Over the first six-plus months of the NIL era, the only constant has been change. After the initial summertime flurry of attention-grabbing headlines, group licensing deals then became all the rage. As fall turned to winter, attention turned to a handful of highly marketable female basketball players who found innovative ways to monetize their brand. And as the calendar flipped to 2022, the conversation has shifted once again, debating how deep-pocketed boosters may pool funds to create a new type of recruiting arms race.
On3 caught up with 13 leading voices on NIL — well-respected experts and industry veterans from all corners of the space — to look into their crystal ball and answer one question: What’s your biggest NIL prediction for 2022? They touched on everything from the overall size of the market to implications for taxes, recruiting, brands, Title IX, activations, education, NCAA enforcement and, of course, potential federal legislation.
The experts are listed in alphabetical order.
More growth, evolution, opportunity
From John Brody, chief revenue officer at Learfield
“As the classic Nina Simone song reminds us, ‘It’s a new dawn, It’s a new day,’ and as 2022 begins, the collegiate athletics space is gearing up for a year of growth, evolution and opportunity. It’s only been six months since NIL first became more than a topic up for discussion. It is now firmly here and changing by the day. All of us at Learfield see the continuing development of NIL as a positive for our industry.”
More money, more brands involved
From Jim Cavale, founder and CEO at INFLCR
“Brands that weren’t prepared to participate are now going to go into 2022 with a lot of firepower in their budget for student-athlete NIL endorsements. My second prediction is the market is still not as big as everyone makes it out to be, and it will take a lot of time to continue to progress because it’s harder than people thought for student-athletes to actually activate their NIL. With my first one, brands didn’t know how wide-scale NIL was going to be in 2021 because a lot of people assumed that if the NCAA wasn’t going to set nationwide rules, it was only going to be limited to the schools and states that had laws. But what happened with the waiver the NCAA passed at the end of June, it made it so any school could set its own policy. Businesses didn’t know how it was going to shake out, so they didn’t have it in their budget.
“You’re going to see a lot of companies that have native connection to sports, like Brine with lacrosse, like Prince with tennis. These companies are going to come in this year with firepower, with a strategy, with money, ready to do influencer marketing and endorsement campaigns with student-athletes by the tens, by the hundreds, by even the thousands. It’s going to give student-athletes in those sports an opportunity to really promote and sell for that brand to their followers. The second one is still going to take time to progress. It’s simply that the multibillion-dollar market everyone said this would be is still a reality. But as you’re seeing, it’s not easy for an athlete on top of school, on top of workouts, on top of playing, to build and run an NIL business. At the pro level, there’s agents, there’s players associations, there’s a lot of resources around the athlete to help them find opportunities and support them in the activation and fulfillment of those. Student-athletes are still figuring that out.”
From Katie Davis, Partner & Collegiate Athletics Practice Leader at James Moore & Co.
“There’s going to be a lot of surprised athletes come April 15, 2022, when taxes are due. Non-cash NIL deals in particular pose challenges for athletes who may not have the cash to pay in. There will be scrutiny by the IRS and various state departments of revenue as they pay closer attention to these deals and deciding who gets a piece of the pie. Paying taxes isn’t a reason to avoid an NIL deal. I believe more schools and athletes will pay closer attention to quality education and other resources to help athletes navigate taxes in the coming years.”
Institutional involvement in NIL facilitation
From Andrew Donovan, vice president of collegiate partnerships at Altius Sports Partners
“In light of the autonomy granted to each division through a new NCAA constitution, and absent enactment of federal legislation that says otherwise, I anticipate adoption of Division I legislation that permits — or at least does not explicitly prohibit — institutional involvement in identifying and facilitating NIL opportunities for athletes along with revisions to many state laws to permit the same. This autonomy will not negate the myriad related issues institutions must recognize and navigate including potential legal liability, Title IX and locker-room dynamics, but it will bring us yet another step closer to a Division I, or some variation thereof, model in which institutions may one day participate in the acquisition of athletes’ NIL rights.”
A revisiting of state laws
From Darren Heitner, founder of Heitner Legal and sports law professor at the University of Florida
“I believe that we will see many more big brands enter into endorsement deals with college athletes in 2022. States will revisit the laws that they passed over the past couple of years to determine whether it makes sense to ease up on some of the restrictions put in place so as to remain competitive with the states that do not have any NIL laws in effect. The federal government will not be successful in passing legislation to establish a uniform law to govern all college athletes throughout the country. The NCAA will continue to be quiet in the wake of the 9-0 decision in Alston. Some people will continue to complain about the creation of a free market for college athletes, while I will continue to try to educate those people on why athletes should have never had their rights of publicity taken away from them.”
More protection of an athlete’s intellectual property
From Dale Hutcherson, Memphis-area attorney who specializes in sports and trademark law
“Education related to NIL will expand to include subject matter that is more pertinent to the majority of student-athletes who will not receive big endorsement deals but will be able to more freely flex their entrepreneurial muscle. The educational subjects that will likely be expanded on will include how to build your own business and brand, how to protect your personal brand and business through setting up business entities and protecting intellectual property such as trademarks, copyrights and patents, financial and wealth management, how to invest your money rather than spend it, etc. Another prediction I have is that protecting intellectual property will become a major point of emphasis for athletes looking to build their brand and new business ventures. To have proprietary interests such as trademark ownership is to have power in controlling your destiny in the business world. Athletes will not only be able to protect their brand, but they will have more opportunities to make money through licensing their name, image, likeness and brand based on the proprietary interest and ownership of intellectual property rights.”
NIL a fertile field for lawmaking and litigation
From Malik S. Jackson, attorney at Jacksonville-based Smith Hulsey & Busey
“The NIL market is a triangle with three sides: 1. Athletes and their families; 2. NIL compensators; 3. Athletic institutions, including coaches, conferences and divisions. Stakeholders loyal to one of these camps will jockey for influence to shape NIL opportunities, products, services, ownership, control and forms of compensation to athletes. NIL rights offer a fertile field for lawmaking and litigation about institutional control, enforcement rights, employment status, gender equity and minor athletes’ rights. Whose interests will the NIL era serve? Participate, or wait and see.”
An NIL collective at each Power 5 school
From Blake Lawrence, co-founder and CEO of Opendorse
“In 2022, student-athletes will collectively earn hundreds of millions of dollars in NIL compensation from four main sources: fans, brands, sponsors and donors. Here’s what student-athletes can expect from each group and a bold prediction for what’s to come.
“Fans: Student-athletes with an entrepreneurial spirit will earn NIL compensation by hosting camps, selling merchandise, video shoutouts and more to fans looking to connect with their favorite players in new ways. Prediction: Every football, men’s basketball and women’s basketball student athlete will have a jersey for purchase in the fall of 2022 in states where co-branding is allowed.
Brands: Student-athletes with large social audiences will continue to earn deals from national brand partners, who will become more comfortable booking NIL deals as they see their peers spending big and generating real ROI. Prediction: Schools will invest in media production to help their athletes earn passive income from monetization; think Twitter pre-rolls ads or podcast sponsorships.
Sponsors: Student-athletes actively involved in their community will be rewarded with NIL deals from school sponsors, who will team with Learfield and other partners to maximize co-branding opportunities. Prediction: Multimedia rights holders will see a 20 percent lift in sponsor spending by adding NIL deals to their offering. Envision billboards and local TV spots loaded with in-uniform student athletes promoting local businesses.
Donors: Student-athletes from revenue sports will continue to receive outsized support from donors, who will lean on collectives to ensure their NIL transactions are compliant. Prediction: There will be an NIL collective for every Power 5 school by the end of 2022. And the top collectives will spend $10 million per year on NIL.”
Expect Title IX issues
From Peter Schoenthal, CEO of Athliance
“Social media posts have led the way as the most popular type of NIL deal for student-athletes thus far. In 2022, athletes, especially those who are now in the offseason, will get creative engaging in camps, lessons, merchandise, and appearances. [Also], there will be Title IX issues: Institutions will find themselves in hot water in regard to Title IX requirements as they begin facilitating NIL opportunities to ‘keep up with others.’ It will be difficult for institutions to maintain equality between men’s and women’s NIL opportunities while also feeling pressure to act.”
Discussions about employment rights
From Casey Schwab, CEO of Altius Sports Partners
“If folks were surprised by the impact of NIL as we closed out 2021, everyone should buckle up. Because more change is coming — from more expansive, structured and lucrative NIL deals to discussions around employment rights for college athletes. In 2022, we will see lawsuits advance, like the Johnson employment rights case, and NIL bills introduced, like the Athletes’ Bill of Rights, that continue to move the end game further away from ‘the way it used to be’ in college athletics.”
Brands valuing being an athlete
From Jon Stainer, managing director of Nielsen Sports in the Americas
“The athletes’ and the schools’ brand marketing potential will outweigh the power of [the athletes’] game performance. Brands will really lean on the marketing benefits and value of athletes going forward. Game performance is often an important determinant of marketing power, but brands will put a significant focus on the relevance, the fit, the profile and the scale of the athletes and their schools as well — the associated value of the schools as well, in determining some of their investment decisions. That really plays into why we created the Nielsen Impact Score because that’s the logic that major brands and major advertisers apply to their media marketing and sponsorship investments. That’s the big one for me. What will come off the back of that as well — the power of the athlete brand and the power of the school brand — is that we’ll see some diversification in the types of deals that are being done. What we’ve seen thus far is the focus has been all around social posting, social amplification, driving branded content through social channels. We will see an extension to the IP of the athlete, whether that is in player appearances, whether that’s in coaching and summer camps, or whether that’s in clothing and leisure wear and things like that. So we will start to see that broaden beyond just the social platforms going forward.”
More group licensing deals
From Malaika Underwood, senior vice president of licensing at OneTeam Partners
“A few broad-scale group licensing programs, which include athletes across schools, will hit the market in 2022. Since the landscape changed, we’ve mostly seen college athletes realize their individual value. This year we’ll see college athletes start to realize their collective value. And that’s when fans will get what they want — jerseys, trading cards and video games that include their favorite college athletes!”
From Mit Winter, sports attorney at Kansas City-based Kennyhertz Perry LLC
“In addition to more brands doing NIL deals and the number of NIL deals continuing to rise, I think we’ll see the NCAA commit to full-fledged investigations of at least a few NIL deals that are perceived to be recruiting inducements. We know that boosters/businesses are getting heavily involved in discussing NIL deals at some schools, and I think some of them may be getting sloppy in how they are describing potential deals to current team members and recruits. It’s fine to describe the opportunities that will exist upon attending a school, but promising deals in return for a commitment is a violation of NCAA by-laws and many state laws. Boosters and businesses are likely sometimes crossing that line. With the NCAA only having a limited number of NIL by-laws, I think they’ll begin putting some effort into trying to enforce them. It won’t be an easy job since the NCAA doesn’t have subpoena power or other discovery tools at its disposal, but I think it’ll try.”