The floodgates opened on Thursday with Name, Image and Likeness (NIL) going into effect for college athletes on July 1 at midnight. What we have seen in the several hours since this went into effect is college athletes all over the country announcing endorsements and events they will be taking part in to make money off of their personal brands.
This might be a bit confusing to the layperson, especially to those who might not be sure where exactly the money is coming from. Below is a nifty FAQ to answer some of these queries and provide a baseline understanding of where things are headed.
What the heck is NIL?
NIL is short for Name, Image and Likeness and pertains to someone’s right to profit off of their notoriety or standing. NCAA athletes are now permitted to accept money from brands or businesses to endorse or advertise products. They are also able to profit off of personal endeavors they may have, such as their social media accounts, YouTube channels, etc.
Before NIL changes taking place, athletes signed away their rights to profit off of their likenesses as a part of their scholarship agreements.
Are schools paying athletes to play?
No. In fact, most laws going into effect explicitly prohibit schools from paying athletes directly to play.
Are boosters going to be paying athletes?
They can as long as payments are not directly for athletic performance or incentives during recruitment.
What are activities that athletes will be making money from?
Athletes can now appear in commercials, both locally and nationally, as well as partner with brands. This also opens the door for them to make paid appearances publically, such as autograph signings or running their own camps, as well as cashing in on their social media followings.
Will this only benefit the star athletes on campus?
Believe it or not, no! Obviously, star players will have more opportunities with the spotlight on them, but other players with big social media followings or brands that are not necessarily built on their playing time or statistics stand to benefit, as well.
For example, Michigan Men’s Basketball player Adrien Nunez has a massive TikTok and Instagram following. This would make him arguably one of the most valuable NIL figures on campus at Michigan.
What is the University of Michigan’s role in all of this?
The University of Michigan supports student-athletes receiving compensation for the use of their name, image and likeness from sources outside the University consistent with the requirements of the future Michigan state law and limited guidance provided by the NCAA.
The University of Michigan is not responsible for providing or procuring name, image and likeness opportunities for any student-athlete(s).
The University of Michigan is not responsible for any tax liabilities or other costs student-athletes incur as a result of their choice to engage in name, image and likeness activities.
Student-athletes, like all students and staff of the University, may not use the University name, trademarks, service marks, logos, symbols, or any other intellectual property, whether registered or not, without appropriate licensing approval.
Is there anything that athletes are prohibited from associating with?
Michigan’s policy states that those who choose to attend the university are representatives of the institution. As a result, they are prohibited from pursuing NIL opportunities that promote gambling, adult entertainment, tobacco, or banned substances. They also are not allowed to engage in any NIL opportunities during team-sanctioned organized activities and cannot sell anything that was provided to them by the athletic department.
Can outside advisors be involved?
Students are allowed to use the services of professionals that can help them with marketing, tax advisory, legal help, etc. and are responsible for all costs incurred. They are not able to employ an agent “for the purpose of negotiating with professional athletic teams or organizations without jeopardizing their collegiate athletics eligibility.”
Can schools help arrange NIL opportunities?
The NCAA is currently leaving this up to individual schools and what the state laws say. They seemingly have the wiggle room to help position athletes to profit off of their likenesses but are being told to be careful to cross lines that might constitute something that resembles pay for play.
Why does everyone have different rules currently?
The state of California was the first to pass NIL rights laws in 2019, which make it illegal in the state to ban athletes from profiting off of their personal brand. Several other states, including Michigan, passed similar laws to open the door for NIL reform across the country.
This will shock you, but Congress so far has failed to agree on a national law that would extend to every school in the country. The NCAA needs this to avoid the legal challenges of potential antitrust violations without a federal law supporting the policies in place. Any school that is in a state without NIL legislation is kind of on its own at the moment.
Congress will eventually pass a bill given that there has been bipartisan support for NIL rights. The Republican and Democratic wings of the house are still arguing over how broad these policies should be. Republicans have voiced support for a bill that focuses solely on the NIL reform, while Democrats have stated they want more medical coverage, academic benefits and collective bargaining rights.
If there is not a bill passed, why is everything going into effect now?
The toothpaste is already out of the tube, so to speak, with laws going into effect in several places on July 1. As a stopgap, the NCAA passed temporary guidelines that opened the floodgates for all athletes to begin earning money for their likenesses on the July 1 date, which was originally when it was believed a federal policy would be put into place.
Any other questions?
There’s a lot to sift through here, so feel free to drop your questions in the comments below!