A representative for a college star athlete said loudly what most schools hear in private: Either pay the player more or he will transfer at a school that will.
Last week’s brazen request for University of Miami basketball star Isaiah Wong provided a rare glimpse into how elite college sports are transformed by athletes’ rights of earning money through endorsements.
Teams are discussing contracts. Financial backers of players are exchanging barbs. Coaches and administrators are having trouble keeping their rosters full and players happy without breaking the rules.
According to labor experts, Wong was legally allowed to act as an agent. Players can’t ask for payment in exchange for promises to play at specific schools.
College sports move towards a free market
A representative for a college star athlete said loudly what most schools hear in private: Either pay the player more or he will transfer at a school that will.
Last week’s brazen request for University of Miami basketball star Isaiah Wong provided a rare glimpse into how elite college sports are transformed by athletes’ rights of earning money through endorsements.
Teams are discussing contracts. Financial backers of players are exchanging barbs. Coaches and administrators are having trouble keeping their rosters full and players happy without breaking the rules.
According to labor experts, Wong was legally allowed to act as an agent. Players can’t ask for payment in exchange for promises to play at specific schools.
Michael LeRoy, a labor law professor at the University of Illinois, stated that “We are quickly moving towards professionalization at full-market rate for these NCAA athletes.” It’s clear that it’s not about endorsements. It’s about men getting paid for their performance.
Up until recently, college athletes were not allowed to accept endorsement deals or other compensation than scholarships. Students were considered a threat to amateur sports. Athletes seeking to make a living from the billions of dollars that schools made from sports faced legal challenges. California was the first state to adopt a law that allowed athletes to make money from endorsements, autograph signings, and other activities in 2019. The NCAA also lifted the decades-old ban by July 2021.
The NCAA did not provide any guidelines. These deals could not be used as an incentive to recruits or as a form pay-for-play contracts.
Wong has apparently decided to stay in Miami. He wasn’t the first representative to make a demand on a player’s perceived value. Experts say he won’t either.
Todd Berry, executive director at the American Football Coaches Association, stated that Berry was “just the first to make it so public.”
Opendorse reports that thousands of athletes from many sports have cashed out, according to a firm that works alongside schools to help with player-compensation matters, which range from compliance to brand-building.
Deals may be as low as $100, while some can reach $1 million. According to Opendorse, football players are the highest-paid, followed closely by men’s and women’s basketball players. Even in low-profile sports like golf, rowing, and hockey, endorsements can be found all over the world.
It’s been a handful of players who have landed big deals so far. But that could change. LeRoy, a labor law professor, was curious about what would happen if the players of the same basketball team demanded more generous endorsement payments. This could put a program in an awkward position.
Because the rosters in football are more diverse than basketball, it’s easier to get a team back on its feet. However, it is difficult for coaches to keep everyone happy.
Berry stated, “All 85 players are your roster. Every year you get free agents.” This is a professional model. “This is no longer a college model.”
Sonny Dykes, a TCU football coach, said that recruits often ask about endorsement deals.
“Basically, we can only pass on a phone number and say, “Hey, this guy can talk to you, and he will tell you what we can and can’t do.” Dykes stated that it’s very simple. “I worry that someone makes a promise to a child and then doesn’t keep it. That is something we have no control over.”
Many times, the best people to call are those running sports marketing agencies called collectives. These agencies have been set up to facilitate deals between athletes and businesses, such as car dealerships, energy drink companies and apparel companies.
One group in Texas offers $50,000 per year to offensive linemen to support community charities such as representation or promotion. Phil Knight, the billionaire Nike founder, is part of a group that helps Ducks athletes negotiate deals.
Nigel Pack, a Miami men’s basketball player, signed with LifeWallet for $800,000. He also received a two-year lease on a car and a personal computer. Paige Bueckers, a UConn basketball player, was last year the first college athlete that signed a deal with Gatorade.
According to LEAD1, an association representing 130 athletic directors from the Football Bowl Subdivision, a large number of athletic directors are concerned that collectives may improperly use endorsement contracts to recruit high school and other college players.
“This is a transformative period in college sport and the results from our survey illustrate that (athletic director) are extremely concerned about a number key issues,” LEAD1 President Tom McMillen stated.
Since allowing endorsements, the NCAA, which is the governing body for college sports, has been largely hands-off. More than two dozen states have laws that allow endorsement deals. The ban on pay for play is a major feature of most state laws.
Wong’s case is one example of how fast college sports are changing. This is why there is a lot more pressure to look into the matter. The commissioners of Pac-12 and the Southeastern Conference, two of college sports’ most wealthy leagues, met with Washington lawmakers to discuss federal regulations. These could include bans on endorsement contracts and pay-for play deals.
Some coaches, leagues, and schools worry that the new free-for all will disrupt rosters, upend competitive balance, and give more control to outside forces over athletic programs.
Many were surprised at how quickly wealthy individuals and deep-pocketed groups teamed up with major colleges to pour millions of dollars into the hands of athletes.
LeRoy stated that “nobody expected these collectives to form a year ago.” It shows how out of control this whole system is. Schools can now use it to find third-party payers for their athletic talent.
Even financial backers may be caught off guard when athletes decide the money isn’t enough or when a teammate becomes a financial rival.
Mit Winter, a Kansas City-based sports law and business lawyer, stated that some deals are pushing the limits and making it appear as if players get paid to play rather than being paid at market rates for endorsements.
Winter stated that “Arguably these agreements are violating NCAA regulations and sometimes even state laws.” “That is the big question: Will the NCAA ever investigate some of these deals?”
Many people see a future where schools and athletes can collectively bargain. Schools would be treated more like employees if they were to do this, something that the schools have rejected.
In a memo, the National Labor Relations Board’s top lawyer stated that college athletes should be treated like employees. This memo opened the door to athletes being able to bargain or unionize their working conditions.
Schools and conferences would need to be flexible and creative in order to collectively bargain. They could use their institutional power to negotiate with athletes who might have different interests such as gender equality and safety.
It would be a nerve-wracking moment for leagues and teams. LeRoy stated that they don’t have any experience with the process and their TV contracts would be uncertain. They would still be able to resolve their labor issues in the end.
