As mentioned in our recent blog post, the National Collegiate Athletic Association (NCAA) had been steadfast in its opposition to California’s recently enacted Senate Bill 206, known nationally as the “Fair Pay to Play Act,” which aims to allow collegiate student athletes to benefit financially from the use of their name and likeness and enter into licensing contracts.

On Tuesday, however, in a stunning reversal of course, the NCAA released a statement that their board of governors "voted unanimously to permit students participating in athletics the opportunity to benefit from the use of their name, image, and likeness in a manner consistent with the collegiate model." This concession by the NCAA has opened the door for student athletes to earn millions of dollars through license and endorsement deals.

In easing their public opposition to the idea of allowing endorsement deals for college athletes, the NCAA has now provided direction to its three divisions as they begin the process of updating their bylaws to permit student athletes to earn income. Specifically, the NCAA listed the following “principles and guidelines” to be followed:

  • Assure student athletes are treated similarly to non-athlete students unless a compelling reason exists to differentiate
  • Maintain the priorities of education and the collegiate experience to provide opportunities for student athlete success
  • Ensure rules are transparent, focused, and enforceable and facilitate fair and balanced competition
  • Make clear the distinction between collegiate and professional opportunities
  • Make clear that compensation for athletics performance or participation is impermissible
  • Reaffirm that student athletes are students first and not employees of the university
  • Enhance principles of diversity, inclusion, and gender equity
  • Protect the recruiting environment and prohibit inducements to select, remain at, or transfer to a specific institution

There is still a level of uncertainty in how the NCAA intends to navigate this major change “in a manner consistent with the collegiate model” as is their stated goal. What is clear, however, is that the financial landscape in college sports is going to be forever changed as individual athletes are able to earn income from the multibillion-dollar college sports industry.