With NCAA, ‘it’s just a matter of when student-athletes will be classified as employees’

Those who believe that beleaguered NCAA president Mark Emmert stepping down next year will be the magic elixir to cure all of the ills of college athletics couldn’t be more off-base.

The problems are inherent in a model that includes more than 1,100 member schools operating with different missions – sometimes vastly different missions – under one proverbial big tent. And as schools and leagues become more disparate, the system becomes increasingly untenable. 

This is part 2 of a Q&A On3 had with Tom McMillen, the former U.S. Congressman, college basketball All-American at Maryland and Rhodes Scholar. He now is CEO of LEAD1 Association, which advocates on policy issues facing the 131 FBS athletic departments; creates working groups on issues such as NIL, transfers, diversity, equity and inclusion and enforcement; and provides feedback to the NCAA on best practices for representative governance. It also seeks to generate consensus opinion among FBS athletic directors on significant issues. 

Two of the important takeaways from a wide-ranging discussion with McMillen:

+ Once the winds of considerable change slow, expect a much different, diminished NCAA. McMillen: “The NCAA is going to be a shell of itself when this is all done.”

+ Conferences are preparing to assume more power in creating their own rules. But at the same time, only 34 percent of FBS athletic directors surveyed by LEAD1 agree or strongly agree with conferences having full autonomy to create their own rules. There is a major disconnect between how things are changing and how ADs want things to change.

Part 1 of the Q&A was posted Wednesday.

The interview has been lightly edited for clarity and context.

Q: A diminished role for the NCAA looks inevitable. What will that role likely entail?

McMILLEN: I think they will have an enforcement role because I think that is a hot potato that no one really wants. I think they will run the championship for basketball and the other championships. But, again, the business rulemaking will be relegated to the conferences, and that’s going to be very interesting. To me, it’s like having competitors making the rules of engagement; it’s just fascinating. Because each competitor is going to want to win, they are going to want to do whatever they can to win.

I’m sort of watching and waiting on that one because I think that is going to be a very, very difficult environment. I mean, if I’m the ACC and competing against the Big Ten, am I going to disarm? Or am I going to do whatever I can to be ahead of the game? So where does that come down? Alston, for example, you could have unlimited educational expenses. You could go hog wild on educational expenses for college athletes. You can have a collective bargaining model. In other words, it is as big as your imagination.

My gut says you’ll see two things. One, you’re going to see sports cut. And there’s a lot of constituencies, there’s a lot of votes in those sports. I look at things by votes. The swimmers, softball, there’s a lot of votes out there in those sports, and they are going to be cut on the altar of commercialism. And I think the stratification is going to be exacerbated. The money, the resources are going to be even more [advantageous] toward high-resource schools. And that’s only step one.

Step two is going to be the employment model. It’s even going to be worse. I think it’s very tenuous. And whoever takes over the NCAA is taking over a different organization than it was 10 years ago. Twenty years ago, before the conferences had these really huge media deals, it was a lot more powerful organization.

Q: How much relevant chatter are you hearing about a potential Power 5 breakaway from the NCAA?

McMILLEN: I don’t hear a lot about it. We asked that question: Should the FBS be smaller? Only 23 percent of our ADs agreed or strongly agreed on that. Forty-four percent said there should be a fourth division. But, quite frankly, there could be many divisions. There could be eight divisions. The majority of our ADs felt that Division I should be smaller. They felt that Division I was too big [358 schools play Division I basketball], but most of them felt comfortable with the FBS [131 schools].

The Power 5 breakaway is a very interesting issue. … What are the terms of the breakaway? Is it just the high-resource schools that break away? The consequences of that are is it they are mirror images of the NBA and NFL? What’s the point of the breakaway? Alignment like this is very relational to conference TV contracts. We are still in a very strong market for TV. But – and this is what [Notre Dame AD] Jack Swarbrick’s point was – as we head into the next decade and you have more and more cord-cutting … with the Big Ten, the expansion with Maryland and Rutgers was based on eyeballs. The Big Ten could be on all those basic cable packages and get paid “X” amount of dollars a year for eyeballs whether they watched it or not. That world is still going to be good as we go into the next round. But next decade, that is going to be a different world.

Comcast is not going to put you on basic anymore and you’re going to go into, “I only want to pay for what I watch.” That means a lot of the Ohio States and Michigans will say, “Wait a minute. People want to watch our games and we are the ones driving the eyeballs here. Maryland and those schools, when they play, no one watches them play on TV. Why are we sharing conference revenue the same way?” And that’s to the tune of $100 million. Ohio State will say, “Yeah, we earned our $100 million. Did those guys over there earn it?”

It is a different world when you don’t have the obligatory cable fee that was part of the past. So now it’s going to be based on streaming and what you watch on linear. You could have schools that say, “Look, this is not fair. We want our own league because we are the ones driving these revenues.” You could even have break-ups within conferences, that’s my point. So, yes, I think money will drive some kind of realignment down the road. And it will be ultimately, fundamentally driven by television and the changes in television. 

Q: Not enough people talk about that. There’s only a handful of schools that drive the revenue when it comes to attracting eyeballs. Wake Forest may be in the same conference as Clemson, but they are different. Same with Purdue and Ohio State. I’m waiting for the blue bloods to say, “I want to be in the same league as like-minded programs.”

McMILLEN: When [then-Big Ten commissioner Jim] Delany built that, he built that based on eyeballs, but now when you go to a streaming world and you go to a linear world where you’re no longer on basic cable, it’s all who’s watching the games. People watch Ohio State, they watch Michigan, they watch Notre Dame. It’s a different world. You’ll have those kinds of changes as well as the stratification, some conferences getting $100 million and others getting a couple million. So you’ve got changes within conferences and changes amongst conferences, there’s no question about it. 

Q: Overall, where are we headed?

McMILLEN: First of all, I think the transformation committee is going to do their work. And I don’t think this is imminent by any means. I think we have to figure out kind of where all this stuff sorts out first, which makes sense. The second thing is it’s just a matter of when student-athletes will be classified as employees. You’ve got state legislatures, you’ve got courts, and you’ve got the National Labor Relations Board. It is going to happen. And that fundamentally has so many consequences for college sports.

I’m not sure college sports, with its fragmented nature, is going to be able to come up with a model that can preempt a lot of this. And that model might be allowing football and basketball players and Title IX as well more resources, but not making them employees. In other words, it would be sort of an Uber licensing arrangement where, what I’ve often thought about is where a kid signs a contract then comes to school, they give the school the licensing. So all this comes back into the school, all these [NIL] collectives get thrown out. It comes back into the school. And the school now is managing this and selling group licensing and so forth. Maybe the kids get some part of the television revenue for that, provided they don’t transfer and sort of invest into it. And you can have academic vesting, too; you can have time vesting, and academic vesting.

And then Title IX, whatever money you give the men you’ve got to proportionately give to the women, which is OK. That may be the model that you move forward with. It is sort of what I call Uber licensing, but not an employment model. And they sign up. But there’s a two-way street. It’s not like you can just walk out the door. … College coaches [under contract] are able to walk out the door and go coach another team. That is kind of mind-boggling to me. You need to have changes on the coaches’ side. But you also need to have changes on the athlete side where there’s some bonding to the school, there’s a commitment. Right now, this is unfettered free agency.

I think there has got to be a tie-in to give them more of the pie, but it has got to be a two-way street. … The problem is how do you get there with all the fragmentation. Will that experimentation be done at the conference level? Probably so. It won’t be the NCAA.