Schools can make sports betting deals, so why not players?

The multiyear partnership between Michigan State and Caesars Entertainment marks the first sports betting sponsorship for a college in 2022, but it certainly won’t be the last. If there is one sponsorship category that is poised to explode in the new year, it’s sports betting deals in the college space.

With Michigan State joining Maryland (PointsBet), Colorado (PointsBet) and LSU (Caesars) as Power 5 schools with sports betting deals, it begs the question: If schools are able to generate revenue from deals with sports betting operators, should athletes be given carte blanche to do the same, or at least with some guardrails? Many state laws and university policies prohibit athletes from engaging in NIL deals with sports betting operators, even though schools are inking partnerships in the gambling world. 

Casey Schwab, the founder of Altius Sports Partners who spent three years at the NFL Players Association, told On3 during the fall that there is an “interesting equitability argument because the schools are doing deals with sportsbooks, so what’s their stance on their athletes doing it? There is a fundamental fairness point to be discussed. If a school can do it, if a coach can do it, let’s have a serious discussion as to why you think an athlete cannot do it.”

The long-established barrier between the two worlds is quickly crumbling, if it exists at all anymore, as sports betting has become legalized in the majority of states and, as a result, been thrust into the mainstream. With college athletics confronting high demand for new revenue streams, especially amid the COVID-19 pandemic, there now is a warm embrace between schools and the sports betting ecosystem. Industry sources, including Opendorse CEO and co-founder Blake Lawrence, call it a “wave,” one that certainly will come in greater frequency in the new year.

But at the athlete level, it remains a mixed bag.

To date, the most high-profile college athlete to secure a sports betting operator-related endorsement deal is Gonzaga men’s basketball standout Drew Timme, who inked a deal with Northern Quest Resort & Casino. The casino’s website said a new state-of-the-art sportsbook just opened, but all indications are that the sportsbook has nothing to do with the Timme deal specifically.

In a first-of-its-kind deal in the fall, MaximBet announced it would offer contracts to every female athlete in the state of Colorado over the age of 21. The state does not prohibit athletes from working with brands in the gambling category. In order to receive compensation, athletes need to highlight the company on social media.

But last summer, Louisville advised its athletes to cease any NIL deals with Barstool Sports because the school said those do not comply with school policy or criteria outlined in the Kentucky Governor’s Executive Order because Penn National Gaming, which owns and operates casinos, purchased 36 percent of Barstool in 2020.

It’s a slippery slope. 

But even the spate of university deals (Group of 5 programs Denver, Nevada and UNLV also have partnerships) represents a rapid evolution in thinking on the subject. Only three years ago, at the 2019 annual convention, NCAA president Mark Emmert said that sports betting could “threaten the integrity of college sports.” In a July 2020 Senate Judiciary Committee hearing on “Protecting the Integrity of College Athletics,” Pitt athletic director Heather Lyke testified that the legalization of sports betting will have a “corrosive and detrimental impact” on college athletes. And NCAA rules prohibit athletes, coaches and administrators from betting on sports.

But sports betting is far more mainstream these days. If you think you’re seeing more sports betting content on commercials, visible in-venue signage and infused into broadcasts, there’s a reason: You are. The market is exploding, and it’s still early. In total, more than $87 billion already has been legally wagered since the federal ban on sports betting was rescinded in 2018, according to Legal Sports Report. In New Jersey alone, $1.26 billion was wagered just in November. 

With its partnership with Michigan State, Caesars Entertainment will get the naming rights to a premium seating space at Spartan Stadium as well as an outside tailgating area, along with a good supply of sports betting content worked into the broadcast and digital platforms.

Everywhere you look, sports betting is encroaching on college athletics. Big Ten schools are uniquely positioned to take advantage, with online sports betting legal in states where 11 of the 14 schools reside. For schools, leagues and perhaps athletes, it’s only the beginning.  

“Three years from now, sportsbooks are going to own media companies or media companies are going to own sportsbooks,” David Levy, the former Turner Sports president, told On3. “It is inevitable.”

NCAA looking into Oregon NIL deal

The NCAA is seeking information from Oregon about its relationship to a third-party NIL deal, a Sportico report said. The NCAA also has sought information from BYU and Miami about broad NIL deals.

The important caveat: Seeking information is much different than launching a formal investigation centering on potential recruiting inducements of a pay-for-play scheme.

There remains a large question surrounding how much, if at all, the NCAA wants to step into trying to enforce NIL deals and how that would play publicly, now that athletes finally have the ability to monetize their brands.

As Darren Heitner, a prominent Florida-based sports attorney, tweeted: “There are interim rules and the NCAA is conducting diligence. This is very different than an actual NCAA investigation, but it shows the NCAA isn’t dead … yet.”