Andrew Baim
In July 2013, the NCAA opted not to renew its licensing contract with video game designer Electronic Arts, effectively setting an expiration date on the NCAA EA Sports series.[1] The NCAA assessed too much risk in the deal, following a class action antitrust lawsuit led by former UCLA Bruin Ed O’Bannon, who found his image and likeness in NCAA Basketball 09 without permission or compensation.[2] So long as the NCAA forbade players from obtaining compensation for use of their name, image, and likeness (NIL), while the NCAA profited from their use, the NCAA would be susceptible to such suits ad nauseum.[3]
EA had the ability to extend the series through 2017 following an agreement with the Collegiate Licensing Company (“CLC”), but by 2014 put the series on hiatus following the departure of the Big Ten, Pac-12, and Southeastern conferences from this arrangement.[4]
Fast forward to February 2021, when EA Sports officially announced the return of the college football series, under the new title EA Sports College Football, following a partnership with the CLC.[5] This begged the question whether anything had really changed from 2014. Players’ NIL would not be in the game, and it lacked the support of the full NCAA.[6] How much of a college football game could it really be?
Thankfully, we may never need to answer that question. On June 30, 2021, the D1 Board of Directors approved an interim NIL policy, whereby college athletes in D1, D2, and D3 divisions could be compensated for their NIL beginning July 1, 2021.[7] This policy is not an absolute rule, as there is no overriding federal law, and there is disagreement among state law, regarding such compensation contracts.[8] Players, therefore, must check with the laws of the state in which they attend university, and potentially with any conference-specific rules, to determine what sorts of limitations may be imposed on their NIL contracts.[9]
Although this could be a windfall for schools residing in states without such restrictions, college student-athletes still cannot violate pay-for-play rules or receive financial incentives to sign or remain with a program.[10] This can be a fine distinction to make, and thus an outstanding concern is the impact of the NIL market on school recruiting programs, and how to determine when a program crosses a line.[11] Many of the qualities that make a school more attractive mirror those that provide greater tools to negotiate for lucrative NIL contracts. Time will tell how problematic this may become. For student-athletes curious about their schools’ policies, especially regarding specialized NIL uses such as NFT creation, various NIL-specific companies and resources have already begun to gain traction.[12]
Student-athletes have spent the last half year navigating new and murky waters, attempting to understand what exactly NIL contracting can provide them. College athletes generally lack the name recognition and social media branding that provide professional athletes both bargaining power and a gameplan for leveraging their worth on specific platforms. Sure, some college athletes this past year signed contracts worth five or six figures; a majority, however, made their first forays into marketing their NIL by collaborating with local businesses and restaurants, or featuring in one-off campaigns for some larger brands.[13] Even in those one-offs, athletes frequently did not receive enormous sums of cash, but rather, free products, gift cards, or smaller payments.[14]
Yet the future is bright for these athletes, as recent marketing trends have indicated an increased prevalence of, and reliance upon, micro-influencer campaigns.[15] These campaigns focus on marketing through niche influencers with dedicated fan bases that match the target audience for particular products.[16] Although these influencers are not household names, they possess the direct-to-market access and persuasive clout that marketing agencies have recognized as vital in recent years. Athletes and businesses have ample room to grow together in discovering just how mutually beneficial NIL contracts can become.
It has now been a year since EA announced the return of its beloved college football game series. A little over half a year since the NCAA adopted an interim rule allowing players to obtain compensation for use of their NIL. Half a year of yet-unsuccessful lobbying for a unified federal law granting student-athlete permissions to enter NIL contracts at schools residing in any state. And no solid news on any talks between EA and the NCAA on their potential futures together, or how EA may engage with specific players for use of their NILs. The question may no longer be one of if, but when or how these agreements are reached. 2022 holds promise to be an exciting year for college student-athletes and avid gamers everywhere.
[1] Brent Schrotenboer, EA Sports Re-ups on College Football After NCAA Snub, USA Today (July 19, 2013), https://www.usatoday.com/story/sports/ncaaf/2013/07/19/ea-sports-college-football-contract-renewed/2570119/.
[2] Kurt Streeter, NCAA Is Sued by Former Athletes, L.A. Times (July 22, 2009), https://www.latimes.com/archives/la-xpm-2009-jul-22-sp-videogames-lawsuit22-story.html.
[3] Steve Eder, E.A. Sports Settles Lawsuit with College Athletes, N.Y. Times (Sept. 26, 2013), https://www.nytimes.com/2013/09/27/sports/ncaafootball/ea-sports-wont-make-college-video-game-in-2014.html?_r=0.
[4] Associated Press, Conferences Ending Ties to E.A. Sports, N.Y. Times (Aug. 14, 2013), https://www.nytimes.com/2013/08/15/sports/ncaafootball/conferences-ending-ties-to-ea-sports.html.
[5] Austin Bumpus, EA Sports Is Bringing College Football Back on Next-Gen Consoles, Swing of Things Sports (Feb. 2, 2021), https://sotsports.com/2021/02/02/ea-sports-college-football/.
[6] Eddie Makuch, EA Is Reviving Its College Football Series for PS5 and Xbox Series X, But No Player Names or Likenesses, Gamespot.com (Feb. 2, 2021), https://www.gamespot.com/articles/ea-is-reviving-its-college-football-series-for-ps5-and-xbox-series-x-but-no-player-names-or-likenesses/1100-6487021/.
[7] Michelle Brutlag Hosick, NCAA Adopts Interim Name, Image and Likeness Policy, NCAA (June 30, 2021), https://www.ncaa.org/news/2021/6/30/ncaa-adopts-interim-name-image-and-likeness-policy.aspx.
[8] NCAA Name, Image, and Likeness Rule, Next College Student Athlete, https://www.ncsasports.org/name-image-likeness.
[9] Id.
[10] Id.
[11] Richard Davenport, The Recruiting Guy: NIL Deals Becoming More Absurd, WholeHogSports.com (Jan. 9, 2022), https://www.wholehogsports.com/news/2022/jan/09/nil-deals-becoming-absurd/#:~:text=While%20the%20student%2Dathletes%20have,athlete%20to%20attend%20a%20school.
[12] See, e.g. NIL Network, https://www.nilnetwork.com/institutions-and-nil-resources/.
[13] Dan Whateley, How College Athletes Are Getting Paid From Brand Sponsorships as NIL Marketing Takes Off, Business Insider (Dec. 30, 2021), https://www.businessinsider.com/how-college-athletes-are-getting-paid-from-nil-endorsement-deals-2021-12.
[14] Id.
[15] Dan Whateley, More Advertisers Plan to Hire ‘Micro Influencers’ for Campaigns, Business Insider (Mar. 12, 2020), https://www.businessinsider.com/micro-influencers-are-top-category-to-hire-marketer-survey-2020-3?r=student-athletes-lp.
[16] Id.