How have NIL deals impacted collegiate sports so far, and can high school athletes benefit?
WASHINGTON – School is starting. That means new textbooks, new clothing — and maybe a few new name, image, and likeness offerings for college and high school athletes looking to make some money.
Whether it’s social media posts, in-person appearances, sports camps (or even fishing tournaments), the opportunity for athletes to make money is still relatively new. Here’s what you need to know as the athlete compensation era enters its second full sports season.
WHAT IMPACT WAS ON UNIVERSITY SPORT?
According to coaches, NIL deals have either helped bring them the players they were looking for or it’s just another level of competition to land the best athletes. Remember May’s sparring between Nick Saban, coach of perennial national title contender Alabama, and rival Jimbo Fisher at Texas A&M – with Saban’s flinging into criticism of HBCU standout Jackson State and its famed coach Deion Sanders.
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Many athletes have become entrepreneurs and some have agents. NIL has also allowed athletes to enter the transfer portal to not only look for another team, but also a better chance at more money from companies, brands or through the many collectives that have existed since the start of the NIL era in the July 2021 arise everywhere.
WHY DID IT TAKE SO LONG?
NIL’s heyday began with a seed: a 2009 class-action lawsuit filed by former UCLA basketball player Ed O’Bannon, arguing that the NCAA should not be allowed to use the likeness of football and men -Use basketball players – past and present – to make money. O’Bannon won on the antitrust component.
In June 2021, the U.S. Supreme Court ruled that schools cannot limit educational benefits for athletes, effectively repealing NCAA rules that barred students from receiving paid or financial aid beyond full scholarships.
In 2019, pending the ruling, California led the U.S. in passing a NIL law that forced the NCAA to clear the way on July 1, 2021 so athletes could earn advertising money, and prompted a stampede from other states.
WHAT ARE NILE DEALS?
Social media posts are the top activity athletes get paid for, followed by licensing rights, autographs/appearances, and running camps or lessons. The money comes from brands, fans and donors. Many states do not allow athletes to endorse liquor, tobacco, or sports betting.
WHO Governs Nile Deals?
This is a state-to-state situation and while the laws are largely the same, there are differences.
Many states allow third parties to connect companies with athletes for NIL deals.
In Georgia, schools can ask athletes to pool up to 75% of their NIL money to share with other athletes, but this is not a requirement. In Connecticut, athletes can use their school’s logo if the school agrees. And NIL contracts that Louisiana athletes report to their universities are considered confidential.
Some states, including Indiana, Kansas, Minnesota, New Hampshire, North Dakota, and South Dakota, do not have NIL laws for collegiate athletes. In these cases, collegiate athletes must adhere to the NCAA’s guidelines and interim guidelines. The NCAA says schools cannot “pay-for-play” nor violate recruiting laws, meaning athletes cannot receive ZERO money to play for a school or for their athletic achievements.
The NCAA does not monitor NIL business compliance or compliance with state laws. That’s up to either the school or the athlete, depending on the rules in that state. But the NCAA recently asked that member schools help with investigations into possible violations.
WHY IS THERE NO NATIONAL ZERO LAW?
It’s not a lack of effort. The NCAA and a few heads of the Power Five conference have asked for federal legislation. Two members of the US Senate – Republican Tommy Tuberville, former Auburn coach, and Democrat Joe Manchin – are drafting a bill and want to hear from the SEC commissioner and others how NIL laws can be changed. But there was no real movement in Washington.
Some states have “right of publicity” laws that allow an individual to choose whether their name or likeness can be used for commercial purposes. There is no such federal law.
The NCAA itself could establish a national NIL policy for its three divisions, although the organization is pushing for federal legislation instead.
WHO BENEFITS FROM NILE?
Male athletes are leaders in NIL activity, according to NIL platform Opendorse – 62.7% versus 37.3% for women. Soccer players and male basketball players received the highest percentage of completions when looking at the entire collegiate sports list (from data reported by Opendorse and other NIL platforms INFLCR and Athliance).
Some women’s sports follow these two, notably basketball, volleyball, softball, and gymnastics.
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The money is mostly focused on Division I athletics, although DII, DIII, and NAIA players could get deals.
The more niche the sport, the less likely it is to land blockbuster deals. Think tennis, field hockey, ice hockey and rowing. But there are exceptions, with water skis and rifles fetching average offers of around $1,400 and $6,000, respectively.
CAN HIGH SCHOOL ATHLETES JOIN THE GOLD RUSH?
Depends on where you live. More than a dozen states are okay with high schoolers getting ZERO deals, and others have considered it.
WHAT’S NEXT FOR NILE?
More money and maybe more regulation.
Opendorse forecasts $1.14 billion in NIL deals in 2022-23, with Power Five conference schools accounting for the largest share and by region of the South East. Collectives will play a large role in the growth of NIL as they seek to organize and raise funds for school specific athletes. Look for states without NIL laws to add laws – and states with laws to keep tinkering.
The NCAA is also facing another lawsuit, currently pending in the 3rd US Circuit Court of Appeals, arguing that athletes should be recognized as employees of their schools.
https://www.king5.com/article/news/nation-world/name-image-and-licensing/507-943c7bf6-486b-4914-96f0-688235f8f18a NIL deals: What to know about name, image and licensing in sports