Ryan O’Leary: NIL rules have opened doors for some, but not all

Less than a decade ago, the NCAA wasn’t even allowing college athletes to put cream cheese on a bagel.

Today, some of them are stacking some serious cheddar.

Several lawsuits over the course of the 21st century have chipped away at the antiquated notion of “amateurism,” which the NCAA spent millions of dollars trying to defend. Last year, the dam finally broke, and collegiate athletes all across America are now free to earn money off of their name, image and likeness — or, as it’s most frequently seen and heard in common conversation these days, NIL.

The game has changed rapidly as a result. Colleges aren’t directly paying players, but brands are able to connect with athletes through alumni-led collectives and various other companies. The biggest names in college athletics now have the ability to become millionaires before they graduate.

And NIL isn’t just impacting the college game. High school athletes — at least those living in the states that allow it — are cashing in as well, some to the tune of hundreds of thousands, or even millions, of dollars.

It’s a whole new world.

Right place, right time

Making money wasn’t an option for Trayce Jackson-Davis during his first two seasons playing basketball at Indiana University. But around the time that the Center Grove graduate decided to return to Bloomington for his junior year instead of keeping his name in the NBA, a landmark court case fundamentally shifted the landscape of college sports.

In 2019, West Virginia University football player Shawne Alston and University of California women’s basketball player Justine Hartman filed lawsuits — later combined in court as NCAA v. Alston — alleging that the NCAA was violating antitrust laws by restricting “non-cash education-related benefits.” District and circuit courts ruled in favor of the athletes, and the United States Supreme Court upheld those rulings on June 21, 2021.

NIL wasn’t specifically addressed, but it was hinted at — particularly in a concurring opinion by Justice Brett Kavanaugh.

“Nowhere else in America can businesses get away with agreeing not to pay their workers a fair market rate on the theory that their product is defined by not paying their workers a fair market rate,” he wrote.

Nine days after the ruling, the NCAA passed interim legislation allowing athletes to earn money off of their athletic notoriety.

Jackson-Davis has benefited from the change. This spring, he was named as one of the IU athletes earning compensation from Hoosiers for Good, an NIL collective that partners Hoosiers in various sports with different charities and pays them for their promotional efforts. He has also reportedly signed endorsement deals with Pennzoil and Merchants Bank of Indiana for undisclosed amounts, and last week he was one of four men’s college basketball players to sign an endorsement deal with Adidas.

On3.com, a website that tracks NIL deals and calculates estimated valuations for high school and college athletes, lists Jackson-Davis’ projected annual value at $611,000. That figure ranks 11th in men’s college basketball and 61st among all non-professional athletes nationwide.

Other Johnson County natives have also done well for themselves. Jackson-Davis’ younger brother Tayven Jackson, a freshman quarterback at the University of Tennessee, has inked a couple of smaller NIL deals and has an estimated annual value of $117,000, according to On3. Former Center Grove football teammate Carson Steele, a running back currently in the transfer portal after playing the last two seasons at Ball State, is valued at $173,000 annually despite no known agreements; another ex-Trojan, Ohio State defensive lineman Caden Curry, has an estimated yearly worth of $52,000.

Such is life as a major-college football player in 2022.

Room at the inn …

While football and men’s basketball players have been getting the lion’s share of the money — several stars at the top collegiate programs are pulling in six to seven figures — other athletes have found their own NIL lanes as well.

For some, it’s a lucrative one. In July, Forbes reported that twins Haley and Hanna Cavinder, who built a massive social media following during the 2020 pandemic shutdown and now play together on the women’s basketball team at the University of Miami, had accumulated more than $1.7 million in NIL deals. The No. 5 athlete on On3’s NIL 100 is LSU gymnast Livvy Dunne, who has an estimated annual value of $2.6 million.

But Dunne and the Cavinder twins are the exceptions, not the rule; most women’s basketball players and athletes participating in non-revenue (“Olympic”) sports, are cashing in on a much, much smaller scale.

Emma Utterback is just fine with that. The Center Grove graduate, now a senior point guard at the University of Vermont, has parlayed her fairly large social media following — more than 40,000 followers on TikTok and nearly 15,000 on Instagram — into a handful of deals.

Through an NIL app called Postgame, Utterback has been able to get compensated for promoting various brands on her social media accounts. In some cases, that compensation is just in the form of free products; others, like the deal she landed with British clothing company Missguided, got her a few hundred dollars on top of some free clothing.

“I actually normally shop there for my everyday-type clothes,” Utterback said, “and (Postgame) paid me like $200 to have a post on Instagram or TikTok of what I got in the mail, and I got $100 to spend on the website.”

Other companies are looking to help more athletes in Olympic sports get a piece of the pie.

Dan Dykens is the co-founder of a company called Honorarium that plans to officially launch before the end of this month. It expects to operate somewhat similarly to websites like Patreon or Cameo in the sense that fans can “honor” athletes of their choice and pay them money in exchange for some form of exclusive content (NCAA rules prevent athletes from receiving something for nothing).

The chosen athlete would receive the majority of that money, but a percentage would also be distributed to his or her teammates and any other athletes at that same school who are signed up on the Honorarium platform.

“There’s only so many brands, and there’s only so many superstars,” Dykens said. “What our company’s looking to do is to level the playing field. With our platform, every athlete has a realistic chance of earning NIL dollars.”

Honorarium has dozens of athletes pre-registered, ranging from football players at FBS schools to Olympic athletes in Division III.

… But not for everyone

While college athletes of all shapes and sizes have been able to get compensated since the Alston decision, On3’s list of most valuable NIL commodities is actually topped by three high schoolers. Bronny James, the oldest son of NBA legend LeBron James, is the runaway leader with an estimated annual value of $7.5 million — thanks in large part to endorsement deals with Nike and Beats by Dre that pair him in TV ads with his father. Not far down the list is quarterback Arch Manning (third at $3.4 million per year), nephew of Colts legend Peyton Manning and the top-rated football recruit in the 2023 class.

But while many of the nation’s top prep athletes are making the most of their newfound financial opportunities, Max Clark is not. Because he can’t.

Clark, a senior at Franklin, is the top-rated high school baseball player in the country and on the short list of players who could be the first overall pick in next summer’s major league draft. He also has a massive following online (including more than 200,000 followers on Instagram).

As a result, he’s got several lucrative endorsement offers in front of him — but he can’t sign any of them. At least not if he wants to be eligible to play for the Grizzly Cubs this spring.

“I’ve had my fair share of national companies reach out, and they wanted to do some awesome deals,” Clark said. “There were sunglass companies, bat companies — basically things you see in everyday (Major League Baseball) — and right now everything’s just kind of on hold. Regardless of if I go to (college) or get drafted, they’re going to be there on the table when I get there, but because of the rules I can’t do anything right now.”

The rules in question were put in place by the Indiana High School Athletic Association, whose bylaws explicitly state that student-athletes “cannot have accepted remuneration, or a benefit other than of a symbolic nature, directly or indirectly, for athletic participation in that sport, or capitalized on athletic fame by receiving money or gifts of a monetary nature.”

Much like Alston, Hartman and several others before them did on the collegiate level, Clark argues that the IHSAA’s rules are outdated and unfair. High school students with special and marketable talents in other areas — music, science, or anything else — can go out into the world and get what they’re worth. In Indiana, young athletes can’t.

If the feelings of IHSAA commissioner Paul Neidig are any indication, they won’t be able to anytime soon, either. Neidig doesn’t believe there’s any hypocrisy in denying athletes the ability to market themselves while their peers can do so in other fields.

Somewhat tellingly, his talking points resemble those used by the NCAA for decades before their arguments — which were essentially boiling down to “capitalism for me, but not for you” — were finally blown up in court.

“I just don’t think in a developmental program, an education-based program, that NIL should be in the forefront of what we do,” Neidig said, “because it takes away from the focus of education, in my opinion.”

Data on exactly how many grade-point averages were adversely affected by students signing endorsement contracts with Old Hickory Bat Company was unavailable at the time this column went to press.

Former IHSAA commissioner Bobby Cox earned $193,672 in 2020, according to tax filings collected by ProPublica’s Nonprofit Explorer. Each assistant commissioner made more than $125,000 that year, the last for which individual salary information was available. Executive compensation has increased fairly steadily year to year within the organization, per previous tax data, so it’s reasonable to estimate that Neidig will collect slightly north of $200,000 this year — and each of his assistant commissioners a comfortable six figures — for running an operation that oversees athletes who can’t accept a dime.

Capitalism for me, but not for you.

An uncertain future

The NIL world has blown up so much and so quickly that everyone’s still scrambling to understand the big-picture ramifications of it. College sports will almost certainly look somewhat different in the years to come, but in the year-plus since Alston opened the door for athletes to get a piece of the pie, the system hasn’t fallen apart — and with major college conferences negotiating larger television deals than ever this year, it doesn’t seem likely to implode anytime soon. Neither big deals (Jackson-Davis) nor small ones (Utterback) have derailed the NCAA’s money train.

The sky hasn’t fallen yet. Imagine that.

As for high school athletes, 32 states have enacted NIL legislation allowing for compensation prior to college. And while it’s possible that the Indiana state legislature will step up to the plate and overrule the IHSAA by doing the same, that’s probably unlikely. The Hoosier State figures to remain closed for business, at least on a prep level, for the foreseeable future.

Clark would obviously stand to gain plenty from a modernizing of the rules here, but that’s not the only reason he wants to see the IHSAA come around. He knows he’s not the only one missing out.

“There’s a huge range where kids can make money,” he said. “It’s just, we have to be able to do it. I advocate for it, not just for me, but I think it’s a good way for kids who want to build a brand around themselves, they can embrace their brand and share it with other people.”

Sounds a lot like what the adults have always allowed themselves to do.

Ryan O’Leary is the sports editor for the Daily Journal. He can be reached at [email protected].