A new age of college sports
Updated: May 2, 2022
By Max Linn
A debate that has lasted for years now. Should college athletes get paid off of their name, image, and likeness (NIL)? Over the past several years states have been figuring out ways to help these student athletes profit. They have been formulating different laws that would allow these athletes to receive endorsement deals. Recently, these laws went into effect.
July 1, 2021, was a monumental day in college sports history.
That was the day college athletes won their right to be able to profit off of their name, image, and likeness (NIL) as a student athlete and not just after joining the pro ranks.
Prior to the law going into effect, college athletes were not allowed to make any money from endorsement deals; they could only be rewarded with a full or partial scholarship that could include a monthly stipend for room and board. .
How did we get here?
The rationale behind NIL has been an ongoing argument within the U.S. government. In 2019 California passed a law that allowed college athletes to profit off of their endorsements, beginning in 2023.
A year later in June 2020, Florida made the same decision, except its start date was July 1, 2021. As months went by, other states started to pass similar laws – all with some restrictions involved.
Members of the NCAA board met several times to discuss athletes getting paid. Considering the laws that states around the country were starting to pass, the board held several meetings over the course of 2020 and early 2021 to brainstorm a way to create a national law for student-athletes.
The NCAA's board of directors adopted a short term rule change allowing college athletes to benefit from their name, image, and likeness. On July 1st the first states' NIL laws went into place. As months passed almost every state has issued a law allowing college players to benefit from their names.
Players in the past have taken money from companies and have suffered the consequences, such as losing their scholarship and/or also losing team scholarships. These situations are one of the main reasons that have ignited the debate for college athletes to get paid.
In 2005 University of Southern California running back Reggie Bush won the Heisman trophy. Later that year he was forced to forfeit the trophy when officials learned Bush had been receiving cash, travel expenses, and a house.
Bush’s situation sparked the first conversations about college athletes being able to profit off of themselves.
When the new NIL laws were passed, Bush said that he had reached back out to the NCAA and heisman trust to try and get his trophy back, but was unsuccessful.
In 2013 Texas A&M Quarterback Johnny Manziel was suspended for the first half of the season due to taking money for autographs. Manziel won the Heisman in 2012 but wasn't relinquished of his heisman.
There are still so many question marks with NIL. Everyone is experiencing the changes first hand because it isn’t even a year old yet.
Changes to recruitment
NIL has been around for about 8 months and it’s clear the differences it has provided in college sports.
Prior to July 1, 2021, if any college athletes accepted any money from endorsements they would be severely punished with fines or possibly even suspensions as with Reggie Bush and Johnny Manziel.
Besides college athletes being able to profit off of their names, there have been some big differences with the law being passed.
Perhaps one of the biggest impacts on college athletics with the NIL provision is the way it can affect recruitment for certain schools.
NFL and NIL agent Jumaane Ford pointed out that some athletes know they can make more money by playing at certain schools over others and that influences their choice heavily.
“Some of these athletes know they can make a lot of money going to a school like Alabama even if they get no playing time for a few years,” Ford said. “I think eventually there will be some rule changes.”
For instance if a player is talking to both Alabama and a school like Toledo, which school do you think a player would make more money?
When you go to play for a big sports school you are eligible for huge benefits.
The new era of NIL deals has also caused some chaos in the transfer portal.
In most professional sports you have what's called free agency. When a player's contract ends they have the right to choose their next team. In college you don’t have that, but what you can do is transfer schools.
Now with NIL players are transferring to schools where they believe they will be able to make the most money.
“It's not a bad thing that (players) can use their name, image and likeness (to make money)," Saban told The Tennessean. . "I think when we start using name, image and likeness to get a player to come to our school, then that's where I kind of draw the line. … It shouldn't be because this school is going to give me this much and that school is going to give me that much.”
Saban is one of the big beneficiaries from NIL considering Alabama’s national prominence. Yet he still has some negative thoughts about it.
Role of the agent
Another big change occurs on the agent side.
In college sports (football and basketball in particular), athletes are not allowed to sign with an agent until they have played their final college game.
Once NIL passed, players could sign with an agent for marketing rights, but not pro sports representation. However, many of these student athletes are likely continue with their NIL agents into their professional careers.
Former Texas A&M tight end Jalen Wydermyer talked about hiring an agent for his NIL representation
“I hired an agent for a reason. He does all my branding for the most part. School and football I have been balancing for years now.”
Hiring an agent allows these athletes to focus on their sport and school simultaneously.
But it remains a loophole for agents to sign clients earlier than they normally would.
How an NIL deal comes together
What goes into signing an NIL deal and how do athletes negotiate it? It’s been a process for both athletes and agents to figure out. Part of this process is learning to understand not just the market but their market. ?
“It is really new to everyone,” said agent Jumaane Ford. “Depending on the player, you really have to market to their college town instead of nationally.”
What this means is if you go to a smaller school, you aren’t contacting brands such as Bojangles or Nike. You look toward the local restaurants, retailers, etc to try and create a deal.
It isn’t impossible for small school athletes to connect with a big named brand, but it isn’t as common.
You have guys such as Alabama’s Bryce Young who has made over $1 million since NIL was first introduced. Then you have smaller school athletes who are just getting free merchandise from companies like PSD Underwear, Barstool sports, and Rhoback instead of actual money.
When the NIL laws first passed, one of the big things that professionals in sports marketing would say is to hire an agent or a lawyer to look over every marketing contract they had with a company. These individuals are trained specifically to look over contracts and make sure companies don’t try and take advantage of student athletes.
Companies are constantly emailing student athletes to set up ways to promote their businesses.
Once a player commits to endorsing a company, then he must figure out the terms of the deal - whether that's a certain amount of social media posts or an appearance at the company's headquarters.
Once all the terms are squared away then the player must report the contract terms to the school. .
“You have to log each NIL deal with the athletic department,” said Wydermyer.
In terms of what kind of companies these players are working with, it really can depend on where they go to school.
“Penn State is kind of in the middle of nowhere. Not much money can be made here unless you go to national brands,” said Seth Engle who works in the Penn State athletic department. He mentioned how many Penn State athletes have worked with national brands on NIL deals. “You really only see the big name football players getting national brand deals. However our wrestling program has worked with a few big brands. They have been one of the best programs for years now so big name brands have reached out to work with them.”
For an agent, creating an NIL deal is very similar to creating one with a pro athlete. Most schools do have some restrictions, however. A common one is that an athlete cannot work with gambling or alcohol companies even if they are 21. As more players continue to make money, it’ll be interesting to see how diverse the companies are that athletes collaborate with.
How much college athletes can make
In the new age of college athletes getting paid there are some who are making absurd amounts of money.
How much you make really depends on where you go to school and how much playing time you get.
“This also depends on the athlete. If they are the starting QB for Alabama they are making seven figures. If you are a big enough athlete you are making six figures. But I would say a lot of athletes are really just getting free merchandise from a lot of companies rather than money,” said Wydermyer.
Alabama coach Nick Saban said that before the 2021-22 season quarterback Bryce Young had made almost $1 million. That was even before he played a game for them yet. It is not just big time football players getting paid.
LSU gymnast Livvy Dunne is estimated to make more than $1 million annually due to her large social media following. Other college athletes who have thrived on social media are also cashing in big time from the new laws. Some college athletes are doing commercials or meet and greets.
You even see that high school athletes are starting to cash in. One player who stands to benefit is 5 star Quarterback Arch Manning. Louisiana passed a law allowing high school athletes to profit off of their name, image, and likeness. Arch is one of the most highly touted recruits in the past twenty years so you can imagine what his NIL deals will look like in the coming years.
Arch isn’t the only one who is going to profit.
According to The Athletic, a 2023 5-star football recruit got paid $8 million for an NIL deal, with $350,000 paid up front. This is a 17-year-old making that kind of money because of the school he committed to.
Although the name hasn’t been released for this athlete we have seen some big name high school athletes start on their endorsements.
High School basketball phenom, Mikey Williams, is already thinking about the money he is going to make. Williams is the first high schooler to sign with a big name talent representation firm to help him cash in. Williams signed with Excel Sports Management which works with players such as Trevor Lawerence, Deebo Samuel, and Tiger Woods.
Although you see most deals by college football and basketball players, they aren’t the only ones who are taking advantage of these new laws.
According to a study done by Opendorse, a company that facilitates NIL deals, Football leads the way in what college sport makes the most money. Can you guess the second?
My guess would have been men’s basketball, but that would be wrong. The second leading sport is women’s basketball.
It doesn’t matter what sport you make, there will always be companies who are willing to work with the athlete to try and help them succeed in their off the field endeavors.