NCAA Rule Change Means (Some) College Athletes Will Get Paid (Eventually)

The NCCA relaxed its rule prohibiting college athletes from benefitting financially from their sports performance.

The NCAA has long held the stance that amateurism is a core requirement of college athletics, meaning the athletes should not benefit financially from their success on the field or court. Those athletes, meanwhile, see the millions of dollars schools earn from their (often short-lived) careers, and argue they deserve a share.

Both sides claimed victory after a federal appeals court ruling earlier this year, which said that, yes, the NCAA violates antitrust laws but, no, student-athletes should not be paid beyond recouping the costs of attending college. Plaintiffs in the case of O'Bannon vs. NCAA had requested that athletes receive up to $5,000 per year, but the court held that such payments would negate all claims of amateurism within college athletics.

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Since the plaintiffs asked for a review of the ruling, the battle over payment from schools remains active; but already the decision is prompting changes in NCAA policies, which could lead to athletes earning money from their time playing college sports. On Oct. 5, NCAA President Mark Emmert announced that players can sell their image, likeness and goods once they are no longer in college.

What the NCAA Rule Change Means for Athletes

Anything athletes can hold onto from their playing days—practice jerseys, swag bags, rings from bowl games—they can later sell, and do so freely once they are out of school. So if a college star were to quickly flame out in the pros (or not reach the pros at all), he or she could earn money by selling his/her leftover apparel and artifacts from their college days.

Also, if an athlete were to produce items (shirts, hats, mugs or whatever) carrying his or her own likeness, he/she could sell them and keep the revenue. Athletes could also sell images of their playing days—such as autographed photos—and keep the rewards.

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Perhaps the biggest opportunity for athletes to earn money will come in the form of video games. If a company such as EA Sports were to reboot their beloved college football franchise—which is rumored to be in the works—individual former athletes could negotiate directly with the company for the use of their likeness.

In all likelihood, the change will benefit the highest of high-profile athletes in major sports like football and basketball. But the NCAA's announcement is a major development for all players, current and former, because it marks the first time the NCAA has acknowledged that student-athletes have the right to benefit financially from their performance.

What Brought About the Change?

The changes were set in motion by the lawsuit brought by Ed O'Bannon, an All-American basketball star for UCLA in the mid-1990s. After leading the Bruins to the NCAA championship, O'Bannon was drafted by the New Jersey Nets, but his pro career was short-lived.

Years later, O'Bannon noticed that his image and likeness were being used without his consent in a video game. Along with Oscar Robertson and Bill Russell, he filed a class action lawsuit  against the NCAA. O'Bannon's suit alleges that the NCAA violated antitrust laws (the Sherman Act, an antitrust law intended to curb interference with free trade) by not allowing athletes to benefit financially benefit from their image or likeness.

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In a ruling last year, Judge Claudia Wilken ruled that the NCAA could no longer restrict colleges from paying athletes a share of the revenue they earn from sales of items using the athletes' names or images. Wilken assented to players on Football Bowl Subdivision teams and men's Division I basketball teams receiving payments for use of their names or images in the form of deferred compensation up to $5,000 per player.

In its previous ruling, which is now being appealed, the federal appeals court rejected Judge Wilken's ruling regarding the payment of $5,000 per player, calling it arbitrary at best. But the decision that the NCAA violates antitrust laws seems to be a win for athletes.

At least it's a win for some athletes. The reality is that most athletes will never see any money for their sweat. Even if payments to college athletes were to come to pass, the only sports that generate significant profits for their universities are football, basketball and men's tennis (who knew?). In most cases, the other sports not only fail to make money, they run deficits (which can reach up to $1 million per year). Colleges and universities continue to offer those sports to meet NCAA requirements for participating in high revenue-generating Division I basketball and football, where a championship can mean payouts of between $2,000,000 and $22,000,000.

The NCAA's recent policy change may be just the beginning, however. The association is currently in the midst of another court case, brought by former Clemson football player Martin Jenkins, which seeks a free market for college athletes to be paid. The ruling, which is expected in the coming weeks, could truly change the game for college athletes.

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