The Clearinghouse can't limit the amount of legit endorsement deals but they will have the capability of identifying and rejecting endorsement deals disguised as Pay for Play that are clearly outliers from their FMV endorsement deal comps. The burden of proof will then be on the business to prove that it's not via arbitration and the FMV standard will not be based on "whatever the business (i.e. booster) is willing to pay" BS that is constantly repeated here.I'm not trying to argue, I would love everything I say to be wrong
I posted the legal definition, of which would stand up in any court in the land, regardless of any sort of clearinghouse, CBA, salary cap, etc. FMV can be capped on things like commodities, eminent domain, etc because there is a very clear ability to compare one asset to another based on locality, prior sales, historical trends, supply/demand, etc - but not on what an individual can make for "services rendered" or not in an endorsement or sponsorship deal.
You can't compare athlete A to B or trends because they all have different attributes and their value is dictated by the school's need, the sponsor's desires, the player, the locale, National visibility, the player's demands, team success, etc. The only way you could try to determine some sort of FMV would be to look at something like recruiting ranking or something crazily arbitrary like that. That would be absolutely bonkers.
But that still doesn't hold up. Arch Manning at Texas is going to be worth a hell of a lot more than a higher ranked in-state QB that goes to Iowa State.
Let's use this as an example. The median salary for a Fortune 500 CEO is $17mil/year. But it ranges from the highest - TPG Inc at $199mil/year to the lowest - Warren Buffet at $413K/year. Most have some sort of additional, non-salary compensation that can be worth vast ranges. Nothing but shareholders can control those salaries or the compensation packages, because company performance alone isn't a one-to-one evaluation.
The Clearinghouse that is being pushed through is specifically regarding pay to play, not pay to sponsor/endorse.
Again, the Clearinghouse will be effective in concept for limiting what schools and collectives can pay athletes, that's a great move in itself. Nothing however will be able to limit the endorsement deals, it's outside of the control of the Clearinghouse. IF the Clearinghouse tried to limit it, it would fail quickly at the first sight of a lawsuit.
NCAA set to allow direct payments to athletes
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That just becomes a contractual language issue. You can't say you have to play for Iowa State, but you can say that you have to be available when needed in Central Iowa for autograph sessions, ads, etc during the months of August through January. It wouldn't even need for those obligations to be followed through on if worded correctly (i.e. be available vs perform 3 sessions per month).
Sorry, but how are there not similar deals? There's a million examples of athletes advertising a company.
I'm not trying to argue, I would love everything I say to be wrong
I posted the legal definition, of which would stand up in any court in the land, regardless of any sort of clearinghouse, CBA, salary cap, etc. FMV can be capped on things like commodities, eminent domain, etc because there is a very clear ability to compare one asset to another based on locality, prior sales, historical trends, supply/demand, etc - but not on what an individual can make for "services rendered" or not in an endorsement or sponsorship deal.
You can't compare athlete A to B or trends because they all have different attributes and their value is dictated by the school's need, the sponsor's desires, the player, the locale, National visibility, the player's demands, team success, etc. The only way you could try to determine some sort of FMV would be to look at something like recruiting ranking or something crazily arbitrary like that. That would be absolutely bonkers.
But that still doesn't hold up. Arch Manning at Texas is going to be worth a hell of a lot more than a higher ranked in-state QB that goes to Iowa State.
Let's use this as an example. The median salary for a Fortune 500 CEO is $17mil/year. But it ranges from the highest - TPG Inc at $199mil/year to the lowest - Warren Buffet at $413K/year. Most have some sort of additional, non-salary compensation that can be worth vast ranges. Nothing but shareholders can control those salaries or the compensation packages, because company performance alone isn't a one-to-one evaluation.
The Clearinghouse that is being pushed through is specifically regarding pay to play, not pay to sponsor/endorse.
Again, the Clearinghouse will be effective in concept for limiting what schools and collectives can pay athletes, that's a great move in itself. Nothing however will be able to limit the endorsement deals, it's outside of the control of the Clearinghouse. IF the Clearinghouse tried to limit it, it would fail quickly at the first sight of a lawsuit.
That is not what I've heard others describe. The Clearinghouse would have nothing to do with what the schools are paying. It would be on what players get outside of that.
The NCAA couldn't limit what Person A pays Person B, but if laws are passed, they could say Person B is not eligible to play NCAA sports if Person B takes money from Person A.
NIL is more than just the assumed commercial ROI for a business buying an advertisement or endorsement
It is simply players getting paid for their name, image, or likeness. All of which are highly dependent on what name, image, or likeness we’re talking about
If some Cyclone fan wants to pay Jefferson $2 million for exclusivity on his autograph, particularly of Cyclone memorabilia or merchandise, that’s NIL. Some may say that’s overpaying, but not to a huge fan that gets value from conspicuous consumption- in which case, the more they pay, the more they can flex it and feel superior
If I sold the aforementioned memorabilia at $2 million to the same fan, I’m paying tax based on the $2 million sale price, not based on a comp of what the memorabilia often go for
Fighting FMV is going to be prohibitively expensive in both time and money- remember, the P4 are paying for the regulation and enforcement. They will want easy wins in which the fines will recover some of the costs of the Clearinghouse
Adjudicating whether payments are inducement or NIL may be possible in some instances. It’s not whether the amount was past FMV, it’s that the buyer didn’t structure the deal properly, and inducement easy to prove.
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As some have said, I'm pessimistic this will do anything. NIL is still going to be a thing, and the most money will win. ISU's ability to compete at the highest level is a rapidly closing window.
Coaches like Campbell and Otz, who excel on developing player into young men -- which is the true talent in coaching -- will lose out to lesser coaches and programs who can buy whoever they want. They will soon find themselves in beat them (futile) vs. join them decisions.
Coaches like Campbell and Otz, who excel on developing player into young men -- which is the true talent in coaching -- will lose out to lesser coaches and programs who can buy whoever they want. They will soon find themselves in beat them (futile) vs. join them decisions.
I'm not talking about school budget, I'm talking about NIL budget. This system will still end up letting the high dollar NILs do what they want, and the low budget NIL schools like us will continue to be at a disadvantage.
Nope. FMV requires both parties to be seeking the best value possible. Somebody paying $2M for autographs when he could get the same thing for $50k is not that. The $1.95M is the part the clearing house will deem pay for play and invalid.
Lol
In this example , Jefferson is selling exclusivity to his autograph for $2 million. You can’t get the same thing for $50k, as a different autograph isn’t the same NIL. Non-fungible. Period.
There’s plenty of precedent for this. Certainly enough to make it prohibitively costly for the Clearinghouse to fight it.
I look forward to the Clearinghouse coming down hard on modest NIL of schools well below the revenue sharing cap- the ones that aren’t generally of high value to the decision makers and can’t afford to fight back
Say a $500k NIL deal doesn’t push the total athletic department roster compensation above the cap. It’s still going to need to be pursued and fined, even though schools could legitimately launder that through the AD revenue mechanisms, for instance as ticket revenue.
FMV isn’t going to do much regardless, but having these poorer schools with de facto approved NIL would just further eliminate any chance at the efficacy of FMV
Say a $500k NIL deal doesn’t push the total athletic department roster compensation above the cap. It’s still going to need to be pursued and fined, even though schools could legitimately launder that through the AD revenue mechanisms, for instance as ticket revenue.
FMV isn’t going to do much regardless, but having these poorer schools with de facto approved NIL would just further eliminate any chance at the efficacy of FMV
Trading cards, art, NFTs…and imo really any asset that’s bought/sold in a market with a lack of liquidity
1 player getting paid $2M for autographs is an outlier and clearly not FMV. But you won’t have one player. You will have dozens of SEC and B1G programs with well funded collectives offering $2M to tons and tons of players. So now $2M isn't an outlier, it is the common going rate for a SEC or B1G caliber player's autograph exclusivity, and now you have the market data to back it up. The clearinghouse will end up being used to further legitimize pay for play NIL. Just like the wealthy programs want it to.
There are no True NIL deals under the AD RevShare cap so your entire post here is displaying your ignorance.
100% of AD RevShare dollars paid to athletes is 1099 pay for play and the only thing that Deloitte will audit is whether or not the total RevShare cap was exceeded.
And rejected NIL deals by the Clearinghouse disguised as Pay for Play won't be fought by the schools, they will be fought by the athletes & boosters/vendors trying to get the deal approved. The school won't be involved.
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Right because if Ohio State's quarterback gets dinged and ruled ineligible by this farce of a clearinghouse, they'll just say 'shucks, guess we lost him' and move on.
The Clearinghouse wouldn't necessarily rule him ineligible, the submitted deal from the rogue booster would be rejected and the kid could still play.
You can't compare these deals with other CFB or CBB deals. You compare to deals outside of those industries where there is no incentive to massively overpay with intentions outside of just true NIL.
