There's a revolution happening
in today's multibillion dollar college sports industry. Over 100 years ago the NCAA was
created to regulate and control college sports. Their core principle is
that college athletes should be classified
as unpaid amateurs, barring those who compete in it
from profiting off their fame. Fast forward to 2021
and college athletes are still not
getting paid to play. But for the first
time in history they can make money off their
name, image, and likeness. And they're us
ing social media
to build their personal brands and businesses off the courts
and outside of the lines. With some of
today's top athletes garnering million-dollar
endorsement deals, will the new rules
even the playing field or destroy college sports? And will the NCAA ever
pay athletes a share of its billions in revenue? In this film we'll talk
to some of today's top athletes, agents, schools,
lawmakers, and leaders in tech to take you through the
story of NIL, how it started, where it is now, a
nd where it
could be heading in the future. 'NIL' is an acronym for name... Name... Name...
Name, image... Name, image, likeness. College athletes are now
able to leverage their brands and who they are in
order to make money. That allows them to really
start building their brand away from the sport that they
play at a younger age. Today's student
athletes are earning, at the high level, seven figures
through endorsements and NIL monetisation. They can also go
after third parties who use their na
me,
image, and likeness without their permission. And intellectual property,
that's a term of art that most college students
may never have heard until NIL came about. Name, image, likeness,
or NIL for short, will go down, for me as a
sports industry professional as well as a fan, one of the
most significant things that's ever happened in the
history of college sports. Our first stop on
this journey was to Fort Lauderdale,
Florida, to speak with Darren Heitner,
legal adviser to some of today's
t
op-earning NIL athletes. He explained how the NCAA
came under increased pressure to change the rules on NIL, from
changes in state laws giving students the right to payment to
landmark Supreme Court rulings. Having a unanimous decision
in favour of Alston in 2021 against the NCAA is vitally
important for where we are today with name,
image, and likeness. It basically called
the NCAA a cartel, that it was in collusion in
order to prevent athletes from a certain type of benefit. That being
academi
c-related benefits. And Justice Kavanaugh
went a step further in his concurring opinion to
say that maybe all restrictions should be shot down. And ultimately, the
NCAA, on June 30, 2021, finally changed its
regulations on this subject, implemented what it's called
an interim NIL policy. And that's why, as of today,
you see college athletes around the country finally
enjoying these rights. So why would the NCAA
forbid its athletes from earning money
in the first place? For that answer, let's
sta
rt from the beginning. On November 6, 1869,
Rutgers and Princeton played what is known as the
first college football game ever. But by the early 1900s football
had gotten so dangerous that there were public outcries
to ban the sport completely. And players not even enrolled
in school often filled out the rosters. So in 1905, US President
Theodore Roosevelt called together colleges
from across the country in a last-ditch effort
to clean up the sport. And in 1910, this group
became known as the NC
AA. The newly established
NCAA's mission was to regulate the rules,
protect young athletes, and establish amateurism
as the foundation for all of college sports. But it wasn't until a quarter
of a century later, in 1936, the athletes were allowed to
receive academic scholarships to help offset the
cost of attendance. Athletic ability should
receive consideration in determining student
values and in the assignment of scholarships, loans,
and opportunities for remunerative work. Thus, with the Sou
theastern
Conference's forthright action, college football becomes
openly subsidised. The NCAA classifies itself
as a non-profit organisation. But it generates revenues
in excess of $14bn annually, a number that has more than
tripled over the last 20 years and rivals professional
sports around the world. But despite all the marketing
and TV deals, ticket sales, and merchandise sales,
college athletes still aren't paid a
share of the revenue. This has been a source of much
controversy over the ye
ars. In fact, over 80
years ago in 1936, MIT Professor George Owens
brought up this exact issue. If it is necessary for a boy to
undergo extreme risks of limb and, yes, life, why
not reimburse him in a substantial and
regular business manner? Why shouldn't the players share
in the profits of the game? Their reasoning for not
paying athletes directly? Amateurism. We need to safeguard the
non-employment status of student athletes to
maintain the core principles of collegiate athletics. The college
s don't want anything
to change because the, largely, white men who are making the
million dollar salaries, who are putting the
product on the field. That's a civil rights issue. That's an economic rights issue. And it needs to change. I'm not saying the coaches... I mean, the
administrators don't do a good job of doing their job. But we're the ones
out there playing. And so, yeah, I mean,
I don't feel like we should receive a lot of it. But some of it,
we should receive. There should be a point
where
the NCAA should compensate athletes at a certain level
for ticket sales, jersey sales, anything directly
related to the name on the back of the jersey or the team
because the fans come to watch the players. And the fans buy the jerseys
of their favourite players. Your name, your image,
and your likeness isn't as big as someone
else's, you're not the superstar on the team,
maybe it's harder for you to get deals. So within that, the NCAA could
possibly pay you with that. But I feel like it
would have to equal out to where everyone is
happy with the fees and it's not one being
paid more than the other. I think we should look at
the big-time college sports, in particular football
and basketball, just like we look at pro sports. There should be revenue sharing. A portion of money should
be kept by the owners, who, in this case, are the colleges. And then a portion of the
money should be guaranteed to go to the students. If student athletes
are classified as employees of their
univers
ity, their college or university, it is, as
Senator Schatz pointed out, it does change,
very fundamentally, the nature of that relationship. It moves student athletes
out from underneath the guise of education law, for
example, to employment law. It changes everything about
what college sports really is and why we have created college
sports 120-some years ago. The college sports industry
got away with this for so long because they convinced
people that these were student athletes. And the schol
arship was
their form of payment. That scholarship is worth
peanuts compared to the money that the coaches and
these assistant coaches and the athletic
directors are getting. According to ESPN
and the US Census, head coaches are among the
highest paid public employees in almost every
state in the country. Top football coaches, like
Nick Saban at Alabama, make upwards of $10m a year. Although college
athletes still are not paid a share of
the revenue, 2021 saw a major shift in the college
athleti
c financial ecosystem. To see just how some of today's
athletes are taking full advantage of the new NIL rules,
I travelled to the University of Tennessee to
document Grant Frerking, student athlete
and entrepreneur, for a day in the life. My name is Grant Frerking. I am the founder and CEO
of Metro Straw based out of Atlanta. I'm also the founder
of GTF enterprises and the president of
NILU at On3 Sports. I also double as a wide receiver
on the University of Tennessee football team, wearing num
ber 0. You know, my day
in the life looks different than even a lot of
my fellow student athletes that I share a field with. My mornings start very early. I usually get up around 5:30. We usually roll to the
football facility around 7:00 in the morning. Go through breakfast,
meetings, treatment. Get out on the practise
field, come back, and usually aren't leaving the
football facility until lunch is done, around noon or so. And then my
afternoons are usually filled with a meeting
with my On3 tea
m, so going and creating all
of our content strategy plans for the week. And then at night
catching up on emails, phone calls,
studying when I can, and getting to bed
at a decent hour before I go do it
again the next day. The new rules have allowed
grant to start his own NIL business, GTF Enterprises,
an independent NIL company in which he's helped his
own teammates secure NIL deals. It's a very busy schedule. And it's really hard
for myself to get a job or to do other activities
outside of my s
port. So that's where the NIL deal
situations have come in. It's been an opportunity
for me to focus more on myself and my brand. But on top of that, I'm getting
paid for posts on Instagram and Twitter as well. So my teammate explained
to me that the cookie deal was to where I would do a video
on Fridays before each game. I'm here to let you know
again that Moonshine Mountain cookies will be giving
away two free cookies if I get an interception tomorrow
at tomorrow's football game. The day of th
e game, when
he got that interception, they saw an 8,000 per cent
increase in Twitter growth. And they saw a 200 per
cent increase in revenue in the stores over
the previous Saturday, just with new traffic coming
in to get these cookies. And all the cookies were free. So people were coming
in there and buying all sorts of other products
while also taking advantage of these free cookies. That's, at its core,
what NIL is all about. You're helping the athlete. But you're also able
to change the liv
es of these local business
owners and making them feel part of being
something a lot bigger than themselves, which
is the University of Tennessee and watching Alontae
play on Saturdays. A number of colleges have
employed tech companies to help them and their
athletes navigate this new NIL territory. So I travelled to Louisville
University to talk with Blake Lawrence, the co-founder
and CEO of Opendorse. ...things out to your stories,
as well, which is great. But stories disappear
in 24 hours. We
've been fortunate to
partner with Louisville. And now more than 50
schools across the country are turning to Opendorse as
their NIL education solution. Athletes download Opendorse
and create a profile and list out the types of
endorsements or services they're willing to
do and get paid for. They receive an
alert to their phone any time an opportunity
comes their way. They can review the
deal, hit accept. And Opendorse does the rest. It reminds them of where to
be, what to say, what to do. We ha
ndle everything
from the contract to the completion of that
contract and even tax preparation. Today's athletes are
using social media to build audiences that are
enviable by celebrities. Their follower count
and their bank account are forever linked. According to Opendorse, the
vast majority of NIL revenue has come from posting
on social media apps. We asked Dev Sethi, head
of sports partnerships at Instagram, just
how big of a role does social media play
in the NIL ecosystem. There are a varie
ty of ways in
which student athletes can make money by leveraging a platform
like Instagram, whether it's in partnering with brands and
leveraging our branded content tools to really amplify their
content and grow their exposure and reach. We've seen a number of
college athletes that have invested in developing
their own merchandise lines and leveraging commerce
tools on Instagram, such as Instagram checkout. Really, the world
is their oyster in terms of how they're able
to bring their name, ima
ge, and likeness to life
on social media. Louisville star quarterback
Malik Cunningham, who has amassed over 20,000
followers on Instagram, was able to sign a lucrative
NIL deal on the very first day of eligibility. Social media plays a big
factor because that's where everybody is. Like, that's what
everybody does at work. That's where the media comes and
finds you, looks at your page. And a lot of those companies
look at your Instagram before offering you a deal to
see what type of guy you are.
And so social media
plays a big part in it. And you got to watch what
you post and what you say and how you treat
people on there. And yeah, it takes
you a long way. The larger their
online audience, the more opportunities they
will have for endorsement deals, autograph signings,
appearances, social media posts. They'll get paid more per post
the more followers they have. So an athlete with 10,000
followers on Instagram could earn anywhere from $200
to $1,000 for one social media post. There ar
e student athletes
across the country that are getting paid upwards of
$50,000 for one Instagram post. The highest earning
student athletes in the first 100 days of NIL
are women's basketball players, women's volleyball
players, women's gymnasts. These are individuals that have
built a large online audience, like Hanna and Haley Cavinder at
Fresno State or Hailey Van Lith right here at Louisville. Hailey Van Lith is one that
built her large audience because she's an
incredible athlete. And she's
attracted a lot of
followers because of that. Being a student athlete, time
is something of great value. And we don't have a lot of it. And there's no
time to have a job. And we get
cost-of-living paychecks. But really, honestly,
that covers about our food so we get to survive. And some of my teammates,
even at the end of the months, right before we get paid
again, they're struggling. We can't hold a job down. We commit ourselves
every day to this sport. And we signed up for it. And we love it.
And this is the sport
we want to play. But at the same time, we should
have the freedom and the money to live a nice life
and not be struggling. We have 6am weights. We have practise
for three hours. And season is a whole
different story. It's even more intense. I'm going all day. I get home at 9 o'clock. I do homework for two hours
and hopefully get a dinner in before 11:45. And I get back up in the
morning, and I do it again. So there's a lot of
mental and physical stress that I don't think p
eople really
understand unless you live it. And so I think the NIL
will definitely benefit us from a financial standpoint. My next stop took
me to Marina del Rey in Los Angeles,
California, to speak with Sabrina Ionescu,
former women's basketball star at Oregon and the number
one pick of the 2020 NBA draft. She's also the chief
athlete officer at Division Street,
Oregon's newest venture helping its athletes create and
monetise their personal brands. We talked about how today's
college athletes c
an best choose deals and partnerships
that maximise their earning potential. I think being able to earn money
from NIL for college athletes, it's so important
just because it teaches you a lot
about business, a lot about your brand
and what you stand for. And a lot of athletes now are
not only seen as athletes, but they're also influencers. If you want to build your
brand and partner with brands and having
partnerships and deals, I think it really has to be
true and authentic to you. And I think
that's when
it will be successful. Sometimes a lot
of these athletes might sign really
long-term deals and kind of sell
themselves short, because every year you're
supposed to get better. Every season you
want to get better. And if you sign into a
long-term deal and you skyrocket and end up playing really well
and exceed all expectations, you're really locked
into this deal that you signed
your freshman year. And so I definitely
think athletes should have representation
and have an agent. Peopl
e might not
tell you the truth and might not portray
who they really are. And I think it's
your job to really either have agents
that know the business and know who these
people are or really trusting in the right people
and asking the right questions to figure out what that is. To hear more about the
agent's role in NIL, we headed back to New
York City to speak with Colleen Garrity of
Excel Sports Management, one of the top grossing
sports agencies in the US. An agent's role in NIL is
really to
serve as an adviser and to guide the student
athletes through this process. We handle everything off
the court from sales pitches to contract negotiations
to compliance and making sure we're not
jeopardising their eligibility so they can really
focus on the two most important things
for them, which is their sport and their classes. I think it's also
important that... because agents have experience,
they know the space, they're familiar
with the brands, and they know how to put a
strategy togeth
er for a student athlete that's most authentic
to them and can really help them down the road develop a
brand that they're proud of. Excel recruits athletes
that are high character. We want good people. And so that's probably
number one for us. And then we look at the
marketing potential. So that could be followers,
engagement, unique interests or hobbies a student athlete
might have that sets them apart from everyone else. So there's a lot of things
that go into marketability, all factors which
we consider
when signing someone. It's important to have
an agent primarily, because this is such a
new space and the rules and the laws are always
changing, to make sure that someone's
providing good advice and ensuring
compliance, number one, so student athletes don't
lose their eligibility. So how do athletes stay in
compliance with all the rules? The NCAA, in its
minimalised restrictions, has said there are three
important things that must happen in all of these
deals, or must not happen. N
umber one, there must be
some deliverables provided by the athlete to the
third party in exchange for that compensation. Number two, money cannot be
based on future performance. Obviously, brands that
do deals with athletes are hoping that the
athletes do well. However, there can't be
bonuses or incentives in these contracts where an
athlete gets more money based on having x number of yards
or y number of touchdowns or winning the Heisman Trophy. And third, money
can't be conditioned on an athle
te
attending a university or staying at a university. Although the NCAA has released
basic compliance rules each of the 50 states in the US also
have their own separate NIL compliance rules. I definitely think the
compliance rule should be the same across the board. If we see some
regulation happen that I would be a proponent of,
it would be regulating the ability for schools
to pool money together, crowd source a lot of
money, and go and just try to buy athletes
left and right. So where are we
today with
federal NIL regulation? I asked the FT's Sara
Germano for the latest. What I've heard from
sources on the Hill is that there are quibbles over
what federal legislation might look like for college
athlete compensation. You have Democrats on the far
left saying NIL isn't enough. We need to do more than that. We need to have revenue sharing
between the universities and the athletes. There needs to be
more strict concussion protocols put in place,
health and safety type of measures, et ce
tera. Whereas on the far
right you're seeing people who want to provide
safety mechanisms for the NCAA to try to give them some form
of an antitrust exemption and shield them from
litigation that may come out. And that is actually
currently pending based on their prior abuses. Passing an NIL bill at
the congressional level is critical to moving
forward, in part because we want
to get this done. And we want to do
it and not be then immediately sued for having done
the right thing in this case. I
think the NCAA is
one giant walking, talking antitrust violation. They have colluded the
schools through the NCAA to set the wages
that every student athlete will make, right? Right now, a student
athlete is only going to get the scholarship
from the school, nothing more. That's the definition
of collusion. One of the reasons why
I think we should pursue federal legislation is
because this right, right now, could disappear any
time that the NCAA feels like their money is being
threatened by thes
e endorsement deals. The NCAA is at a point
right now to where its existence is on the line. I think most
fundamentally, Senator, converting student
athletes, or having them change into an
employee-employer relationship, fundamentally blows
up college sports. The notion of
collegiate athletics is that these are not employees. They're not hired professionals. They are, in fact, students
who are participating in sports voluntarily. It's all illegal. We would never allow this
in any other industry.
But for some reason,
we've allowed it in the college sports industry. It's time for that
to come to an end. I'm interested in federal
action if it empowers athletes. I'm not interested in
federal action if all it does is give the power
back to the NCAA, because there's nothing the
NCAA has done that convinces me that they are going
to act responsibly if they're given even more
power than they already have. If, Senator, the policy only
deals with direct name, image, and likeness and doesn't
incl
ude a revenue sharing model, then I think it can have a
very positive impact on women and Olympic sports because it
could provide them with greater opportunities to gain
access to media markets, to be involved in any of a
variety of NIL activities. If, conversely, it required
a revenue-sharing model that took resources away from
the dominant sports that produce revenue, it could
have, as a number of us have said earlier, can have a
very negative, even cataclysmic impact on Olympic sports. No les
s than seven
pieces of legislation have been drafted between
the end of 2019 and today. And yet not a single
one of those bills has even reached the
floor for debate. The problem is
this issue has now become so conflated
on Capitol Hill that it's actually rather
unlikely that anything gets done in the near future. The one thing that's
for certain is that the old rules of amateurism
seem to be done for good. Is there a possibility at some
point in the future that there will be unionisation? Yes,
I wouldn't count it out
of the equation absolutely. I think more likely
than a union perhaps would be some sort
of trade association, where athletes
around the country are able to do group licencing
agreements and ultimately group licencing deals, allowing
things like a college football video game to return with
athletes' names, images, and likenesses. So what happens now? Overarching federal regulation
for NIL may be some way off. But with more college players
making more and more money the old
rules of
amateurism are finished. And public opinion is shifting
in favour of athletes being paid to play, and not
just through NIL deals. The NCAA's reputation
may have taken a hit. But the game goes on.
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