|
Good morning, and thanks for spending part of your day with Extra Points. The NIL era has unquestionably meant more money is being transferred into the pockets of current college athletes. Some of that money is coming from legitimate marketing activity, and some of that money is laundered through marketing activities as recruitment inducements...but the money is coming all the same. But NIL money isn't a salary. It isn't revenue sharing. And while getting $300 bucks here and some free clothes there is nice and certainly appreciated, it pales in comparison to the B1G Bucks that the Big Ten (and others) are bringing in via broadcast contracts....contracts to televise...the players. More athletes are speaking out, saying they believe they deserve some of that revenue. Some coaches even agree with them. But close are we to this actually happening? I don't think we're as close as you think. Here's a look at some of the mechanisms that could actually force schools and conferences to cut the check, and where we stand with each one. Will the courts mandate a Pay-For-Play system?It is entirely possible, but if they do, it sure isn't happening tomorrow. The case that poses the largest immediate threat to amateurism -as-we-know it is probably Johnson v. NCAA, a case currently on appeal in the Third Circuit. Our friends at The Athletic had an excellent explainer, but the tl;dr of this case stems from a few former football players at Villanova and athletes at a slew of other Eastern universities sued, claiming that athletes should have been classified as employees under the Fair Labor Standards Act. That would mean that the athletes would be required to at least earn minimum wage, qualify for Worker's Compensation, have access to collective bargaining, etc. The plaintiffs also claim that the NCAA is a joint employer, along with the schools. Other district courts have previously found in favor of the NCAA on these grounds, but those cases were heard before Alston, which could very well change how the employment question is analyzed. Should the Third Circuit find in favor of the athletes, there is a good chance that the case would be appealed, and eventually find its way back to the Supreme Court. The legal experts quoted in The Athletic story, as well as others I've spoken to informally over the last few months, are quick to point out that it is not an automatic lock that the Third District will find in favor of the athletes. Justice Kavanaugh’s concurrence in Alston, after all, was just a concurrence, not the majority opinion. Either way, a final resolution in Johnson, one after all appeals are exhausted, is unlikely to happen until 2024 at the earliest, and potentially even beyond that. The Alston case, after all, started in 2014, and didn't reach a final conclusion until late 2020. This stuff takes forever. Could a union force schools to pay players?Potentially! But that requires not just a union, but a union that's willing to stick together. Potential athlete labor action has some friends in the government. NLRB General Counsel Jennifer Abruzzo telegraphed her belief that many college athletes are improperly defined as non-employees, and invited athletes to challenge their employment status...not current athletes haven't taken her up on it (although some activist groups have). Athlete collective action during the COVID season mostly fizzled out without creating a sustained, organized presence. The first major CFBPA action also faltered before it could get off the ground. I am not saying that a collective college athlete labor action couldn't force schools and conferences into major labor concessions. I am just highly skeptical that any mass-movement with either proper legal protections or strong enough membership to ensure staying power is imminent. There are so, so many barriers to effective organization and power projection in this population. I think expecting an athlete union (or proto-union) to force anybody to the bargaining table in the immediate future is probably unrealistic. Could a conference just decide to unilaterally start paying players?Maybe? But boy do I highly, highly doubt it. This question comes from a brief firestorm surrounding Big Ten Commissioner Kevin Warren's comments on HBO. The original tweet said this: But in full context? I'd argue it reads very, very differently. Here's the actual transcript of Warren's remarks, which reads substantially more non-committal. and here: So Warren is pledging to be "part of this conversation", and that "these are things that we have to resolve", but doesn't say anything about timetables, specifics, or firm commitments beyond being able to "foresee" paying athletes in the future. Could those conversations eventually resolve in the Big Ten formally sharing broadcast revenue with athletes? It's possible, and it may even be possible for the conference to do so without formally declaring athletes as employees. But it's very rare for any organization to voluntarily give up a massive chunk of revenue without being compelled to do so, either by courts or by collective pressure from workers. The Big Ten, and member universities, would also want to be very careful about how they proceeded, lest they accidentally stumble into full-athlete employment (which member schools do not want), or worse, create a framework to increase unionization by non-athletes on their campuses. My assumption is that Warren and other Big Ten leaders will be careful to not out-and-out dismiss the idea of revenue sharing, and they'll continue conversations with in-house groups that they can have some modicum of control over (a Big Ten Student-Athlete Advisory group, rather than an outside body like the CFBPA or NCPA) until an outside body forces the entity to share revenue. I keep thinking about Ohio State AD Gene Smith, who was quoted Friday in the Columbus Dispatch, when asked about revenue sharing: “Do we do more down the road? Possibly,” Smith said. “And that will be discussed, but not in the form of pay-for-play. Otherwise, I'm out.”
Can the schools actually afford this?That's a question raised by this Saturday Down South story. Via the story: “(University) Presidents are desperate for revenue because they can’t hold (pay-for-play) off much longer,” an industry source told SDS. “After they’ve all worked their own conference (media rights) deals, there’s only one revenue stream left to supplement players.” [expanding the College Football Playoff]
...
The Pac-12, ACC and Big 12 want Playoff expansion now because they’re in survival mode. Each of their media rights deals will be at least half of what the Big Ten and SEC earn — and each would struggle to support pay-for-play.
The only way to survive in the new college football landscape of pay-for-play is increased revenue.
I don't completely buy that argument. Could every school afford it? Probably not. But at the P5 level? I believe the answer is unquestionably yes. They probably can't afford to do it without making significant changes to the way the rest of athletic department funds are distributed, but that's a different question. To pay all 85 scholarship football players a base salary of say, $75,000, would, according to my Liberal Arts Major math, run about $6,375,000. That's a lot of money, even for schools with budgets above $100 million, and not many could instantly absorb that costs without hits. But people forget that the entire athletic department budget system is based around a world where schools can't directly pay athletes, so they need to excessively spend on everything else. Coaching salaries would unquestionably have to come down (you can't make $9 million a year, with a $6 million salary pool, and finish sixth in the SEC West in a world where labor can be directly compensated), as would facility spending, recruiting spending, and even support staff. But you also wouldn't need all of that stuff. There's a reason that so many college football facilities are nicer than their NFL counterparts. If you bring that back into balance, even Oregon State will find they have some money lying around. Every organization wants more money. But to state that a conference has to make a killing on their next TV deal in order to prepare for Pay-For-Play assumes that a) schools are going to save this windfall for a proverbial Rainy Day, which, lmao have any of you met athletic directors, and b) that direct compensation wouldn't change anything else about an athletic department budget...which I do not believe can, or should, be assumed. The math will unquestionably get harder for an Ohio Valley Conference institution or Sun Belt squad. But those leagues aren't the ones trying to conquer television markets 1,500 miles away from their footprints, either. Could Congress potentially force the schools to pay the athletes?Potentially...but very unlikely. Republicans are likely to take back control of the US House, and may very well win the Senate as well. Most lawmakers don't really care about the nuts and bolts of college sports, and despite a gazillion hearings and the pleas of nearly every senior college sports administrator, don't seem to be hurried into passing even relatively banal NIL legislation. The idea that Washington would force the end of amateurism before the courts, unions or another party did...feels very unlikely right now. So, that was a lot of cynicism. Do you not think this happens eventually?Honestly, I do think it happens eventually. The court process can be very slow, but eventually, I believe enough judges are going to look at these broadcast contract numbers, read the NCAA's arguments and decide they're baloney. Eventually, I think we'll see something resembling a college athlete union, or unions, with enough stable membership to ensure the group's survival after multiple graduating classes, one that could push for a CBA, just like in pro sports. Eventually, I see a world where college athletes are directly paid, rather than laundered through NIL collectives. I just don't see that world happening in 2022. Or 2023. And probably not in 2024 either. I could be wrong! We're unquestionably in an era of massive, structural change in college sports. I just don't think this particular change is quite as close to happening as it may appear.
This newsletter is brought to you in part by 1440 Media: News Without All the Nonsense. Check out 1440 - the fastest way to an impartial point-of-view. The team at 1440 scours over 100+ sources so you don't have to. Culture, science, sports, politics, business and everything in between - in a five-minute read each morning, 100% free. Sign up now!
This newsletter is also brought to you in part by D1.classroom, a new D1.ticker product built to help college classrooms save money and time. For more information about D1.classroom, drop me a line at Matt@ExtraPointsMB.com.
To sponsor a future Extra Points newsletter, please email sales@extrapointsmb.com. For article ideas, newsletter feedback, FOIA tips, athlete NIL sponsorships and more, I'm at matt@extrapointsmb.com, or @MattBrownEP on Twitter, and @ExtraPointsMB on Instagram.
|
