The elite minds of academia have made a groundbreaking enforcement decision for the future of college athletics, and it again underscores one undeniable reality.
They have no idea what they’re doing.
The NCAA is on the losing end of a $2.8 billion settlement of a lawsuit that accused the organization of restricting player earning that will redefine amateurism as we know it. And what does the NCAA do before the lawsuit is officially approved by the court?
It doubles down on stupid.
The House case settlement will pay billions in back payments to former college players who were unfairly prevented by the NCAA from earning off their name, image and likeness. The settlement also provides the framework for a pool of $20 million to 23 million – that will increase annually – to pay players for the use of their NIL beginning July 1.
That’s the bones of the litigation. Here’s the guts: the Power Four conferences – SEC. Big Ten, ACC, Big 12 – who have seized control of all things NCAA, have one goal, and one goal only on this road to perdition.
Protect the money.
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Even at the expense of more lawsuits, and more millions and billions lost. Even if it means cobbling together some big-name muckety-mucks – hey, a system designed by Deloitte Consulting LLP just sounds so fancy, they’ll buy it! – with a yet to be named czar of college football and declaring that enforcement of all things henhouse will, from this day forward, be meted out by Mr. Fox.
All because they don’t want players as employees, and don’t want them to unionize and collectively bargain. Because that’s when the real financial hit arrives.
This $20 million to 23 million annual pool of money paid to athletes is a pittance compared to what could be lost if players organize. So what do the power conferences do?
They announce a system that evaluates NIL deals external to the schools, making sure they’re they’re legitimate and ‘within a reasonable range of compensation, and made with the purpose of using a student athlete’s NIL to advance a valid business purpose.’ Translation: their vision of fair market value.
These people never, ever, ever learn.
What’s the best way I can explain this? Imagine if the NFL, or Major League Baseball, or the NBA, hired Deloitte to devise a system that would help their commissioners manage ‘within a reasonable range of compensation’ what their players can and can’t earn off their name and likeness.
It’s the foundation of the free market. You pay what you believe something is worth — and no one can tell you what something is worth other than the highest bidder.
My initial thought is these are the dumbest financial minds ever. But you have to look closer.
The NCAA (see: the power conferences) are willing to spend tens of millions – maybe even hundreds of millions – in future lawsuits to drag out this inevitable process of shared and collectively bargained wealth.
The longer they drag it out, the longer they wait until they pay closer to an NFL-sized percentage of revenues.
Or as former Auburn and Michigan State quarterback Payton Thorne told me last week, “It’s just minor league football now. Anyone who thinks anything different is fooling themselves.”
The power conferences have decided that 10 athletic directors will set up an entity that will play judge and jury over potential enforcement issues. The entity (see: a czar and his staff) will partner with Deloitte – I’m laughing now as I type this – to assess fair market value, and what measures will be taken if the deals are out of bounds.
Check me if I’m wrong, Sparky, but that’s the same illegal move that just cost them $2.8 billion in damages in the House case.
The people who want, more than anything, to protect their billions in annual revenue, will provide oversight of what a “legitimate” NIL deal is — and then use fancy, schmancy Deloitte to proclaim, ”Yeah, that’s right!”
Wait, it gets much better. If the deals aren’t of their perceived market value, the group run by athletic directors can fine programs and reduce the amount of future money they’re able to offer.
The hope is, in theory, that the system over time will build on itself. The more NIL deals that are filtered into the system, the greater the chance to keep future deals legitimate.
But why should athletes be subject to a mediator who declares what’s legitimate, who potentially prevents them from earning top-dollar, while Georgia pays Kirby Smart $13 million to coach football ― and resets the market with every raise given?
It doesn’t matter that Smart is paid for what he has accomplished, and that Michigan freshman quarterback Bryce Underwood is paid for what he could do. Each is worth whatever someone will pay.
There are attorneys lining up right now to take these looming cases, and sue the ever-loving bejeezus out of the NCAA. More lawsuits, more depositions, more financial experts. Years and years of litigation.
And for what? To ignore the inevitable train of collective bargaining roaring down the track.
The NCAA’s amateurism model is a giant octopus that has fed in the depths for decades upon decades, getting fatter and fatter and more detached from reality. Only now it has been forced into the shallows.
Now it’s holding on like grim death with every tentacle, desperate to return to the depths and take the cash with it. By spending tens of hundreds of millions in legal fees to protect future billions in revenue.
Maybe they know what they’re doing after all.
Matt Hayes is the senior national college football writer for USA TODAY Sports Network. Follow him on X at @MattHayesCFB.
