to make NCAA rules as clear as possible. Now that the current NIL environment has been in place for over full season of college athletics, the NCAA Division I Board of Directors is calling for “a review of how NIL policies, or lack thereof, have affected athletes’ school choice, transfer opportunities, academics and their mental health.”[15] Additionally, the board has “cited concerns about potential violation of NCAA recruiting rules, the representation for athletes as they broker these deals, booster involvement, as well as schools being involved in potentially arranging deals for incoming players.”[16] Currently, the NCAA is awaiting formal reports from its Division I Council regarding these issues. Once the reports are completed, the NCAA will vote on official constitution changes that will clarify language modifications and will cement NIL rights for athletes for years to come.
In the meantime, the NCAA Division I Board approved clarifications for its interim NIL policy on October 26, 2022. These clarifications focus primarily on “how schools can be involved with the name, image and likeness activities of enrolled student-athletes on their campuses.”[17] Specifically, the updates included recommendations to colleges and universities regarding providing education to student-athletes about financial literacy, taxes, and NIL rules and providing education to boosters about the rules in place. They also clarified to what degree schools are allowed to communicate with third-party companies to facilitate NIL deals for their student-athletes. Overall, the rules and regulations remain somewhat murky, but they have become clearer over time and hopefully will continue to pave the way for student-athletes to benefit monetarily and otherwise from their name, image, and likeness.
References: