Over the past several years, spending to attract college recruits has risen along with athletic department budgets. Recruits have historically valued college coaches and facilities in selecting universities. Coaching salaries have risen dramatically and capital budgets have exploded with low interest rates and campaigns to build new facilities. However, I believe we are about to experience a massive shift in how athletic funds are spent.

When the Supreme Court ruled that universities cannot restrict players from earning based on their name image, and likeness, there were not limitations placed on the ruling. The NCAA specifically allows athletes to retain eligibility while receiving NIL funds. While the NCAA (recently) prohibits recruits from receiving NIL funds, I am not aware of any restrictions from universities directly providing NIL payments to current players.

I believe that universities are very hesitant to make payments directly to current players for NIL, given the historical restrictions, including any payments to players, public sentiments and the rapidly changing landscape regarding NIL.

In fact, a trend is already be starting where universities are hiring or contracting with resources which can help athletes maximize their own NIL earning potential. Some universities are now offering classes and even college credit on how to build a brand. Others have been a little more aggressive.

“in March 2020 when [Nebraska] announced it was expanding its partnership with Opendorse …to launch the Ready Now program and become the first college to invest in NIL preparation programming.”

“Jordon Rooney, who was hired by Duquesne as the first Division I personal brand coach. “

“Arkansas became the first college sports department in the country to hire a senior staff position specifically focused on NIL when it appointed Terry Prentice as senior associate athletics director for athlete brand development and inclusive excellence”. Quotes taken from http://www.si.com/.amp/college/2021/07/01/name-image-likeness-programs-schools-ncaa

College football is largely a competition to attract the best athletes, and I believe in the very near future universities will go further than providing resources for NIL and begin paying players directly. And if the current NCAA restrictions are challenged in court, or lawsuits are threatened, the NCAA may eliminate its restrictions on paying recruits for NIL as well.

Just listen to the current president of the NCAA, Mark Emmert. He envisions a world where athletes are paid for being something called a “brand ambassador”: “I’m really serious about this brand ambassador model I’m talking about. I think that especially with the size of media contracts that are being created right now, there needs to be recognition of the brand building value, for the school itself, of the athletes. And so, finding a way to provide money to athletes, not as employees but as these basically brand ambassadors, that are that are are gauged to the marketing power of individual sports”. https://businessofcollegesports.com/name-image-likeness/the-future-of-nil-and-compensating-athletes-with-ncaa-president-mark-emmert/

It is important to note that, when the door opens for universities to pay players, there would then be two separate payment streams to athletes: (1) boosters and sports marketing agencies and (2) the universities themselves. While the NCAA currently restricts payments to recruits, the promise of these revenue streams will, in fact, entice athletes to universities and they will go to the highest bidder.

Historically important factors in making recruiting decisions like coaching and facilities , will likely become secondary factors, or perhaps tiebreakers. The athletes will generally go to where they get the most money and who will blame them?

It is no surprise that conferences are chasing larger television contracts, however these resources become even more important when the funds will be used to attract future talent.

And this leads us to a series of interesting questions for future posts:

Which universities will be able to commit the most funds to athletes? Are these the same perennial powers with the largest athletic budgets? Will the power five conference schools, or simply the Big Ten and the SEC, retain their advantage?

How will spending on player compensation realign university athletic budgets? Will this become the largest line item expense?

As booster funds are made directly to players, how will this impact their giving to universities?

Will universities attempt to limit player compensation, as in something akin to a salary cap? With the threat of anti-trust, how would this be implemented?

How likely is it, that a small number of highly motivated boosters, with sufficient resources, can change the entire landscape of recruiting? What if T Boone Pickens past donations to Oklahoma State University had instead gone directly to players?

Will the greater source of NIL funds come from university budgets or from boosters?

Surely the contracts for NIL will include clauses to protect those providing the funds. Will they include NFL style clauses, such as guaranteed funds and incentive payments? Will these contracts include incentives to play in final bowl games? What kinds of protections will be in these contracts for players that never actually enroll, or don’t complete entire seasons? What about clauses for reputational type violations?