Front Burner - Law forces NCAA to let some athletes finally get paid

Episode Date: October 2, 2019

U.S. college sports generated at least $14 billion last year. And while coaches get paid multi-million dollar salaries, players aren't paid at all, beyond the cost of attending the university. Now, a new law in California will allow student athletes to profit from the use of their name, likeness and image — essentially, to get endorsements. The NCAA has said the law will "erase the critical distinction between college and professional athletics." But today on Front Burner, the Toronto Star's Morgan Campbell explains why he thinks these athletes are acting like professionals already, and should be compensated accordingly.

In the Dragon's Den, a simple pitch can lead to a life-changing connection. Watch new episodes of Dragon's Den free on CBC Gem. Brought to you in part by National Angel Capital Organization, empowering Canada's entrepreneurs through angel investment and industry connections. This is a CBC Podcast. Hello, I'm Jamie Poisson. So earlier this week, California Governor Gavin Newsom made a special appearance on NBA star LeBron James' show, The Shop. This is the number one reason why we've created this platform, to be able to have moments like this. Let's do it, man.

All right. Now we're all in California. That scribbling that you're hearing right there is the signing of Bill 206. It would let college athletes in California who were only paid through scholarships before profit from endorsement deals or get paid for going to events and signing autographs. Athletes have been fighting the NCAA over this for years. Profit from endorsement deals or get paid for going to events and signing autographs.

Athletes have been fighting the NCAA over this for years. Last year, the sports governing body netted a billion dollars in revenue. And while this law has only been passed in California, it could have implications across the United States. A lot of Canadians come up through this system too. Today, we'll talk about what this bill means and what questions still remain. Morgan Campbell is here with me. He's a sports writer for the Toronto Star. This is Frontburner. Morgan, thank you so much for being here. No problem, anytime. Can we start here? Can you paint me a picture of how big a deal college sports like basketball and football is in the US? A bigger deal than most Canadians can imagine only because in so many parts of the country,

like that is your team. They exist in a lot of places where there are not a lot of pro teams. So like if you live in Tallahassee, Florida, you're therefore not in Miami, you're a long way from Miami, you're a long way from Miami. You're a long way from New Orleans or wherever the closest NFL team is. So the Florida State Seminoles are your team. F-L-O-R-R-E-A-S-T-A-T-E. Perfect, perfect, perfect. Alabama, same thing.

You're going to cheer for Auburn. You're going to cheer for Alabama because you don't have the NFL. I know there's so much money also attached to this. And before we get into how much money, like, who is making money off of this and how? Who? Okay. That's a good question. It's a big player. Yeah. Television networks are making money, obviously, because they're paying big rights to the NCAA,

to the various conferences that fall under the NCAA's umbrella. And then monetizing that investment through broadcast, advertising, other sponsorships, whatever. CBS, Turner, and the NCAA tournament announced an eight-year extension of their multimedia rights for $8.8 billion. March Madness also hit $1.32 billion in TV ad spending in 2018. Compare that to other sports' postseason, March Madness beat out the NBA, MLB, and college football. season, March Madness beat out the NBA, MLB, and college football. Everyone is paying for a piece of, you know, this premium content, this premium broadcast content that is college football, men's college basketball, and to a growing extent, women's college basketball.

Coaches get paid. All these various sponsors, they find ways to monetize these sponsorships. Clearly, it's worth it to them to invest. We're talking about like Nike here. Yeah. Nike, Under Armour, Adidas, et cetera. Nick Saban, head football coach at the University of Alabama, he makes around $8 million a year, but he is also free to negotiate sponsorship deals that add to his salary. Right, right. Then Duke's coach gets like $9 million a year. Mike Krzyzewski, yeah, he's in that neighborhood, exactly. So it's fair to say like the people working at the NCAA

are making a lot of money. The broadcaster's making a lot of money. Absolutely. The sponsors, the coaches, the athletic staff. Think about it this way, right? Like how many offices, like the people that are listening to this podcast, middle of March comes around,

like how many of you guys are going to get involved in a March Madness pool, right? Right. And the NCAA's own numbers say they're bringing in 844 million from March Madness, Division I men's basketball championships. Yeah, that's an average per year of a multi-billion dollar multi-year contract. Billion with a B. Yes, absolutely. Wow. So like there's so much money here, right, that's being made off of this industry. And can you explain to me like why the athletes haven't been getting paid? What is the logic behind that? There's the argument that this is the way that things are, so it shouldn't change. Two is the argument that this makes them professionals.

makes them professionals um three there's the argument that if college players get paid that it somehow diminishes the value um of the enterprise okay this is an argument and you know ncaa officials have put forward that a lot of the appeal of college sports a lot of what makes it special it makes it popular to tv viewers to to ticket buyers, etc., is the fact that the players don't get paid. All right, let's welcome college football analyst Tim Tebow. It changes what's special about college football. We turn it into the NFL, where who has the most money, that's where you go. That's why people are more passionate about college sports than they are about NFL, because it's about your team, it's about your university, it's about where my family wanted to go,

it's about where my grandfather had a dream of seeing florida win an sec championship and you're taking that away so that young kids can earn a dollar now now what i don't know is if there's any actual evidence to back this up as opposed to just appeals to doing things the way they've always been done or appeals to sentiment because there's still like a lot of romance around the idea of an amateur, of someone who does it for love, someone who does invest 20 plus hours a week of their time in this enterprise and wants something besides money in return. There's a lot of romance around that.

The idea that you're doing it like for your school, for your team, for your community and not for the paycheck. Absolutely. But you know what these coaches are doing it for? They're doing it for the school, for your community and not for the paycheck. Absolutely. But you know what these coaches are doing it for? They're doing it for the paycheck, right? Which is the fundamental, one of the fundamental contradictions of this whole thing. The NCAA has sent a letter to the governor of California asking him not to sign a bill. The NCAA calls the Fair Pay to Play Act harmful and unconstitutional,

adding that it would, quote, upend the balance of national competition. Give me a sense of how far the NCAA and these universities have gone to enforce this rule, because I know this is a rule that people have been objecting to for a long time. The NCAA hit Ohio State with a one-year bowl ban, plus other penalties in the wake of a scandal that involved eight players taking a total of $14,000 in cash and tattoos in exchange for jerseys, rings, and other Buckeyes memorabilia. Then-coach Jim Trestle knew of the violations but failed to speak up. And I've heard there have been like FBI stings and stuff, right?

Yes. The FBI gets involved in monitoring and cracking down on illicit payments from alleged street agents who are taking, basically they're getting money from shoe companies and then giving money to recruits and families of recruits to steer them to schools that are sponsored by the same shoe company. My name is June Kim. I'm the acting United States Attorney for the Southern District of New York.

The picture painted by the charges is not a pretty one. Managers, advisors, and those affiliated with the sportswear company work together to funnel money to families of some of the country's top high school recruits, upwards of $100,000. And so we've gotten to the point where leagues, taxpayer dollars now are being spent on cracking down on a market that the NCAA calls illicit, but that the rest of us would just call thriving and natural. Right, right, right. Like supply and demand. I remember a little while ago, there was a player, Donald DeLaHaye. I think he plays for the Argos now. I'm ready to focus. I'm ready to be committed. I'm ready to give my 110% to this team. I'm ready to make some banger videos too. Former UCF kicker. And he was told he couldn't play unless he demonetized his YouTube channel because he was like putting up all of these like clips of him like kicking footballs on YouTube.

And he was making some money off of that. And they said, like, no, you can't do that. And in the end, they just told me I either agreed to the terms they gave me or, you know, I choose to rule myself ineligible. Basically, the bread and butter of my channel is football related stuff. They told me I couldn't even, you know, go to the beach and toss a football with my friends. I couldn't even talk about quarterbacks, nothing. I felt like it was extremely unfair, in my opinion. And I was going to mention Donald Delahaye. I'm glad you mentioned him because he and people like him are the biggest beneficiaries of this new law in California whenever it comes into effect. Because what the law says is that

players can now cut their own endorsement deals and monetize their image and their profile, which sounds great in theory. It's a very difficult thing to do in practice because what you're telling these players to do is basically get another job, like playing college football, college basketball. It's a full-time job. So you don't have time on top of that to go hustle up these sponsorships. The potential beneficiaries are the Donald Delahays of the world. Got it. Who kind of did his own thing and made money off his own image in like this very entrepreneurial way. Do you think this new California law goes far enough?

Because this is not about giving players a salary. It's about letting players profit off of their own image. So like the YouTube channel or, I don't know, I guess maybe they could even get a local deal with like a car dealership or something, right? We got the governor of California signing a bill. The folks that are putting their lives on the line, putting everything on the line, are getting nothing. You can only imagine how they're responding to this notion

of name, image, likeness, and the opportunity now to do what every other student in the university can legally do. The only people that sign away their right are athletes. It's progress, but it's not the thing that makes sense. So here, what you have is some leeway, some legal leeway for players to get paid. But again, it's still a compromise because no one wants to, for whatever reason, no one in compromise because no one wants to for whatever reason no one in a position of power wants to go the full step and say these players uh are the backbone of a multi-billion dollar industry they deserve money uh for the work that they perform and and

so because what this deal does is it says you deserve money if you're famous it doesn't say you deserve money because you work hard basically what it's saying is you can you deserve money if you're famous it doesn't say you deserve money because you work hard right basically what it's saying is you can you can take money if you are able to wrangle yourself some third-party deal if you if you are famous enough to score a third-party deal or at least engaging enough on youtube or whatever uh to get money that way, have at it. But yeah, like for the rank and file players who are also very important to this lucrative industry, they're still out of luck. In the Dragon's Den, a simple pitch can lead to a life-changing connection. Watch new episodes of Dragon's Den free on CBC Gem. Brought to you in part by National Angel Capital Organization, empowering Canada's entrepreneurs through angel investment and industry connections.

I imagine some people might be listening right now and thinking to themselves, well, you know, these players do get scholarships, right? And I think, you know, they often get stipends. And isn't that good enough? Like, doesn't that help the financial position that they're in? Isn't that good? Yes and no. Scholarships are currency in the context of a university. Yes.

But if scholarships were real currency, everyone would be getting paid in scholarships. You'd be brokering these sponsorship deals, paying each other scholarships. Hey, Nike, how many scholarships do you want in return for all these shoes? But that's not how they do it, right? Like the only group of people who are expected to get paid in something other than cash in this whole enterprise are the players. And the players are the ones that people pay to see. And Mike Krzyzewski without good players would not be a $9 million a year coach. Nick Saban without good players would not be an $8 million a year coach.

So the argument for paying players is really simple. It's the fact that the players underpin, support, and drive this multi-billion dollar industry. Because as much as these college coaches are celebrities, we still don't pay to watch the coaches coach. We pay and tune in to watch the players play. So no one ever says these coaches make too much money. No one ever says cap coaches salary because this is an extracurricular activity. It's only an issue when it comes to the players. I know there have been stories from some players who have talked about how difficult it's been for them to make ends meet, even with a scholarship.

You know, they don't all come from wealthy backgrounds. Like Shabazz Napier talked about how he went to bed hungry some nights, how he couldn't afford food. Well, I'm not able to eat, but I still got to play up to my, you know, capabilities. And sometimes it's that way. I don't think you, you know, student athletes should get hundreds of thousand dollars, you know, but something can change, something should change. Absolutely. And the thing is like, the poverty argument is compelling, but it also has nothing to do with it. Like everyone needs money.

You're trying to make an argument here that this is the right thing to do. Yes. So the reason to pay people isn't because they would starve if you didn't pay them. That's a reason to pay them. But the reason to pay them is because they deserve to be paid. It's because they put in the work. Right. You're saying these athletes help fuel this $14 billion industry,

and so they deserve to be compensated. Yes. That's what I'm – yes. And if the choice is pay the players or let them starve, well, then we're already in a bad place. But again, like, is this person starving is not the standard for whether or not you pay them. Are there any other options for these players, like,

to play outside the NCAA system? Like, do they have to go through this system in order to be a professional athlete? No, it all depends on the sport you play. And this is the thing, like the line between amateurism and professionalism is most ardently enforced only in the sports where one, pro teams don't want to pay to develop players, and two, where there's a lot of money to be made at the college level for other people. Because if I'm a baseball player, I can enter the draft at 18. And if I don't like where I'm drafted, I can go to college. No one's going to tell me you're ineligible to go to college to play college ball because you talk to the Blue Jays. Football players don't really have that option. You have to be three

years out of high school before you can play in the NFL. So if I'm an 18-year-old football player who's not really interested in school, there's no professional option for me. Basketball players have more options, right? They can go to the NBA G League. They can play overseas. You shouldn't have to choose between education and getting money because like in any other pursuit, no one's stopping a music student from going out and taking gigs while they're playing in the marching band. So sports should not be any different. And again, the only reason it isn't different is because it hasn't been different. Joining me now is Draymond Green, forward for the Golden State Warriors.

That's a dictatorship. I'm going to tell you exactly what I want you to do. I'm going to take all of the profit. And if you do this, then you have to deal with the consequences. The difference in a dictatorship is that as a resident of one of those countries, you don't necessarily choose to live there. You're born into it. Students choose to go to these colleges, correct? Yes, but what's the alternative? You know, there's only so many athletes who can go straight to the pros, even if the rule wasn't in place. I'm interested to hear your perspective on how you think this law could potentially change college sports, like change the NCAA, right? Like, even if you think it's just a first step. So the NCAA says that this law will give schools an unfair recruiting advantage

and would result in them eventually being unable to compete in NCAA competitions. Like, what do you make of that? Recruiting advantages already exist, right? When you watch, especially college, like big time college football, you see the same teams kind of rise to the top every year. Well, in football, it's Alabama, it's Clemson, it's Georgia, and then a few others, Notre Dame some years. But those are schools that also have a lot more money and they have more money to spend on recruiting. They have more money to spend just like on perks. I think though, what you might see, especially in states where like people really care about college sports and where like the state's identity and the local pride is really tied to

the local college's ability to compete in college sports is where you might see other states picking this up. I think- Right, right. New York is saying they're considering it. Absolutely. New York, especially because the Division I schools in the state of New York, they already have a tough time competing for recruits, an opportunity to make money outside of school, especially if I go to Buffalo, because there aren't a lot of big stars in Buffalo, right? So all of a sudden, University of Buffalo can make itself a player in terms of competing for recruits that otherwise might not have considered them.

Right, right. Because it's like a perk for the athletes to be able to like make some money, possibly if they go to that state. Is there a scenario in your opinion where this could hurt college sports? Listen, college sports are healthy and they're going to be as healthy as they feel like being. College football, men's college basketball like at the upper levels of division one um and again more and more women's college basketball like have kind of the people at the top have benefited from this false economy like because all the costs are hidden and the nba and the nfl have benefited from this false economy because the cost of player development are hidden.

You download them to colleges and then colleges say, well, we're going to pay these kids in scholarships. And the thing is, like college sports as they exist right now in the United States don't have to exist this way. They just happen to. Morgan, this was such an interesting conversation. Thank you so much. Anytime. Before we let you go today, just a note from the campaign trail. Conservative leader Andrew Scheer announced yesterday morning that he would slash foreign aid by 25 percent,

a measure he said would provide $1.5 billion in savings. The NDP announced they would allow parents to condense their employment insurance over a shorter parental leave. Leader Jagmeet Singh said this would give breathing room to parents who couldn't afford to live on 33% of a salary for a full 18-month leave. That's all for today, though. I'm Jamie Poisson. Thanks so much for listening to FrontBurner and see you tomorrow. For more CBC Podcasts, go to cbc.ca slash podcasts.