There’s nothing new about college athletes selling sneakers for extra cash

Near the bottom of the athletic food chain, where scholarship athletes in high-profile sports dwell, there’s really nothing new about players selling their sneakers to get a little extra cash. N.C. State fans surely recall this fact of life from the Jim Valvano era.

When Valvano roamed the sidelines in Raleigh nearly 30 years ago, schools didn’t distribute $2,500 athletic shoes, as Nike did recently at North Carolina with its Air Jordan 3 Retro model. But market forces remain largely unchanged within the closed system maintained by schools’ united refusal to directly pay players for their services. Instead athletes in football and basketball receive enviable goods, privileges and expense money within the byzantine boundaries of NCAA rules.

Perhaps exploring those limits is what billionaire Michael Jordan had in mind when, in announcing provision of his signature brand for North Carolina players in March 2017, he (in)famously declared: “The ceiling is the roof.”

Probably not, but then who could tell?

Free sneakers are an accepted part of the swag in big-time college sports. Less acceptable, but unsurprisingly, a few athletes see opportunity in this windfall, daring punitive consequences to employ their entrepreneurial skills. That heedless capitalist spirit cost N.C. State an NCAA probation as the 1990s dawned, and caused 13 Tar Heel football players to be suspended for up to four games early in this upcoming season. Michigan, among others, is reportedly investigating similar shoe sales by its athletes in violation of NCAA rules.

Dean Smith, another Tar Heel basketball demigod, was masterful at principled navigation along the border of permissible, placatory largesse. When competition caused his squads to lodge overnight, he made sure they stayed in fine hotels. His teams similarly dined at top restaurants when feasible. If playing before the Christmas break, Smith preferred going on the road so UNC could legitimately pay travel expenses for players to loop back home before returning to Chapel Hill.

Smith was at the helm when Nike was building its brand by injecting funds and products into sponsored athletic programs, using teams and coaches as paid ambassadors. For years the shoe manufacturer reportedly had a hand in quietly steering select players to favored schools. Recently it’s alleged Adidas attempted more overt placements, using bribes to guide prospects to preferred programs, agents and financial advisers.

Those charges, announced last September, reflect an ongoing U.S. Justice Department investigation of corruption in men’s basketball that’s already sparked an NCAA rush to reform.

The money entering college sports from apparel companies is astronomical – and climbing. During the five academic years from 2012-13 through 2017-18, annual payments to Power Five schools in dollars and goods rose from around $100 million to $200 million. Nike’s investment alone more than doubled too.

Only public universities report these earnings. (Private institutions, including seven in the ACC, hide behind a dubious veil of secrecy to sidestep disclosure.) According to UNC’s Center for Research in Intercollegiate Athletics, the average Power Five school that reports funding from athletic apparel purveyors gets about $4.5 million annually. (The average for the ACC’s eight public universities is $3.72 million, lowest among power conferences.)

Other figures compiled by the N&O earlier this year put the ACC average at $4.78 million, counting private schools and recently extended contracts.

However you add the numbers, enough money is involved to turn heads and command plenty of leverage.

Nike easily outspends Adidas and Under Armour, its closest competitors. Yet, even as it ups its sponsorship investments, the industry giant is losing ground. That includes the Air Jordan brand. According to news website Quartz last September: “In 2016, for the first time in more than a decade, Nike didn’t have the top-selling sneaker in the U.S.” Adidas now outsells Air Jordan, and Nike’s American market share dropped 16 percent since 2014.

The availability of apparel money as companies compete for markets, augmented by burgeoning broadcast revenues, has heated up the so-called athletic arms race at the top of the food chain – a distorting danger now rarely lamented aloud by college leaders. The gush of funds is reflected in the breathtaking rise of gaudy new campus athletic facilities and of lucrative contracts for coaches, ADs and top assistant coaches.

Players can’t miss the dichotomy between lavish spending on other priorities and the share of the pie they receive. In his 1991 autobiography “Valvano: They Gave Me A Lifetime Contract, And Then They Declared Me Dead”, the former Wolfpack coach recounted a conversation with a player that helped convince him of the inequity in the NCAA system of sharing benefits with athletes.

“Every player knows how much money is coming into a university, and how much the coaches are making; it’s not hard to see why some players would resent it,” Valvano wrote. He concluded schools must pay a stipend to every scholarship athlete based on need, regardless of sport. “What’s fair is fair,” he asserted.

By then Valvano had been forced out at N.C. State, which incurred a 1989-90 ban on postseason participation and a two-year NCAA probation for longstanding failure to police the sale of game tickets and athletic shoes by basketball players. The school also self-imposed limits on basketball grants-in-aid, off-campus recruiting and official visits by prospects.

The violations and punishments seemed mild weighed against never-proven allegations that ranged from improper admissions to misappropriation of funds, grade changing to point shaving. The turmoil unfortunately sent Wolfpack basketball into a spiral from which it’s never fully recovered, and stoked a sense of unfair treatment among some State fans that lingers to this day.

Not to mention, subsequent athletes clearly weren’t deterred from selling sneakers, either.

This story was originally published August 21, 2018 at 5:14 PM.