NIL, explained: Name, Image, Likeness. What is NIL, College Sports NIL deals
A new industry was born overnight. The NCAA has allowed student-athletes to profit off their name - Something they hadn’t allowed in the past.
A new industry was born overnight.
College sports is undergoing a revolutionizing moment in its history. Athletes are now able to sell their name, image, and likeness (NIL) rights while playing in college. The NCAA's Division I Board of Directors has formally adopted new rule changes that will at least temporarily get rid of restrictions that previously prohibited college athletes from making money. Although greatly beneficial, the guidelines provided by the NCAA still leave a vast amount of questions.
NCAA President Mark Emmert illustrated he wished the association was more detailed in the rules created but understands legal concerns about antitrust violations prevent most specific guidelines. Emmert and others in the NCAA seem to hope the U.S. Congress will assist in creating a federal law that becomes standard and allows for more clarity on what all college athletes can do to make money off their name, image, and likeness.
College athletes started to announce partnerships on social media and the numbers are astronomical. NIL deals have opened the door to life-changing money for athletes and their families.
What is NIL?
First and foremost, NIL stands for Name, Image, and Likeness. NIL deals are essentially compensation — in most cases money — earned by college athletes for use of their fame or celebrity status. Examples include social media shoutouts, rocking merchandise of certain brands, being paid for autographs, or appearing in an advertisement. In other words, businesses can strike a deal with an athlete and pay them to promote their services or product. Athletes are required to notify their schools of NIL arrangements.
Why is NIL important?
Your favorite professional athletes have been able to ink lucrative compensation deals for years, from shoe companies, service companies, or product endorsements. College athletes have been prohibited from doing so under the argument “amateur athletics should remain free of the influences of money” or “they study for free at the universities already”. A lot of people involved were making money (a lot of money) - everyone but the athlete(s). Although scholarships are given to some student-athletes to study freely and other benefits are provided, Universities are raking in millions of dollars a year while some of their top athletes struggle financially. This new rule changes the course of life for a lot of student-athletes and their families.
What led the NCAA to change its policy?
Lebron James? Okay, maybe not just him. Truthfully, Lebron James may not have single-handedly done it but I’ll explain how Lebron impacted this moment. California Governor Gavin Newsom went on HBO and Uninterrupted’s "The Shop" to literally sign California's "Fair Pay to Play" act alongside NBA star LeBron James and other guests in attendance. “The Shop” is a platform Lebron James created for the betterment of athletes as he described in that particular episode.
The law allowed college athletes in the state of California to profit off the use of their name, image, and likeness and made it illegal for universities to revoke a student's scholarship for accepting money. The bill will not pay athletes to play, but it will allow them to sign agents and arrange business deals. Other states quickly followed the lead and before long, the NCAA was facing the possibility of different rules across the nation – a disastrous situation numerous feared would lead to inequities across the sports. High recruits were likely going to begin choosing schools in states they could profit off their name, image, and likeness.
Guidance regarding NIL compensation was supposed to happen months ago. But, The NCAA was warned by the Justice Department of possible antitrust violations. In addition, the NCAA was hoping for a federal law from Congress to become the standard but that has remained dormant. While those efforts remain idle, the NCAA essentially is allowing athletes to follow the NIL rules in their states and allowing schools to monitor their athletes. Also, in states without a NIL law, athletes don’t have to worry about putting their eligibility at risk for NIL earnings.
We should see an upward trend of student-athletes releasing NFTs, signing endorsement deals, promoting products and services, contributing to communities, among other events.
NIL deals are growing in popularity and value
There is still a ton of work to do in this newly formed industry. But, this is a step in the right direction.
Every NCAA athlete in the country will have the opportunity to begin making money from their names, images, and likenesses. This new rule changes the game!
Let the games begin!
Photo by Braden Collum from Unsplash