7th Edition: Trends in Marketing Communications Law
2019 witnessed a landmark change in one of the most controversial matters plaguing college sports: the National Collegiate Athletic Association (NCAA) rule prohibiting student-athletes from accepting compensation for the use of their name, image and likeness (NIL) rights. Set to take effect in 2023, California passed Senate Bill 206, known as the Fair Pay to Play Act, which will allow collegiate athletes in California to sign endorsement and licensing deals and earn compensation, while prohibiting governing bodies, such as the NCAA, from disqualifying them as a result.
This move set off a chain reaction. Florida and Colorado recently passed similar legislation, and other states, including Illinois, Minnesota, Ohio, New York, Nevada, Pennsylvania and South Carolina have all introduced their own bills that will have a similar effect if passed.
With pressure mounting, the NCAA reached a monumental decision when the association unanimously voted to implement a framework allowing student-athletes to profit off of their NIL rights. The NCAA Board of Governors has recommended certain changes to the bylaws to reflect this decision, like permitting student-athletes to identify themselves by sport and school. It’s now up to the three NCAA divisions to take those recommendations and amend their bylaws and draft new rules, standards and guidelines by January 2021.
Additionally, the Fairness in College Athletics Act was presented in the U.S. Senate which, if passed, would devise a national framework for permitting student-athletes to license their NIL rights, as opposed to forcing the NCAA and athletes to navigate conflicting state regulations.
This is potentially a huge win for collegiate athletes. With changes to the law and NCAA bylaws set to take effect in the coming years, athletes should soon be able to share in a portion of the vast revenues generated by college sports. National marketers will have an opportunity to create new partnerships with young and rising stars, while local and regional marketers will be able to leverage the enormous popularity of college sports and athletes in their communities, particularly in those communities without professional sports organizations.
As this watershed moment continues to unfold, it will be important to follow how the NCAA, as well as federal and state regulators, balances the interests of the athletes, the schools and conferences. The NCAA will certainly push for restrictions to protect existing partnerships and boosters from distorting the intent of these regulations. One thing is certain, though: college athletes will finally have the opportunity to reap the rewards of their hard work.
- California’s Fair Pay to Play Act forced the NCAA to reconsider the fundamental relationship between colleges and student-athletes, permitting athletes to accept endorsements in exchange for compensation without being penalized.
- Faced with potentially incompatible state bills, the NCAA and Congress are taking steps to establish uniform guidance.
- Marketers and their agencies should monitor the progress of Congress, states and the NCAA to devise strategies to maximize the availability of NIL rights, and businesses will begin to develop strategies on how to market and license NIL rights on behalf of student-athletes.