Is NIL really ruining Olympic sports?

You may have seen the NBC Sports story that’s been making the rounds on social media today suggesting that Olympic athletes are a dying breed due to those pesky college football players stealing all the money that used to fund their sports. It is, to say the least, a problematic take. But is it entirely wrong? I’ve reported on NIL quite a bit, so let’s dig in to the realities.

Let’s go through the story, which was written by Noah Pranskey and can be found HERE.

Don’t let this last part be a throwaway line, as it so often is. If college sports were treated as a real business — which it is! — no one would be arguing that too much attention is given to the only products that turn a profit. Now, if the NCAA rebranded as Meta, that’s a different story…

Ah, I just love stories of “economic anxiety.” I genuinely wonder how many people who espouse this theory also devoutly crusade against wealth redistribution in every other aspect of life. The truth is, the U.S. is alone in shifting the responsibility of preparing Olympic athletes from the government to universities (just as it is unique in allowing universities to essentially be a minor league for pro sports). If the U.S. acted in any way like other countries, the USOC would be on the hook for funding these sports. Whether it is a good or bad thing that we do it differently here is a worthy debate, but let’s not act like the U.S. would simply disappear from the Olympics if colleges didn’t fund athletic training.

First off, NIL is absolutely NOT allowing athletes to “share a piece of the profit pie.” None of the NCAA, conference or school “profits” are going directly to athletes beyond their scholarship and “educational benefits,” which is a nebulous term that will be at the center of the “athletes as employees” debate. This, however, is about the Alston ruling, not NIL.

Additionally, Kristi Dosh is an exceptional reporter and knows more about NIL than anyone, and it should be noted here that her quotes is discussing a) something different than NIL, and b) what the school’s perspective is, not what her perspective is.

Lastly, let’s point out that any economic system has its advantages. Slavery, for example, made a lot of folks rich and made the cost of crops like cotton cheaper for everyone. That economic boon was possible because of a massive moral failing. So whatever the economic fallout of treating athletes as employees might be, the single most critical issue in the discussion is whether the current system is legal (or moral).

Here is some very good data that is not at all related to the premise of the story.

First off, hard to blame NIL — a thing that took effect in 2021 — for events that happened between 2001 and 2020.

Second, all those programs cut in 2020… can you think of anything else that might’ve been going on in the world that year?

Lastly, note the sports mentioned here. MENS swimming. MENS tennis. MENS gymnastics. MENS wrestling. The reason there are fewer scholarships available in these sports is because, starting around 2001, there was drastically more enforcement of Title IX, which previously had largely been ignored by schools beyond some basic window dressing.

Here’s a point of distinction: The NCAA does not mandate how many Olympic sports schools sponsor or how much those schools spend on those programs. That’s determined by the schools themselves. And yes, those schools’ athletics departments are run like a business, which is entirely reasonable. Because if football and basketball struggle, that also hurts the bottom line — significantly more than if the other sports struggle.

As Matt Brown has written many times, Olympic sports are actually a source of revenue for most schools. Or, I simply googled and found this good piece from the BC student newspaper. Places like Stanford, however, sponsor far more sports than average, and much of that is paid for not simply through football, but through earmarked donor support. And, as is also noted in this story, programs that were cut were, in many cases, reinstated.

The assumption here is that our system is better. Maybe it is. But the fact that no one else does it this way should force the question of whether we should be doing it this way, too. If nothing else, it’s an incredibly inefficient way of doing it because, while the system does give Olympic athletes an athletic and academic platform, it does the same for thousands of other athletes, too. Only about 1,000 U.S. athletes participate in the Olympics, and only about 750 of them trained in a college program. That’s a very small percentage of the total number of non-revenue sport athletes currently being supported by football and basketball money. If the goal is simply to create Olympic athletes, then there are far more cost-effective ways to do this.

We’re way into this story now, and I’ve yet to read a single word tying NIL to anything of substance in the piece. A lot of talk of nebulous “changes” but not NIL. Interesting that the headline suggests NIL is at the heart of the problem. It’s almost as if NIL has to be used to shift the blame to greedy athletes instead of the schools actually making investment decisions.

In other words, if these sports were forced to also act like businesses and find cost effective ways of operating, they’d be better prepared for a changing college sports landscape. What a novel concept!

The fact is, for better or worse, spending on non-revenue sports has skyrocketed at a roughly proportional rate as revenue for football and basketball has increased. They’ve benefited massively from those sports’ success, and quite frankly, they don’t all *need* the kind of money that’s in their budget. Alabama’s softball coach makes more than $300,000 a year. That’s great, but it’s not necessary to have a softball program. It’s possible because football brings in such massive amounts of money.

Hey, our first real mention of NIL and… it’s about how great it is!

And here’s the thing: It IS great. NIL can be a boon for Olympic sports, too. Athletes like LSU gymnast Olivia Dunne are so high profile that her NIL promotions are actually a great window into the world of collegiate gymnastics. In the longterm, giving athletes like Dunne a bigger platform for earning money can translate to more fans, more participation, and … more revenue!

Now, here’s where I’m going to play devil’s advocate for a moment: NIL is not without its problems, and yes, it might be impacting athletics budgets (a little) and could do so down the road (a lot).

I spoke with Jim Cavale, CEO of INFLCR, for a story last week. He did a nice job of summing up where things stand with NIL, 6 months into the new world order.

[Schools] quickly realized you couldn’t just answer NIL and recruiting as a coach with ‘We’re going to help you grow your followers on social.’ You had to have some deals, some deal flow to talk about when you were recruiting. The easiest way to do that and start to think about the entire team was to be creative and get them all paid — but if you’re doing that without fulfillment, it starts to really make you wonder if it’s NIL or pay-for-play. The folks who think it’s NIL just say it’s non-traditional vs traditional. But others will say it’s legitimate vs. illegitimate. And that’s going to become a center stage argument in 2022 as booster collectives emerge.

There’s a lot to unpack here, but the basics are:

  • There are lots of genuine NIL deals happening out there reflective of what any other sort of sponsorship and advertising would look like. Folks like FSU’s Dillon Gibbons have done a wonderful job of using NIL for charitable purposes and others, like Kenny Pickett, spun their NIL success into perks for their teammates. But those deals take time, effort and, often, celebrity. Most student-athletes do not have excess of any of those things.
  • A lot of recruits — both high school and in the portal — want NIL money and coaches want to give it to them, while skipping the middle man of actually finding a company to partner with an a fulfillment item (like an ad or a social post) that warrants the investment. So boosters for individual schools are setting up NIL “collectives” which essentially funnel money to those athletes and get them paid. For what? That’s the problem.
  • NIL should inherently be tied to YOUR name YOUR image and YOUR likeness, which should, of course, be transferable wherever you go. But these “NIL” deals are instead tied to you going to a specific school. That’s not at the heart of what NIL was supposed to be.
  • Booster collectives are, largely, not a violation of the rules — mostly because there are no rules. It’s a free-for-all, and the NCAA chose for that to be the case. There was ample time to form a framework for NIL, but NCAA leadership and its member institutions decided to punt.
  • Those booster collectives probably are taking money out of the pockets of athletics departments, as it’s entirely likely some portion of that money would’ve gone to donations to the school rather than directly to the players.

So, is NIL hurting athletics budgets? Probably not in the short term. But if this is the first step toward pay-for-play, athletes as employees, unionization, etc., then yeah, there’s a real chance that athletic department budgets will take a real hit.

Of course, that also forces the question: Is that a bad thing? If the market suggests players could’ve commanded more money, and the courts agree that they’re employees who should be paid — well, then those changes to the budget are a necessary outgrowth of correcting a flawed system.

Moreover, this isn’t necessarily all bad for Olympic sports. For one, Olympic athletes — i.e. athletes from non-revenue sports with a real shot at the Olympics — might be able to command more money themselves.

Second, if football, for example, is deemed to be a business apart from the school, and its athletes are employees, then it is exempt from Title IX, and therefore wouldn’t tilt the scales so far toward men’s scholarships that other men’s sports must be cut.

Lastly, there will always be boosters willing to fund non-revenue sports. Sometimes it’s because their kid plays that sport… or they did when they were in school… or they just like the sport… or they want some power within the athletics department and they aren’t a big enough fish for football… or any number of other reasons.

Long story short, NIL and player empowerment are likely both necessary and inevitable, and once again, we’re blaming the players for the flaws in the system created by administrators and taken advantage of by coaches and recruiters.

Leave a Reply

Fill in your details below or click an icon to log in: Logo

You are commenting using your account. Log Out /  Change )

Twitter picture

You are commenting using your Twitter account. Log Out /  Change )

Facebook photo

You are commenting using your Facebook account. Log Out /  Change )

Connecting to %s