College athletics has entered a new phase. Legislative action by a number of states has led the National Collegiate Athletic Association to open the gates for athletes to be compensated for their work, or at least for their fame and marketability.
The previous college sports model was based on amateurism, tied to the principle that the cost and value of the education that the athlete was receiving — while playing ball — was compensation enough.
Now, with the new name, image and likeness opportunities out there, athletes and entire teams are cashing in. A protein bar producer is essentially paying the tuition for walk-on (non-scholarship) players on the Brigham Young University football team. A Miami gym owner has offered $500 per month to every player on the University of Miami roster.
Kayvon Thibodeaux, a top-ranked pass rusher for Oregon, has reeled in a six-figure deal from Nike, whose co-founder, Phil Knight, has been burying Eugene under an ocean of cash since he earned his first billion. The difference, though, is that previously Knight’s largesse was limited to buildings such as stadiums and arenas (as well as facilities that serve an educational purpose).
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Now, he can pay players as well. Others might frame it as buying players.
Then there is Alabama sophomore quarterback Bryce Young. His coach, Nick Saban, who makes roughly $10 million per year, has noted that Young already has hauled in $1 million in endorsements. And it’s interesting to reflect on the fact that some of the early backers of NIL opportunities noted the unfairness of coaches such as Saban earning millions, while some struggling student-athletes could not afford a pizza.
Now, Young can buy a pizza parlor. Or maybe vineyard property. Or get that IRA humming in case this football gig doesn’t work out. He can’t drink the wine, though, at least not legally. Young doesn’t turn 21 until next July.
Amid a time of intense change for college athletics and, by extension to the colleges and universities themselves, the questions just seem to multiply and multiply.
Is it really a good idea to add agents to the platoons of coaches and other individuals who enter the living rooms of 17-year-olds to try to persuade them to sign something?
If the Alabama QB is destined to be a millionaire year in and year out what would motivate a top prospect to choose Mississippi State instead? You are throwing away money. Competitively, meanwhile, the Bamas, Clemsons and Georgias of the football pantheon might just become more dominant moving forward than they already are.
What happens to team chemistry? If the running back makes $250,000 and all the offensive linemen who are blocking for him get are FieldTurf burns and sore backs … what happens to unity within the squad?
What happens to other sports? Will there be any cash left over for soccer and volleyball players?
The biggest question of all, perhaps, is what will this mean for Oregon State University and its athletic teams? Will OSU athletics crater amid massive athlete cash flow disparities or will the Beavers gnaw and scratch and claw their way to glory, just like the mascot the university champions?
Mid-Valley Media has spent the past month interviewing people inside and outside of the university on the NIL issue. The exchanges have been largely via email because of COVID. Please note, for the record, that at this point most of the folks analyzing this issue also have more questions than answers. And some of the questions just produce more questions.
The OSU reaction
Almost to a person, university officials think its athletic program will be just fine, thank you very much.
“OSU athletics programs will remain highly competitive,” said interim President Becky Johnson. “We have great coaches and administrators, and we recruit excellent student-athletes that are a good fit for Oregon State University and our academic programs.”
Athletic Director Scott Barnes said that the big-money deals noted above really don’t change anything from the Beavers’ perspective.
“These types of deals are extremely limited, and time will tell what impact NIL programs will have on competitive equity within college sports,” Barnes said.
“I believe that the approval of federal NIL legislation would be helpful in providing consistency across the nation. That said, there always have been differences and significant gaps in resources across college athletics programs nationally. I see these gaps continuing.”
“I think it’s way too early to measure the impact that NIL might have,” said football coach Jonathan Smith. “I’m supportive of the new NIL guidelines and believe they allow our student-athletes the ability to pursue opportunities that they couldn’t have in the past.”
Men’s basketball coach Wayne Tinkle spoke of challenges, such as revenue and team unity as well as time management hurdles for students, but he also countered with a “but clause” indicating that he felt the challenges could be overcome.
“There are concerns with what the disparity of potential revenue streams can cause to our chemistry, but we’re confident that if they arise, we’ll be able to work through them,” Tinkle said. “This definitely puts more on their plates, but we feel we have the resources at OSU to help student-athletes budget their time appropriately and handle both their academic and athletic responsibilities.”
Women’s basketball coach Scott Rueck spoke of the uniqueness of what the college sports world is going through.
“This is a fascinating time in college sports, and I am excited to see how NIL guidelines will impact our sport,” he said. “As time passes and this new era plays out, I am confident we will remain competitive in the Pac-12 and as well as nationally.”
No information is yet available on how many OSU athletes have signed endorsement deals or selected agents. The university policy requires that athletes disclose all NIL contracts as well as agent representation.
Which will mean whole new layers of labor for those working in the seldom-noted “compliance” realm of athletic departments at OSU and elsewhere.
The NIL revolution also has created a burgeoning industry of companies looking to “help” athletes with their NIL portfolios. Oregon State has signed with Opendorse, a Lincoln, Nebraska, company that appears — remember, we’re early in the game here — to be one of the major players.
Opendorse, says a USA Today story on the process, “pairs athletes with marketers, collects payments and reports everything to compliance personnel.”
OSU AD Barnes said “significant work has been undertaken within OSU, particularly in building the educational platform and writing policy. Our NIL program includes assistance from the OSU General Counsel’s Office, our athletics department NCAA compliance office, consultants and other partners to assist in delivering educational content for student-athletes regarding NIL.
“OSU’s College of Business and former OSU football great Stephen Jackson are among those who will deliver educational content as part of our program.”
OSU’s program, according to the eight-page policy manual the university has prepared (see the website for the full text), includes information on:
• Proper compliance and disclosure;
• Life skills, career development and financial literacy;
• Business formation and tax liability;
• Impact on financial aid.
It is unclear what role Jackson, who was a standout running back for the 2001-03 Beavers and in the NFL, will play in the process. He did not respond to a request for information on his involvement.
One aside on the policy manual that shows how quickly the NIL landscape is evolving: The university forwarded the policies to Mid-Valley Media on Sept. 13. The “history” section of the document noted that it had been amended that very day.
Most of the endorsement news since NIL became a fashionable acronym has involved football players, but for OSU, it seems likely that the athlete most likely to cash in will be a gymnast.
Jade Carey has joined the Beavers’ squad after a summer in which she won the gold medal in the floor exercise at the Tokyo Olympics. Such success often results in appearances on Wheaties cereal boxes and “The Tonight Show.”
“I do know she is working with an agent that helps with her NIL endorsements but as of now they aren't willing to share any more information,” said Aimee Sinacola, who handles sports information requests for OSU gymnastics. “I think her agency is just working on the right fits for her.”
Carey, and many of her USA gymnastics teammates who also will be performing for college teams in the upcoming season, are in a unique position. Performing on TV screens all over the world during the Tokyo Games gave them visibility — and marketability — that would be virtually impossible to achieve for those in other sports who are moving on to college careers.
Also interesting to watch will be the NIL impact on OSU baseball, arguably the most successful Beavers franchise, with six College World Series appearances and three national titles since 2006. Players such as Jacoby Ellsbury, Darwin Barney, Michael Conforto, Nick Madrigal and Trevor Larnach already have advanced to the major leagues, with Baltimore Orioles phenom Adley Rutschman almost certain to join them soon. How big will the NIL market be for Beavers baseball stars? We told you there would be more questions.
The former Beaver
Ryan Nall, a former OSU running back (2014-2017) who is now in the NFL, has a perceptive lens through which to view the NIL revolution.
“It definitely brings a business side to it,” said Nall via telephone from Chicago, where he is on the practice squad for the Bears. “It’s just like it is in the NFL. Some guys are going to get endorsements … and some won’t.”
Nall noted that until NIL, NCAA rules prevented athletes from working (the reason such rules existed was because of massive fraud, but that is a story for another day).
“We only got a stipend,” Nall said, “and that wasn’t really enough to get by. I think (NIL) will be a good opportunity for kids to earn money while in college.”
Nall, like coach Tinkle, can see the time management challenges.
“It definitely would have put a lot on my plate,” he said. “But if someone wants to go in that direction ... at the end of the day it’s their choice. But they have to fit it into their schedule. Some guys might want to go see their family or their girlfriend or go to study hall or do their homework.
“It would definitely have to be someone good with time management.”
Nall also said he recognizes the challenge OSU faces in the new marketplace.
“The location definitely factors into it,” he said. “In L.A. and Chicago there are definitely more opportunities. You see that also in the NFL and with free agency in the NBA.
“People don’t want to go to Portland because it doesn’t have the size of market like L.A., Chicago and Miami.”
When asked if NIL will lead to OSU being less competitive, Nall said “it might and it might not. OSU doesn’t always get the 5-star guys like other schools, but they develop their players and help them improve. And if those 5-stars are spending all their time looking for endorsements while coach Smith is developing his players … OSU can still have winning seasons and go to bowl games.
“Look at Jordan Poyer,” Nall said, of the former Astoria High standout who starred for the Beavers from 2009-12 and is now with the Buffalo Bills. “He worked his tail off and now he’s one of the best safeties in the league.
“It’s guys like that who are willing to put in the work … that is what can make Oregon State successful.”
Thus far the Pac-12 Conference has announced one NIL arrangement that will allow conference athletes to use Pac-12 network footage and highlights as part of marketing, social media or endorsement deals.
OSU’s policy manual, however, is firmly against similar linkups.
“Oregon State’s policy is that social media content used to promote a student-athlete’s name, image and likeness for financial benefit cannot use university or athletics department content,” AD Barnes said. “For example, a student-athlete cannot use our university trademarks in an Instagram post promoting a local restaurant.”
This leaves OSU out of the co-licensing and group licensing niches that have sprung up from NIL seeds. Co-licensing involves permission to use logos and trademarks. Group licensing, in which a school and an athlete essentially become partners, allows both entities to profit from the sale of jerseys.
And then there is the participation of the business community, an area that would seem to put OSU at a disadvantage against schools from bigger Pac-12
Conference markets such as Los Angeles, Seattle, Phoenix and the San Francisco Bay Area. Seems is a good qualifier here. Clemson, Georgia and Alabama seem to be doing well despite their presence in towns that aren’t exponentially larger than Corvallis.
Mid-Valley Media checked in twice with Simon Date, president and CEO of the Corvallis Chamber of Commerce. He said he has not heard anything about local businesses looking to “invest” in OSU athletes, but he added that “it’s a cool idea.”
Mid-Valley Media also reached out to five Oregon-based companies known for their sponsorship of OSU athletics. Representatives of Pacific Office Automation, Dutch Bros and Dari Mart all said they had no plans to do any marketing with Beavers sports stars. Reser and Coastal did not respond to requests for information.
What happens if an athlete signs with Wilco, despite the university's relationship with Coastal?
"There may be a time in the future when a NIL agreement involving a student-athlete NIL deal conflicts with an exclusive OSU athletic department sponsor," Barnes said. "Should that occur, an evaluation will be made on a case-by-case basis.”
Also, what sorts of penalties or sanctions that might ensue if there are abuses remains another … question. The NCAA has been all but emasculated in the NIL tsunami and the whole concept is so new it’s hard to even KNOW what an abuse might look like.
Inevitably, there will be athletes or schools who make poor decisions. What then?
Casey Schwab is CEO and founder of Altius Sports Partners, like Opendorse a new company heavily involved in NIL. He noted the challenge of adjudicating NIL foul-ups that involve more than just an athlete or a school.
“The NCAA can’t punish Subway or Verizon or the local pizza joint for doing something wrong," he was quoted as saying by USA Today. “Who’s going to get the letter? Who’s going to get suspended?”
Stay tuned. There will be more questions.