The rules of the game used to be set in stone. Baseball’s pitch clock and college basketball’s fake fouling warning changed all that. Today, it’s a whole new ballgame with several key trends emerging. Here’s what athletes (and their representatives) need to keep an eye on.
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In June 2021, the NCAA implemented a policy on name, image and likeness (NIL), which allows student-athletes to make money from their personal brand. How has this landmark policy impacted the college landscape?
Athletes are singing the praises of NIL, especially female basketball players. Compensation for their NIL has made it possible for many to stay in college, as they can capitalize on their persona and get their name out there sooner rather than later. Financial success is now within reach versus having to wait to go pro to build social capital.
But not everyone’s on board with the NIL changes. NIL was a motivation behind former Alabama and LSU football coach Nick Saban’s 2023 retirement. While it gives athletes an opportunity to create a brand, Saban said there was no framework in place to preserve competitive balance, leaving the universities who can buy the most players in a position to spend their way to a playing field advantage.
In other words, it’s like the Wild West of college athletics with money flowing, adding stress and pressure for coaches, players, their families and managers alike.
NIL can pose financial challenges if you’re a young player. Large paychecks come with complexities, such as how to invest, spend and manage potentially millions of dollars. A professional business manager can ensure you’re fully compensated for NIL and guide your day-to-day business matters and long-term financial affairs, so you can focus on your performance without distraction over money matters or missed opportunities.
Another key trend is the recent National Labor Relations Board (NLRB) ruling over college athlete unionization. More specifically, the NLRB ruled that the Dartmouth men’s basketball team could form a union because they’re employees of the college. A month later, the Dartmouth players voted to unionize. Forming a union would allow Dartmouth players — who under Ivy League rules don't receive athletic scholarships — to collectively bargain for salary, working conditions such as practice times and travel arrangements.
Advocates say unionization gives athletes control and a voice and ensures equal pay. A survey of 500 top-flight NCAA competitors found that 62% support the idea of unionization to bargain for more rights and protections.
But there are potential negatives. Unionization could cause labor stoppages, long hiatuses or even strikes before major sporting events. Students also face financial ramifications if they unionize. Financial aid and scholarships are currently tax exempt, but wages would be subject to federal, state and local taxes. Classifying student-athletes as employees could also hurt international students, who may no longer be eligible for a student visa.
It’s unsure how the NLRB ruling will ultimately net out, but it is clear that you should get support from a business manager who can help you navigate the nuances of compensation. If unionization takes hold — or you opt to join a college that is unionized — your business manager can also help you maximize that opportunity while avoiding any employment tax pitfalls.
With the advent of DraftKings, PrizePicks and other platforms, more than 80% of betting in the U.S. is now done online. ESPN has even joined forces with Penn Entertainment to present a newly branded online betting platform, offering different betting lounges for several sports. Betting shows have also hit the airwaves; witness the proliferation of YouTube channels and podcasts on betting.
PrizePicks in particular is changing the face of online betting, as it’s a single-player daily fantasy site centered around specific player performance. Considered the everyday person’s betting platform, it never pits the bettor against professionals who use analytics and tools and bet for a living; the bettor simply plays against the site’s projections.
Is the online betting space growing? You bet it is. The global online sports betting market was valued at almost $57 billion in 2023. It’s anticipated to reach $146 billion by 2032.
Athletes can benefit from this phenomenon via increased ticket sales, sponsorships and merchandise sales. However, there is a downside, such as increased pressure to perform and win from those who placed bets.
Sports betting is the future of fan engagement. While it can mean greater financial returns, athletes risk leaving money on the table. A business manager can ensure all sales, sponsorships and events — and NIL — are tracked and compensated, and steer your long-term financial growth. Equally important, a business manager can keep a close eye on every movement of funds to ensure there is no foul play or misappropriation of assets.
Also unfolding are streaming platforms, especially joint ventures like Fox, ESPN and Warner Brothers. Typically, streaming services are standalones such as YouTube TV, Peacock and Amazon Prime Video — all working independently. The new joint streaming service, which is set to launch in late 2024, will offer ESPN, Fox and Warner Brother’s network and cable channels, as well as streams from the ESPN+ direct-to-consumer service with a single subscription.
By broadcasting the games on one streaming channel, fans experience a more seamless viewing experience versus having to tune into different platforms. The benefit to the athlete? Streaming grows the audience, which increases your commercial opportunities and financial gain. It also provides additional outlets on which to promote your brand.
Partner with a business manager who understands the sports and media space and the financial potential of these lucrative outlets. They can help you assess how they fit into your long-term financial goals. What if you’re featured in a streaming show? How do you structure your royalty agreement or invest your income? Your business manager needs to have the answers to these questions and more.
Currently, there are eight major league sports teams looking for new homes, including the Chicago Bears, Oakland A’s and Tampa Bay Rays. The Bears are breaking ground on a new stadium in 2025, while the A’s are relocating to Las Vegas in 2028. The Bay Rays expect to unveil their new home in St. Petersburg, Florida in 2028.
What effect can these new stadiums have on athletes? Typically, fan attendance grows, especially during the “honeymoon” period where everything is new and improved. More interest in the team could help boost player salaries and potential player sponsorships.
A new stadium ignites fan excitement. Add great team performance and it’s a given that fans will stay loyal in person and as viewers. That, in turn, could translate into bigger salaries, sponsorships and merchandise opportunities for athletes. As with any opportunity that could potentially increase your net worth, a business manager is key to helping position you for maximum financial gain.
If record-high viewership of this year’s NCAA Women’s Final Four is any indication of a boom in women’s sports, we’re in for huge growth in this sector. In-person attendance was also one for the books, with the “Caitlin Clark effect” helping Iowa’s conference sell out to nearly 109,000 fans.
The Southeastern Conference also saw big numbers with 64,000 fans visiting Greenville, South Carolina, and 13,000 showing up for the title game between South Carolina and LSU. ESPN averaged 1.96 million viewers, up 126% from 2023.
Clearly, women’s sports is big news. So is the potential for player income. Clark, for instance, is set to ink a $28 million endorsement deal with Nike. In NIL, she made an estimated $3.1 million in earnings. And she’s not alone. MarketWatch found that many college athletes now make more than the pros from NIL earnings, including basketball player Angel Reese and gymnast Livvy Dunne.
As women’s sports continue to thrive, both collegiate and professional female athletes could realize considerable income growth. Building your brand early could lead to long-term income. That requires guidance from a business manager during the hype years and an advisor to help you stay relevant after your college or pro career matures.
AI and technology have been a part of the sports conversation for some time, but never like this. For the 2024 NBA All-Star Game, the NBA unveiled a 27-million pixel floor that will essentially become a Jumbotron under the players — displaying graphics, video replays, player-tracking animations and interactive games. Many think that this could revolutionize the way sports are presented in arenas and on television broadcasts.
Sponge Bob also made an appearance at this year’s Super Bowl broadcast, which opened with the Nickelodeon character and his Bikini Bottom pals recreating their performance of “Sweet Victory” from an old episode of the cartoon. The tech that brought us SpongeBob in the booth is not only bringing a creative spin to the traditional broadcast, it’s making sports more attractive to different audiences. Record viewer numbers are a testament to that.
Partner with business advisors who stay abreast of the latest advancements in sports tech, so you’re well positioned to take advantage of them. If a company is designing a new virtual or mixed reality experience, for instance, that may be an opportunity for a NIL deal for you.
Staying ahead of the intricacies of NIL policies, unionization, new technology, privacy and other issues that impact your brand can be overwhelming. Learn more about how Armanino’s trend-savvy business management experts can help you maximize your earnings, protect your rights and secure your legacy in an always-evolving industry.
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