Where is College Sports Headed? The Evolution of NCAA Amateurism to NIL Rights

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Mark Conrad
Hello and welcome to the Sports Business podcast, the show that explores the world of professional, collegiate, amateur and Olympic sports. I’m Mark Conrad, or Prof. C from Fordham University's Gabelli School of Business, where I serve as the professor of Law and Ethics and the director of the Sports Business Initiative. Imagine a voluntary private sports organization of longstanding vintage, one that had a unique mission found nowhere else in the world.

00;00;45;19 - 00;01;19;05
Mark Conrad
Although non-governmental, it had a body of rules and regulations that would make a federal bureaucrat blush. They were intricate with armies of compliance officers employed by its members to ensure the rules were followed, and the rules were the de facto laws of college and university sports for decades. The organization was struck in a traditionalist mode, probably the last one in the world that maintained a strict series of rules barring even the whiff of professional conduct.

00;01;19;08 - 00;01;56;26
Mark Conrad
These rules, enacted by consent of the member schools, created a social contract. And to be fair, one that had some validity and may still have some validity for many, many schools and many school athletes. In essence, the organization claims that college athletes are students first and athletes second. The organization regulated competitive balance among schools. The goal was to get an education, experience competition, build friendships, and boost school spirit for students and alumni.

00;01;56;28 - 00;02;28;17
Mark Conrad
Not insignificantly, many receive full or partial scholarships to defray the cost of attendance. Rules were equally administered for schools in various divisions to prevent richer and bigger schools from using their leverage to find the best athletes. And of course, we're talking about the NCAA. For decades, the NCAA was the alpha and omega of college sports. It resisted outside attempts to regulate its activities.

00;02;28;19 - 00;03;04;28
Mark Conrad
It branded itself as a guardian for the sacred altar of amateurism. It did not consider itself a business. Really? It negotiated TV deals for years. The athletic conferences, ever more powerful, negotiated bigger ones. Its member schools paid big time coaches increasingly lucrative seven figure annual contracts and entered into profitable sponsorships. Schools sold tickets to alums and others, filling up arenas and stadiums that can make a pro facility look simply functional.

00;03;05;00 - 00;03;34;13
Mark Conrad
They thought of athletic success as a chip to attract big money from alums. So, the schools can make money. The broadcasters make money. The sponsors make money. Coaches make money. But what about the athletes? These students may start to think of themselves finally as a labor force, entertaining the other stakeholders. And they are not merely an appendage to college athletic departments.

00;03;34;16 - 00;04;08;12
Mark Conrad
State legislatures and the courts have belatedly discovered that the NCAA and the athletic conferences are business, especially in about 40 to 50 large universities in this country. By passing laws ensuring name, image and likeness rights to college students, which the NCAA opposed, the quaint idea of students not able to sign contracts, have agents or make money, must have shocked some of the folks at Indianapolis, the headquarters of the NCAA.

00;04;08;15 - 00;04;37;18
Mark Conrad
The fallacy of the NCAA’s misguided notion of amateurism was readily made clear by the U.S. Supreme Court in the Alston case a couple of years back, when the justices unanimously rejected the association's argument that its restrictions of educational benefits was justified despite laws against agreements that restrain trade. What is rarely reported is that the NCAA won a part of its case.

00;04;37;20 - 00;05;04;23
Mark Conrad
The lower courts accepted its rules restricting outside non educational income. It just restricted its limitations on educational benefits. I don't know who came up with the strategy of appealing to the U.S. Supreme Court, but appeal the NCAA. For its efforts and the millions in legal fees expended, the NCAA was rewarded with a 9 to 0 ruling against it.

00;05;04;25 - 00;05;47;13
Mark Conrad
Yes, this Supreme Court. The justices ripped the heart out of the NCAA’s ideal of amateurism as the raison d'etre of college sports. And one Justice, Kavanaugh, went even further, basically calling the NCAA’s regulations an illegal restraint of trade that would not be tolerated in any business. So we now have a world where some of the 40 to 50 powerhouse college programs are jockeying for new conference alignments in an attempt to pocket even more revenues, imposing difficult travel schedules for students on many teams to fatten up the broadcast and streaming rights fees.

00;05;47;16 - 00;06;19;26
Mark Conrad
All the while, athletes are litigating, seeking to be considered employees and possibly unionizing. This may sound like old hat for some of you, but this history leads to the question of where do we go from here? And it's time to look into my crystal ball, called Prof. C’s Prophecies. And here are some prophecies. One: In the next half decade, many college athletes, especially from these power conference schools, will be compensated as employees.

00;06;19;29 - 00;06;47;10
Mark Conrad
It is just a matter of time. Not all, but many. Either the courts will consider college athletes employees under the National Labor Relations Act or by the courts or Congress amending the labor laws, conferring such a right. Once they are employees, most likely in football and basketball, but possibly in other sports, then these athletes could unionize and some will.

00;06;47;12 - 00;07;18;29
Mark Conrad
Then we're left with two or three super conferences just for football or breakaway conferences becoming de facto NFL minor league teams. The great majority of schools will offer a more traditional menu of college sports, possibly reverting back to a model of less money, more walk-ons and fewer pressures to produce large revenues. A few schools could even eliminate football, making Title IX enforcement a whole lot easier.

00;07;19;01 - 00;07;49;16
Mark Conrad
Finally, antitrust law challenges to the NCAA’s policies will continue. But attempts in Congress to create an antitrust exemption for the NCAA, a persistent hope for the NCAA powers that be, will fail, as it should. Before traditionalists quake in their boots, hear me out. For the power schools, those generating $50 million a year or more from college football and basketball teams,

00;07;49;18 - 00;08;25;12
Mark Conrad
the unionization of athletes would avoid litigation and congressional action and would bring consistency and stability. NIL standards can be negotiated rather than devised by collectives and in the free for all situation that we have now. Working conditions and health insurance could be negotiated as would transfer rules. Finally, to the relief of everyone except the lawyers, the result will be a less contentious and less litigious atmosphere because collective bargaining agreements are essentially litigation-proof.

00;08;25;14 - 00;08;52;07
Mark Conrad
And that is a big plus for all the stakeholders, including the fans. Thank you for listening. Until next time, this is Prof. C for the Sports Business Initiative.