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Adidas Trial Testimony: NC State Assistant Arranged For $40K Payment To Dennis Smith’s Family

The trial is exposing some unusual developments in college basketball, not least of these being cutting head coaches out of the financial loop

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North Carolina State v Duke
Is it possible that Mark Gottfried had no idea that Dennis Smith’s family got major money for his services? That’s looking more plausible.
Photo by Grant Halverson/Getty Images

We’ve been kind of fascinated by the Adidas trial because it’s exposed the market for college basketball talent and upset a bit of conventional wisdom about college coaching - that the head coaches always know what’s going on in their programs.

This change was (apparently) achieved when Adidas bypassed the head coaches and went through the assistants to pay players to attend particular schools.

On Thursday, former Adidas consultant Thomas Gassnola testified that he arranged for $40,000 to be delivered to the family of former NC State star Dennis Smith and that the money was delivered to former State assistant coach Orlando Early, at his house, so that no one else at State would find out.

As a number of people have pointed out, the idea that the universities were somehow defrauded is kind of nebulous. They weren’t hurt exactly, at least not when the players were there - they were actually helped - although they may pay a price later.

What fascinates us is that the head coaches were just cut out of the loop and evidently had no awareness of the large amounts of money involved.

In Brian Bowen’s case, the former Louisville commit said that he had no idea that his father had taken money. That seemed implausible at the time but less so now, just as Rick Pitino’s protestations now seem much more plausible.

These guys - and by that we mean at least various assistant coaches around the nation, Adidas’s Gassnola and James Gatto, AAU coach Merl Code and runner Brian Dawkins and apparently agent Andy Miller - seem to have set up a parallel network via Adidas schools that brought capitalism, albeit black market capitalism due to NCAA rules, to NCAA basketball.

It’s not like you have to feel pity for the NCAA. The NCAA has many obvious faults and has a particular genius for really screwing up when it comes to PR.

On one level though, it might be okay to feel sorry for them, at least a bit.

Former Duke big man Matt Christensen’s father Clayton, a professor at Harvard, came up with his famous theory of disruption to describe how technological advancements could allow young companies to topple long dominant businesses in a very short period of time. For instance Netflix started because founder Reed Hastings was irritated by Blockbuster’s late fees.

Blockbuster is now down to one store, last we heard, and Netflix is the single biggest user of bandwidth on the planet (and no late fees).

It’s not an exact analogy, but when serious money comes into college basketball and influences where talented players go, what else can you call it but disruption?

You can't duplicate colleges and universities and their passionate fan bases, and it’s really hard to relocate them, so Adidas has some real limitations here, but pretty clearly you can influence the flow of the main commodity - talent - and that affects not only careers of athletes and coaches but potentially the entire model the NCAA has protected so zealously.

The truth is that it’s almost impossible to know just how much of this is going on, who else is doing it and where the money is going.

When this is over and everything is public, the NCAA is going to have to face up to what’s been hidden so far, and that’s this: there is vast money flowing through the sport and like any other market, trying to suppress it just makes it more lucrative.

The only way to come to terms with it is to accept it, normalize it and build a structure to deal with it.

If that doesn’t happen something will replace college basketball and like Netflix ate Blockbuster alive, it may be sooner than we think.

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