Some details on the NIL Clearinghouse...

[Dawgzilla2]

YAHOO sports

some interesting stats on the size of NIL deals and the Enforcement plan. Their algorithm allegedly already factors in the size of the market and the popularity of the player, so they fully expect players at big schools to make more money.

This will all be quite interesting.

 

[patdog]

YAHOO sports

some interesting stats on the size of NIL deals and the Enforcement plan. Their algorithm allegedly already factors in the size of the market and the popularity of the player, so they fully expect players at big schools to make more money.

This will all be quite interesting.

So basically we’re gonna get screwed even if we could come up with the money to compete against the big schools.

 

[Xenomorph]

So the algorithm will grant approval for Bama to pay a player more than State because Bama pays players more than State.

 

[anon1758050382]

So basically we’re gonna get screwed even if we could come up with the money to compete against the big schools.

I think it's more complicated than that.

Deloitte officials claim that 70% of past deals from booster collectives would have been denied in their algorithm, while 90% of past deals from public companies would have been approved. Deloitte has also shared with officials that about 80% of NIL deals with public companies were valued at less than $10,000 and 99% of those deals were valued at less than $100,000.

Being in a big market doesn't mean you can pay your LT seven figures and call it NIL. Even an impact player in a big market is probably worth less than $100k in actual NIL. To get him to seven figures, you would have to pay him with rev share dollars (capped at $20.5MM/year for the whole school).

I think the bigger issue is when this all gets torn apart in the courts once a deal is denied and the player sues.

 

[Bulldog45]

“The size of the market”….so UGA’s proximity to Atlanta makes them a larger market than Starkville or Oxford, therefore they are allowed to pay a player more?

 

[anon1758050382]

“The size of the market”….so UGA’s proximity to Atlanta makes them a larger market than Starkville or Oxford, therefore they are allowed to pay a player more?

It's no different from pro players in New York and LA having bigger endorsement deals than players in smaller markets. The franchises are still subject to the same salary cap.

I'm not saying it will hold up in court, but the concept isn't new.

 

[ckDOG]

"Is the deal for a “valid business purpose?" The third-party business, brand or individual must be receiving true value from the activities, such as an autograph session, television commercial or speaking engagement."

That's the part that potentially has the ability to level the playing field a quite a bit. Most of these NIL deals don't pass a valid business purpose test. They are slush funds to get kids to commit and then the economics fall off a cliff. You can't tell me that a kid getting say 20k a month to show up at an autograph table passes any sort of legitimate FV test for the services provided.

Will Deloitte be strict on this and help eliminate the fan/associated company funded slush funds or are they just going to rubber stamp stuff and pretend their algorithm rationalizes these deals to the benefit of big market teams? I won't be holding my breath.

 

[onewoof]

If an institution other than the school, booster or program pays someone other than the player, it's legal. Been happening that way for 50+ years

 

[mstateglfr]

Restricting potential earnings is a 17ed scenario.

It's unjustifiable to allow players to profit off their name, image, or likeness...but then cap their profit by tying it to an algorithm that claims to justify the value of one's name, image, or likeness.

If someone is willing to pay me $1MM for my job, then my job is worth $1MM.
If someone is willing to pay a QB $1MM for their name to be associate with whatever the 17 gizmo, then their name is worth $1MM for that deal.

I understand the counter to this argument and I preach it all the time when it comes to coaching salaries. But me comaining is worlds different from me endorsing a pay cap based on an algorithm.

 

[Xenomorph]

Restricting potential earnings is a 17ed scenario.

It's unjustifiable to allow players to profit off their name, image, or likeness...but then cap their profit by tying it to an algorithm that claims to justify the value of one's name, image, or likeness.

If someone is willing to pay me $1MM for my job, then my job is worth $1MM.
If someone is willing to pay a QB $1MM for their name to be associate with whatever the 17 gizmo, then their name is worth $1MM for that deal.

I understand the counter to this argument and I preach it all the time when it comes to coaching salaries. But me comaining is worlds different from me endorsing a pay cap based on an algorithm.

Listen up College Athletics!… when glfr starts making sense y’all are 17ed.

 

[Dawgg]

Sounds like the “why in the world would somebody move from California to Mississippi?” rationale the NCAA used to punish Renardo Sydney.

 

[Maroon13]

It's makes sense to me. Larger population states with more businesses will have more nil opportunities.

Teams that win more will have more nil opportunity. For example: Bryce Young had a subway commercial. Ewers had the Dr Pepper commercial. Ain't nobody from Slippery Rock going to get those deals.

 

[ckDOG]

Restricting potential earnings is a 17ed scenario.

It's unjustifiable to allow players to profit off their name, image, or likeness...but then cap their profit by tying it to an algorithm that claims to justify the value of one's name, image, or likeness.

If someone is willing to pay me $1MM for my job, then my job is worth $1MM.
If someone is willing to pay a QB $1MM for their name to be associate with whatever the 17 gizmo, then their name is worth $1MM for that deal.

I understand the counter to this argument and I preach it all the time when it comes to coaching salaries. But me comaining is worlds different from me endorsing a pay cap based on an algorithm.

But much of it (NIL collectives) really aren't payments for their name, image, and likeness in reality. It's back door compensation to play football churched up as marketing deals with no real marketing involved - or at least much less than the dollars/services indicate.

We have many professional leagues with salary caps. No reason we can't here either. What it sounds like they are attempting to do is separating legitimate NIL deals and something that is a back door way to pay a kid more salary to play.

Examples: 1) FedEx pays not a Memphis kid money to be in commercials bc FedEx sees value in that. Have at it, kid. 2) Fred Smith drops $10M in the NIL slush fund to buy an all American QB and WR room for the Memphis tigers. Bad thing for a league that you want to be competitive and stable over the years. Same thing as the Lakers ownership writing checks directly to the roster labeled as "NIL" to skirt the salary cap/luxury tax rules. Roster can get endorsement deals all they want but the owners shouldn't be skirting compensation caps to get a competitive advantage.

 

[patdog]

I think it's more complicated than that.

Being in a big market doesn't mean you can pay your LT seven figures and call it NIL. Even an impact player in a big market is probably worth less than $100k in actual NIL. To get him to seven figures, you would have to pay him with rev share dollars (capped at $20.5MM/year for the whole school).

I think the bigger issue is when this all gets torn apart in the courts once a deal is denied and the player sues.

It’s really not more complicated than that. But you’re right. If they start denying NIL deals there’s gonna be lawsuits all over the place. And the Clearinghouse will not win. If someone is willing to pay, it’s market value.

 

[ckDOG]

It’s really not more complicated than that. But you’re right. If they start denying NIL deals there’s gonna be lawsuits all over the place. And the Clearinghouse will not win. If someone is willing to pay, it’s market value.

Depends on if they ever get to a CBA environment or not. If it's a free for all with no agreed upon framework by all parties then you are right. If they paper this all up like a real professional league they could better regulate the dollars. Or at least force slush fund booster dollars back under the table where they belong.

 

[patdog]

Depends on if they ever get to a CBA environment or not. If it's a free for all with no agreed upon framework by all parties then you are right. If they paper this all up like a real professional league they could better regulate the dollars. Or at least force slush fund booster dollars back under the table where they belong.

I don’t see a collective bargaining agreement in the future. Why would the players bargain? They already have full free agency twice a year & no real limits in compensation and they’ll win extended (maybe unlimited) eligibility in the courts soon. And if the clearinghouse starts denying NIL deals they’ll sue & win that too.

 

[ckDOG]

I don’t see a collective bargaining agreement in the future. Why would the players bargain? They already have full free agency twice a year & no real limits in compensation and they’ll win extended (maybe unlimited) eligibility in the courts soon. And if the clearinghouse starts denying NIL deals they’ll sue & win that too.

Correct. The high dollar big 2 sports wouldn't want a CBA. But they are outnumbered by the other student athletes. Perhaps the member institutions could throw a bone to them with a commitment to the non-rev sports. Those plus the the percentage of the football rosters that don't get much could sign on if they get a nice piece of the rev share pie. There are probably carrots to dangle at the masses to the detriment of the kids that can command big dollar NIL and transfer often. No clue if realistic or even the member institutions are even motivated to go that route. But point being there is a minority count of SA's driving the system that is chaotic. That presents opportunity to balance the system with the masses of nameless athletes (if the universities even want to keep them around)

 

[mstateglfr]

But much of it (NIL collectives) really aren't payments for their name, image, and likeness in reality. It's back door compensation to play football churched up as marketing deals with no real marketing involved - or at least much less than the dollars/services indicate.

We have many professional leagues with salary caps. No reason we can't here either. What it sounds like they are attempting to do is separating legitimate NIL deals and something that is a back door way to pay a kid more salary to play.

Yeah, it's absolutely a way to back door pay a kid more salary to play.
...but if someone can profit off their name, they they should be allowed to profit off their name. Restricting how much they can profit off their name is unjustifiable, if we follow the concept that players can profit off their name, image, and likeness.

Paying a kid $1MM to play at State means that kid's name is worth that amount of money to that payer.

To claim that amount of money is unjustifiable is both arbitrary and restrictive.
When people are arbitrarily restricted from earning money, they sue, as they should.


I get that there is an ideal view where players work and earn their NIL money thru endorsements and commercials and appearances.
But trying to place work requirements around NIL pay, like you have to work X hours to earn Y money will also end in lawsuits, as it should.


If I think a guy is worth paying $200K to play in Maroon and White, then that kid's name, image, and likeness is worth that money.

 

[ckDOG]

Yeah, it's absolutely a way to back door pay a kid more salary to play.
...but if someone can profit off their name, they they should be allowed to profit off their name. Restricting how much they can profit off their name is unjustifiable, if we follow the concept that players can profit off their name, image, and likeness.

Paying a kid $1MM to play at State means that kid's name is worth that amount of money to that payer.

To claim that amount of money is unjustifiable is both arbitrary and restrictive.
When people are arbitrarily restricted from earning money, they sue, as they should.


I get that there is an ideal view where players work and earn their NIL money thru endorsements and commercials and appearances.
But trying to place work requirements around NIL pay, like you have to work X hours to earn Y money will also end in lawsuits, as it should.


If I think a guy is worth paying $200K to play in Maroon and White, then that kid's name, image, and likeness is worth that money.

Are you of the opinion this new world is the end of salary caps in professional leagues bc some free market ideals? I'm simply saying the kids will and should be able to profit bigly off their legitimate marketing deals but more scrutiny will be paid to paying them higher than the rev share through back door arrangements that aren't based on marketing value at all.

Say it would cost us $200k to get the backup right guard to sign above and beyond the rev share component he's entitled to. Odds are you or I or the standard MSU fan isn't going to know his name or recognize his face. The NIL part is pretend - he's not creating any value for whoever pays it beyond their enjoyment in football production - which is now intended to be capped.

You can value a purely free system and that's fine. I personally despise that system and why I think professional baseball inferior to football/basketball from a competitive standpoint.

I think it's obvious the decision makers desire a capped system given the rev share limit and scrutiny that will be placed on the 3rd party NIL aspect. Will we ever get there legally without a CBA? Probably not. I hope we get there though.

 

[Villagedawg]

So basically we’re gonna get screwed even if we could come up with the money to compete against the big schools.

Did we expect anything different? ‘Merica!

 

[TheBannerM]

I think State at least *tries* to get value out of their NIL deals through community outreach and such like the literacy program they’ve been advertising.

 

[ronpolk]

The example the article gave was that Georgia tech would in theory have more influence/popularity in Atlanta compared to Georgia state, so a NIL deal to a player for GA Tech, from an Atlanta company, could be bigger than for Georgia State. That just seems like common sense to me. There is always room for someone to get screwed but I don’t think state will get screwed on this, it’ll be more the southern miss of the world.

 

[Dawgzilla2]

Here's the thing...legit NIL deals are fine. Faux NIL deals that include extra money are actually pay for play, which are being disallowed. The collectives are essentially being put out of business, except to the extent they are helping athletes find legit NIL deals.

No one is limiting the amount of money a player can get for their NIL...they are attempting to elinate pay for play.

If someone is willing to pay $1MM for an endorsement deal, then that is FMV....but only if it's an arms length deal. If the $1 MM is coming from a booster, and his business is not receiving $1MM worth of advertising from the contract, then it's more likely a deal to reward the player for playing at that school, which isn't allowed.

I don't think a perfect system for this can be devised, and there will no doubt be complications, but I think the system itself will hold up to most legal challenges. The issue will always be gauging fair market value, and the courts may have an opinion on that

If a player who opted out of the settlement gets an NIL deal reduced and wants to sue, though, He's going to need to provide proof that his contract is a legit NIL deal. I don't think it's an antitrust violation for the NCAA to deny pay for play. In Mississippi, it is currently illegal for an athlete to be paid to participate in intercollegiate athletics. And such a contract is arguably unenforceable, for lack of consideration on the part of the player (the only arguable consideration is the player didn't transfer to another school where he also could not get paid).

My concern is the built in increase in FMV for the bigger schools. They aren't saying BAMA gets to pay it's players more because it has always paid them more. They are saying an athlete who plays for a school with more fans logically has a more valuable image.

So, if a Bama player gets paid $100k to appear in a Coke ad, an MSU player may have to accept less money for a similar ad. That seems unfair on its face.

I also don't like the advantage this gives to Basketball schools, like in the Big East. If a school already has a small football program, they can spend the bulk of their revenue sharing on basketball and pretty much dominate.

 

[ckDOG]

The example the article gave was that Georgia tech would in theory have more influence/popularity in Atlanta compared to Georgia state, so a NIL deal to a player for GA Tech, from an Atlanta company, could be bigger than for Georgia State. That just seems like common sense to me. There is always room for someone to get screwed but I don’t think state will get screwed on this, it’ll be more the southern miss of the world.

Yeah I read it as a smell test thing. I'd expect a deal with a State player and Hancock Whitney to be valued less than a deal for a deal between a Ga Tech player and Hyundai. Doesn't mean it couldn't happen the other way on a deep dive but it would be a red flag if the State player was getting 2x the Ga Tech kid.

 

[TheBannerM]

Yeah I read it as a smell test thing. I'd expect a deal with a State player and Hancock Whitney to be valued less than a deal for a deal between a Ga Tech player and Hyundai. Doesn't mean it couldn't happen the other way on a deep dive but it would be a red flag if the State player was getting 2x the Ga Tech kid.

HW is giving money to LSU players before they would State. Unfortunately.

 

[L4Dawg]

As I said in the other thread, this would never have happened if the big boys didn’t think it would help them. None of this has been or ever will be good for MSU.

 

[Bulldawg77]

As I said in the other thread, this would never have happened if the big boys didn’t think it would help them. None of this has been or ever will be good for MSU.

Do you just enjoy being wrong all the time. This isn’t 1995… We have resources we have money and ability. Stop with this po ol state mentality

 

[Podgy]

As I said in the other thread, this would never have happened if the big boys didn’t think it would help them. None of this has been or ever will be good for MSU.

This is America. It's better to be rich than poor. Smart, rich people know how to arrange outcomes in their favor. We're in the SEC, a wealthy conference. We're not CUSA and I don't think there some unironic CUSA CUSA CUSA chant that's conference wide. We're the poor family in the neighborhood, well maybe middle class. Better find a sport that draws attention that we can compete in and keep fans satisfied. Not sure if that's gonna be football.

 

[Dawgzilla2]

As I said in the other thread, this would never have happened if the big boys didn’t think it would help them. None of this has been or ever will be good for MSU.

You think there was some way to resolve the anti-trust issues and maintain competitive balance at the same time? I think the pro leagues would be interested if you know a way.

Since the amateur athlete model no longer exists, the players are going to be able to profit off the use of their NIL through endorsement deals, social media, and the like. They should be allowed to do that.

And any system where the players can profit from endorsement deals is going to favor players at schools with larger fan bases and bigger markets. There is no way around that.

And that in turn will affect where players want to be. It doesn't shut out small schools in small markets, but it's a disadvantage.

 

[99jc]

This is America. It's better to be rich than poor. Smart, rich people know how to arrange outcomes in their favor. We're in the SEC, a wealthy conference. We're not CUSA and I don't think there some unironic CUSA CUSA CUSA chant that's conference wide. We're the poor family in the neighborhood, well maybe middle class. Better find a sport that draws attention that we can compete in and keep fans satisfied. Not sure if that's gonna be football.

As a rich SOB I approve of this post!

 

[OG Goat Holder]

I don’t see a collective bargaining agreement in the future. Why would the players bargain? They already have full free agency twice a year & no real limits in compensation and they’ll win extended (maybe unlimited) eligibility in the courts soon. And if the clearinghouse starts denying NIL deals they’ll sue & win that too.

I 100% agree. Every one thinking there is going to be this breakaway that results in salaries and contracts are just fooling themselves.

There may very well be a break away, but it will just be to hoard more of the money and pay more to players.

 

[OG Goat Holder]

The example the article gave was that Georgia tech would in theory have more influence/popularity in Atlanta compared to Georgia state, so a NIL deal to a player for GA Tech, from an Atlanta company, could be bigger than for Georgia State. That just seems like common sense to me. There is always room for someone to get screwed but I don’t think state will get screwed on this, it’ll be more the southern miss of the world.

I agree. Couple of things:

- For any famous player, the market is nationwide. Due to the internet, social media, TV, etc., geographic location really does not matter.
- After the famous players, it's the second tier where it gets tricky. It's about care level, and who cares more, MSU alumni scattered throughout MS and surrounding regions, or a bunch of city folks and companies in downtown Atlanta? I think MSU wins that battle for right now. U of Georgia is a different animal entirely, obviously. But I think our alumni that will hand out money for appearances for small businesses probably trumps the idea that Google, Mercedez, Chick Fila, Delta, Home Depot, Coke, etc. is going to care enough to prop up GT players. Even though they are obviously much much bigger.

There's always the possibility of some alumni that owns these companies getting involved in NIL, like Phil Knight or that guy in Louisville. But again, that's showing the care level needed. In a lot of cities, there's just more stuff to do that worry about college football. I don't really even know if Miami or USC can even amass the interest needed to succeed in this world. Well, I guess that lawyer down in Miami is buying everybody but that's not the norm, again, that's a Miami guy trying to help his same school.

Another is SMU....those are alumni who want to win, not a bunch of DFW area companies trying to make money off advertising. Because if you get real about it......the true market reach for any of these players outside the top 1% is not great. Johnny Manziel, Dak, Travis Hunter.....those types command real money but the rest - it's all just alumni wanting to win at all costs.

 

[L4Dawg]

Do you just enjoy being wrong all the time. This isn’t 1995… We have resources we have money and ability. Stop with this po ol state mentality

Yes, we have more money than we did....and so does everybody else.

 

[L4Dawg]

This is America. It's better to be rich than poor. Smart, rich people know how to arrange outcomes in their favor. We're in the SEC, a wealthy conference. We're not CUSA and I don't think there some unironic CUSA CUSA CUSA chant that's conference wide. We're the poor family in the neighborhood, well maybe middle class. Better find a sport that draws attention that we can compete in and keep fans satisfied. Not sure if that's gonna be football.

Football pays the bills for the other sports. Spending a lot of money on a non-rev sport like baseball or women's basketball is just stupid.

 

[L4Dawg]

You think there was some way to resolve the anti-trust issues and maintain competitive balance at the same time? I think the pro leagues would be interested if you know a way.

Since the amateur athlete model no longer exists, the players are going to be able to profit off the use of their NIL through endorsement deals, social media, and the like. They should be allowed to do that.

And any system where the players can profit from endorsement deals is going to favor players at schools with larger fan bases and bigger markets. There is no way around that.

And that in turn will affect where players want to be. It doesn't shut out small schools in small markets, but it's a disadvantage.

All I said was it is very bad for MSU.

 

[onewoof]

Football pays the bills for the other sports. Spending a lot of money on a non-rev sport like baseball or women's basketball is just stupid.

Football silly money no longer makes sense

 

[Podgy]

Football pays the bills for the other sports. Spending a lot of money on a non-rev sport like baseball or women's basketball is just stupid.

how much more do we make winning 7 games vs. 5 games?

 

[L4Dawg]

how much more do we make winning 7 games vs. 5 games?

consistently, a lot

 

[OG Goat Holder]

consistently, a lot

Well we ain’t anywhere close to that without a niche coach like Leach who can do more with less

 

[TXDawg.sixpack]

Sounds like the “why in the world would somebody move from California to Mississippi?” rationale the NCAA used to punish Renardo Sydney.

Except Renardo Sydney punished himself FAR more than the NCAA ever did!