How Could a More Conservative Administration Affect the Name, Image, and Likeness (NIL) Ecosystem; Eight Ways!

The Name, Image, and Likeness (NIL) industry has revolutionized college athletics by allowing student-athletes to monetize their personal brands. However, a shift toward a more conservative U.S. administration could significantly reshape the NIL landscape. From judicial appointments and legislative control to potential Department of Labor rulings and tax law reforms.

Sen. Tommy Tuberville suggest penalties for athletes breaking contracts

For example, Senator Tuberville has proposed legislation that could characterize a more conservative approach to NIL under the incoming congressional administration, where Senator Ted Cruz will chair the Committee on Commerce, Science, and Transportation.

At a recent discussion with the Monday Morning Quarterback Club in Birmingham, Alabama, Senator Tommy Tuberville shared insights into the evolving landscape of NIL (Name, Image, and Likeness) in college sports and Congress's challenges in crafting effective legislation. Tuberville, a Republican senator from Alabama and former college football coach, previously co-sponsored the "Protecting Athletes, Schools and Sports Act of 2023" alongside Senator Joe Manchin. This bill aimed to standardize NIL contracts, override varying state NIL laws, and establish an agent registry managed by the Federal Trade Commission.

The legislation underscores the necessity of balancing athlete compensation with enforceable contract terms, suggesting that future NIL deals should include clear penalties for breaches. It also proposed limiting athletes' ability to transfer during their first three years of eligibility. However, the legislation did not advance to the Senate floor, leaving NIL governance fragmented. Tuberville emphasized the importance of enforcing penalties for athletes who break NIL agreements, advocating for contract integrity and accountability within the system.

I thought it might be fun to kick this idea around today and explore different ways the recent election could manifest a shift in laws, attitudes, and college athletic culture.

Eight ways a conservative administration could affect NIL

1) Supreme Court Dynamics

The Supreme Court has already played a pivotal role in shaping the NIL landscape. In the 2021 NCAA v. Alston decision, the Court unanimously ruled against NCAA restrictions on education-related benefits for student-athletes. While this case didn't directly address NIL, it set a tone favoring student-athletes’ rights.

A more conservative administration could influence the composition of the Court by appointing justices with a stricter interpretation of antitrust law. This shift might lead to decisions that favor NCAA autonomy or place limits on NIL freedoms. Historical conservative views on amateurism could resurface, potentially constraining the breadth of NIL activities.

Beyond the Supreme Court, federal judges appointed by a conservative administration might take a more critical stance on NIL-related lawsuits. Cases involving collective bargaining rights for athletes, NIL contract disputes, or federal antitrust issues could be decided with a stricter interpretation of existing laws, potentially reshaping the NIL playing field.

2) Legislative Dominance: Senate, House, and NIL Laws

Control of both chambers of Congress by a conservative majority could lead to federal NIL legislation aimed at creating uniformity but with a focus on limiting perceived excesses.

Possible changes might include:

• Caps on Earnings: Setting limits on how much athletes can earn under NIL deals to preserve the notion of amateurism.
• Eligibility Requirements: Restricting NIL deals to certain classes of athletes (e.g., upperclassmen or scholarship recipients).
• NCAA Empowerment: Granting the NCAA more authority to regulate NIL at a national level.

Such legislation could preempt the current patchwork of state laws, curbing the competitive advantages some schools enjoy based on their states' NIL-friendly policies.

3) State Law Changes: A Mixed Bag

States have been at the forefront of NIL regulation, with some enacting athlete-friendly laws and others maintaining stricter controls. A conservative wave at the state level could lead to:

• Tightened NIL Laws: Reducing the scope of permissible deals and increasing oversight of contracts.
• Focus on Transparency: Mandating disclosure of NIL agreements to athletic departments or state agencies.
• Educational Requirements: Requiring student-athletes to take financial literacy and contract law courses as a condition of NIL participation.

These measures might protect athletes from exploitation but could also dissuade sponsors or reduce the attractiveness of certain schools.

4) The Department of Labor: Employees or Not?

A critical question looming over college athletics is whether student-athletes should be classified as employees of their institutions. A more conservative Department of Labor might resist this classification, arguing that it undermines the amateur status of college sports and places undue burdens on universities.

However, if the National Labor Relations Board (NLRB) were to recognize student-athletes as employees, it could open the door to:

• Unionization and Collective Bargaining: Empowering athletes to negotiate wages, benefits, and working conditions.
• The Right to Strike: Allowing athletes to withhold their participation in games or practices as a bargaining tool.

A conservative administration might counter these efforts by supporting legislation to exempt student-athletes from employment laws, preserving the current structure of college athletics.

5) Taxation: From Nonprofit to Corporate Entity

One radical proposal under a conservative administration could involve reclassifying college sports programs as for-profit entities rather than nonprofit educational endeavors. Such a move would have profound implications:

• Taxation: Universities could face corporate income taxes on revenues generated by athletics, forcing a reevaluation of spending priorities.
• Investor Influence: To offset tax liabilities, universities might seek outside investors. Private equity firms or sports conglomerates could purchase stakes in athletic programs, fundamentally altering their governance and objectives.
• Conference Restructuring: Profit-driven models might prioritize high-revenue games and rivalries, leading to changes in conference alignments and playoff structures.

This shift could benefit elite programs with strong brands while leaving smaller schools struggling to compete.

6) Branding and Talent: Centralized Control

A more business oriented administration might favor or introduce legislation making it attractive for investors to buy OR invest in college sports teams and programs. If private investors gain influence over college sports, they might prioritize maximizing profitability. This could include:

• Brand Standardization: Streamlining logos, mascots, and uniforms to increase marketability.
• Talent Acquisition: Introducing draft-like systems for high school athletes to ensure an equitable distribution of talent across programs.
• Content Monetization: Centralizing media rights to control and maximize earnings from broadcasting, streaming, and merchandising.

While these measures might increase revenue, they could also erode the traditions and local identities that make college sports unique.

7) A Supreme Court Perspective on Taxation and Employment

Should cases related to taxation or employment status reach the Supreme Court, prior decisions like Alston and Citizens United (which affirmed broad corporate rights) might provide insight into potential outcomes. The Court’s approach could balance protecting student-athletes’ rights with preserving the traditional structure of college sports.

A conservative-leaning Court might:

• Rule against taxing college sports as corporations to maintain the status quo.
• Reject the classification of athletes as employees, aligning with historical amateurism principles.

Alternatively, the Court might surprise observers with rulings that redefine the economics of college athletics in ways that align with broader societal shifts.

8) Corporate investment in College Sports

If legislation and judicial decisions favor a more corporate structure for college sports, the NIL ecosystem could undergo a seismic transformation. This might include:

• Increased Commercialization: Shifting the focus from education to profit maximization.
• Enhanced Competitive Balance: Redistributing resources to level the playing field among programs.
• Erosion of Traditions: Losing the unique cultural aspects of college sports as profitability takes precedence.

A broader societal debate would likely emerge over whether these changes benefit or harm the essence of college athletics.

Conclusion

Bottom line? If you were hoping things would settle down and provide a platform you could start making long term decisions on, FORGET ABOUT THAT!

A more conservative administration has the potential to profoundly reshape the NIL industry and college sports at large. By influencing judicial appointments, legislative priorities, and regulatory frameworks, such an administration could redefine the balance between amateurism and commercialization. As stakeholders across the collegiate ecosystem—athletes, universities, sponsors, and fans—grapple with these possibilities, thoughtful discourse and proactive planning will be essential to navigate the road ahead.

The NIL landscape stands at a crossroads, and its future will depend on the interplay of politics, law, and economics. While this article takes no position, it invites you to reflect on how these changes might impact the cherished institution of college sports.

What do you think?

How should stakeholders prepare for a possible new reality in college athletics? Let’s continue the conversation.