Everything you need to know about NIL
Introduction To Name, Image, Likeness (NIL)
College sports are currently undergoing what may prove to be the single most significant change they will ever experience, all from one simple question: should college athletes be paid? The answer comes down to three letters: NIL.
Until recently, the question of should college athletes be paid was answered by the fact that across all sports and universities, student athletes were considered amateurs and therefore prohibited from receiving monetary compensation for their athletic accomplishments. The concept of paying college athletes, however, has been anything but a clear cut issue.
Athletes
Athletes have demanded compensation through various means and coaches have been caught trying to incentivize players to come to their school through elaborate gifts or sneaky offerings of cash, but the debate about paying college athletes has never moved the needle on any concrete action. While the NCAA and individual universities have profited off of the name, image, and likeness of their student athletes for decades, it isn’t until recently that the athletes themselves are being invited to take a slice of this massive pie of revenue.
The NCAA’s board of directors officially suspended the organization’s rules prohibiting athletes from selling the rights to their names, images and likenesses. These new rules, and the various state laws that have followed, represent a major shift in the NCAA’s definition of “amateur student athlete.” The debate asking should college athletes be paid is only heating up. While NCAA have long fought to keep students out of the money-making side of college sports, athletes now have varying extents of protection, allowing them to profit by selling their name, image, and likeness (NIL) rights.
While this decision will have long-term implications which are yet to be foreseen, the short-term shift in amateurism rules means college athletes can start making money now. But how?
What does NIL mean and where did it come from?
In the simplest of terms, Name, Image and Likeness (NIL) is a term that describes the means through which college athletes are allowed to receive financial compensation. NIL refers to the use of an athlete’s name, image, and likeness through marketing and promotional endeavors. This can include autograph signings, product endorsements, social media posts, and more.
At the same time, it’s important to understand what NIL does not mean. NCAA rules still prevent schools from paying players directly. This means that college coaches cannot offer money as an incentive for high school athletes to come play at their school, nor can athletes receive compensation directly from their university based upon their athletic achievements. Because the NCAA still intends to maintain its amateur sports status, paying athletes for their play on the field isn’t possible. However, NIL is the workaround for athletes to get paid without technically being considered professional athletes who make a living playing their sport.
Origins of NIL
NIL can trace its origins to a class-action lawsuit filed in the late 2000s that marks the beginning of the “should college athletes be paid” debate. Former UCLA basketball player Ed O’Bannon argued that college athletes should be compensated for the use of their name and image in video games. Eventually, A judge ordered the NCAA to pay $44.4 million in attorneys’ fees and another $1.5 million in costs to lawyers for the plaintiffs in the Ed O’Bannon class-action antitrust lawsuit. This case opened up the doors for more questions and lawsuits around athletes’ name, image, and likeness.
The largest of these advancements came in 2019 when California enacted the Fair Pay to Play Act, which allowed athletes to be compensated for promotional opportunities. Other states quickly followed and similar legislation in different regions forced the NCAA to take a look at their stance on NIL.
As of now, NIL guidelines are relatively simplistic, leaving a lot to interpretation. Per the NCAA board of directors, the rules state that:
- College athletes can engage in NIL activities that are consistent with the law of the state where the school is located.
- Colleges and universities are responsible for determining whether those activities are consistent with state law.
- Student-athletes who attend a school in a state without a NIL law can engage in this type of activity without violating NCAA rules related to name, image and likeness.
- College athletes can use a professional services provider for NIL activities.
- Student-athletes should report NIL activities consistent with state law or school and conference requirements to their school.
In Conclusion
As one can see, these rules have created a modern day Wild West situation, with everyone looking to find where exactly the line in the sand is and what might happen when they cross it. It’s no longer a question of should college athletes be paid, but how.
What we do know is that payments for athletic-related performance cannot come from the universities themselves but must come from businesses. Also, some (but not all) state laws prohibit athletes from endorsing alcohol, tobacco, or gambling products, and some (but not all) states also prohibit athletes from using their school’s logos or other copyright material in endorsements.
Still, we’re starting to see athletes from all across the country and in all different sports start to take advantage of these new rules in interesting and creative ways.