ESPN article: NIL with limited information about the value at certain schools
The following article was posted on ESPN's web site. The headline is: "Alabama Crimson Tide among schools to not disclose NIL data." This is the link to the full article - it is not paywalled.
There was no information about Michigan and its NIL program.
A couple of perspectives. First, Jimbo Fisher said A&M would be "transparent" about NIL deals. A&M provided some information. Specifically, 490 NIL deals / contracts have been signed, with a total value of $ 4.2M. This means the "average" deal / contract value is about $ 8,600. The $ 4.2M figure is for ALL sports at A&M with football accounting for 81% of the NIL monies.
Questions being asked are: A) Who has an NIL deal with whom? and B) How much are the individual NIL deals worth? There were no answers, and - this will be, IMO, a privacy issue. The only way anyone will know about the value of any single, or player aggregate, NIL monies is if the player and / or party contracting with the player will disclose that information.
The NIL landscape will continue to evolve.
October 7th, 2022 at 12:42 PM ^
This is one of the things that will change if the schools start paying players directly (above the table). Those players will be public employees and will have to divulge their earnings.
October 7th, 2022 at 1:09 PM ^
Unless you're Stanford. Or Notre Dame. Or Northwestern. Etc...
October 7th, 2022 at 1:25 PM ^
Duke
October 7th, 2022 at 2:36 PM ^
It wouldn't be hard to figure out how much they are getting paid. Up the pay of your athletes and when they transfer out of ND or start flipping from ND to Michigan, you know how much they were being paid. .
October 7th, 2022 at 4:41 PM ^
Hey, watch the language. This is a family blog.
October 7th, 2022 at 10:17 PM ^
I'm sure it can be set up so the kids aren't getting paid directly by the university. I doubt it would ever be arranged as such. There'll be a Friends of Michigan LLC or something that it will be run through.
October 7th, 2022 at 12:51 PM ^
Given the way U of M handles FOIA requests I'd assume Michigan wasn't one of the 20 schools they requested info from or they'd be in the 'didn't respond' list as well.
Tough call on the whole. From a prospective signee's point of view you'd want that info to know if you're getting fair value, but once someone offers you a deal I can see why you wouldn't want the University disclosing to your teammates or fans exactly what you're getting paid.
October 7th, 2022 at 1:05 PM ^
I do think some of the talk around NIL deals was a bit of puffery; even rich boosters are not going to drop guaranteed millions on HS kids. It's similar to the Mel Tucker deal where we kept hearing "oh yeah, these rich boosters are paying for it all" and then when anyone wants to see the terms of the contract (which as a public employee at public university you'd expect would be made available) MSU balks. Rich people don't stay rich by being fast-and-loose with their money, and so while I'm sure A&M kids have gotten more money that the $8600 average listed here, I do think we're going to start seeing some of the hyperbole get turned down around these deals as everyone settles down and the bullshit meters get turned up a bit.
October 7th, 2022 at 1:49 PM ^
Bronx, I might not have been very clear about the contracts. The average value of a contract is just under $ 8,600. However, Texas A&M stated there are 490 contracts.
I see no reason why a single student athlete couldn't have a number of contracts / deal where they provide NIL services / endorsements. So, if you're a prominent student athlete, there are two aspects to this: first, the average amount of your contract(s) could be higher, and second, you could have a number of contracts.
If you're a "more visible" NIL player - you might have 15 contracts with an average of $ 20K. So, that's $ 300K. And, if this is an annual figure, over four years, that's $ 1.2M
The only entities that really know are: 1) student athlete, 2) their NIL sponsors, 3) their tax preparer, and 4) Departments of Treasury - both Federal and State.
October 7th, 2022 at 1:50 PM ^
What you wrote makes sense, including that rich people don't stay rich by being loose with their money,
But the really rich have enough that they're happy to spend a million $ here or there to enjoy their hobbies.
October 7th, 2022 at 2:09 PM ^
One different perspective...
Rich people love showing the influence and importance they (and their money) have.
When I lived in Texas I had a friend of a friend situation which gained me access to the Longhorn club at UT during football games. Most of the game was spent listening to these rich white guys talk about the hundreds of thousands of dollars they had spent "to get" this guy and that guy and how they were performing that day. I have no doubt the amounts were legit and not exaggerated because...I had another friend who was Mack Brown's neighbor and would often hear about how much of a pain "so and so" was with their "$xyz dollars".
The amount of money flowing through, in, and around, college sports, especially football in the south, is very real and will be available for a long time. In some ways, sports is like religion. It's not always logical why you believe, but you believe, and because of this, you are committed...for the long haul. The people who have money to throw around will continue to do so as long as it strokes their ego. The only thing which will temporarily change that is if they don't like the current coach.
If you don't believe that is true, let me tell you about my friend who went to church with Charlie Strong.
October 7th, 2022 at 3:04 PM ^
Go on...
October 7th, 2022 at 1:10 PM ^
Are NIL deals supposed to be public knowledge? It's an agreement between a player and a company/entity. Nobody is entitled to that information.
October 7th, 2022 at 1:23 PM ^
I think you're largely correct because typically FOIA requests relate to school employees and their communications/documentation in a capacity as an employee, not their personal lives. AFAIK these athletes aren't considered employees and their 3rd-party deals are just that. Now, that may be subject to change. I'm also not sure how it applies to those situations where a university-affiliated wing helps negotiate the deals if those communications are accessible.
October 7th, 2022 at 1:24 PM ^
If I were an IRS auditor I think I’d be very interested
October 7th, 2022 at 1:31 PM ^
Gifts are not taxable to the recipient. Not considered income.
An individual giver is supposed to report any gift of over $16k to a person in a year on a Gift Tax Return, but still not taxed on it unless/until their total giving in their lifetime exceeds a ridiculous amount.
October 7th, 2022 at 1:40 PM ^
But these agreements are not gifts, they are business contract agreements
October 7th, 2022 at 1:45 PM ^
Gifts are not allowed by NCAA though.
oh wait. I see who I’m talking to.
October 7th, 2022 at 1:33 PM ^
Separate issue entirely. Nobody is entitled to know what you make except you, your accountant, and the IRS. This has nothing to do with that.
October 7th, 2022 at 1:47 PM ^
Readyourguard,
spot on. And discussing money is one of the last big taboos in our society. It’s not easy to have honest conversations about in almost any environment.
October 7th, 2022 at 2:20 PM ^
NIL deals do not have to be public knowledge.
I believe some states (or maybe the specific schools) have rules where NIL deals are supposed to be reported to the school to insure there is not a conflict of interest. I.e. Michigan is providing a scholarship to an athlete and has a right to revoke that scholarship if an athlete appears in an ad for a strip club.
That means the school has the data, but would not be legally required to make it public because it is private information of the athlete held by the school for a business purpose. No different than a publicly held company holding someone's credit card info to conduct a transaction. That info has to be secure and is not subject to public request.
October 7th, 2022 at 1:12 PM ^
Doing some simple math, 81% of $4.2M is about $3.4M. Assuming 85 scholarship players (which is a big assumption due to COVID), it works out to an average of ~$40K per NIL football deal at Texas A&M, for those curious.
Now I'd be really curious to see the median NIL values per sport.
October 7th, 2022 at 1:26 PM ^
I would think 90/10 rule of thumb in that 90% of NIL money goes to the top 10% of players.
October 7th, 2022 at 1:32 PM ^
EDIT: responded to wrong person.
October 7th, 2022 at 1:36 PM ^
To me, the interesting thing about NIL as opposed to player contracts in the NFL is that the most marketable 10% isn't the most valuable/least replaceable 10%. You can get a good sense of NFL player value by salary. But at the moment, I do not believe NIL deals do the same. Looking on Valiant's M-Den page, I see a book for the OL - which is cool - but I'm guessing the receiver's selling jerseys are making more from NIL.
October 7th, 2022 at 2:21 PM ^
This is where my brain was going. What is the distribution model for this? You hear crazy numbers for players which may or may not be true. If they are true, then the reality is that 90% is going to a single person and 10% is spread elsewhere. It also raises the question of how much we don't know about. McCarthy did some great things for charity and his teammates this year. If the average is 40k let's say, he's not keeping much for himself. Or there's other unreported deals that make this even scarier.
October 7th, 2022 at 1:30 PM ^
80% of $4.2M is $3.36M, and split 85 ways the deal averages out to $39,529 per player (of the many obvious caveats, not all players are equal and on offense ball-handlers are more marketable than hog-mollies, even if the hog-mollies have higher replacement value, likewise offensive players typically are more marketable than defensive players excepting the defensive MVP maybe).
For comparison's sake, the CFL salaries range from $60k to $100k, the XFL is at $59k + housing and board (which college athletes also get). I think CFB is a more consistent feeder to the NFL than other minor leagues, and arguably the coaching and development is better. But also, for the high level SEC and Big Ten programs, $4.2M is a drop in the bucket for many of the boosters, and even for the AD revenues (which is not where this money comes from, for now).
I'm certainly no expert. The average as calculated is very crude. My gut feel isn't worth a damn. So accepting all those valid caveats, my damnless gut feel is that there is a lot more room for CFB's compensation to grow.
Thanks for sharing. Good read,
October 7th, 2022 at 1:51 PM ^
More of the Knights who say NI + the Likeness Monster.
October 7th, 2022 at 2:36 PM ^
I can see some of these kids having some major tax issues down the road.
October 7th, 2022 at 5:09 PM ^
Rhino,
Exactly. Are these student athletes employees who will receive a W-2, or contractors / consultants who will receive a 1099? The difference is significant.
And, of course, if they receive certain things - "in kind" - like, let's say a Mercedes AMG G500. If a vehicle is the student athlete's to use, and that is their compensation - it would seem there's depreciation on the vehicle and some tax implications.
October 7th, 2022 at 10:20 PM ^
Aw hell, Cletus. Sure was a lot more easier when we could just give these chilluns a wad a cash! Who never heard of no contracts or disco-sures or nothin. This nil nonsense is fer the birds.