Assistant Sports Editor Hunter Nelson: Hello, everyone, and welcome to episode three of Hark the Pod. I am Hunter Nelson, the assistant sports editor at the daily Tar Heel. I am joined by a special guest today, one of our writers on the sports desk, Rithvik Chelasani. Rithvik, take a moment to introduce yourself.
RC: Hey guys, I'm Rithvik. I'm a staff writer at the DTH, and I just got done doing an article on Sam Howell's new NIL deal with Super Glow Trading Card Company.
HN: Well, that's perfect because I was just going to get right into what we were going to talk about, so that was a nice little tease there. But the premise of today's episode is about NIL, which came into place this summer. College athletes for the first time ever can profit off their names, image and likenesses. They can make money off that, they can sign autographs, the whole nine yards. But the one thing that became prominent recently is Sam Howell actually signed a deal with a trading card company to produce his own sort of football cards that can be, I guess, pretty valuable down the line when you really think about it. So, what are your general thoughts about that?
RC: Yeah, sure. So, this deal is different from a lot of previous deals, mostly because of the royalty side that's involved. So, Sam Howell, along with JT Daniels, the Georgia quarterback, will be paid one hundred dollars for every card that they're going to sign, and they will also be receiving 50 percent royalties on every card that they signed that’s sold. And this is a departure from the traditional NIL deals, I guess you can say, even though it's only been around for three months, in that most of the time it's been athletes will show up for sponsored events or they'll do ads and then they'll get paid for those ads. They don't really have much and they don't have much to gain based on the amount of sales that happen. The athletes don't really have much of a stake in the amount of sales that are made, which is where Sam Howell's deal differs from previous ones.
HN: Yeah, no, and I think that's a great point, just the fact that how we'll be able to receive these funds years and years down the line, even beyond his days at North Carolina with those royalty agreements. And the premise of the card design is actually pretty cool, I know each player gets two dozen designs, so a lot of variety there. But you said there's a certain strategy that the agent is sort of producing that can really maximize the most of Howell's long-term growth. And I think that's just a perfect fit for the boom in trading cards moving past the pandemic and all that.
RC: Yeah, absolutely. So, Howell’s agent from the moment that now started him and how his team have come with the strategy of wanting to maximize how will security make as much money as possible while in college, while also creating the opportunity for future growth? So, all of Howell's NIL deals have been structured to be one year long. They will go on until the end of his junior year, and they also have the option of extending that deal once Howell gets drafted. And this was designed with the express intent of maximizing his star power right now in college, while not holding him back from increasing the amount that he earns once he goes into the league.
HN: I think Howell is in a unique position, too, because as the quarterback of the team, as one of the faces of the ACC and just college football in general, he's in that position to sort of put himself out there to receive all these endorsements. But what are some ways you've been able to see him sort of connect with his teammates and get them deals as well?
RC: Yeah, sure. So again, every single one of Howell's deals has been structured with either a philanthropic side in mind or to help out his teammates. So, we've seen that with recently S.O.S Roofing. There were six of his teammates were in that commercial that was shot for S.O.S Roofing, and all of them got shares in the revenue from that deal. And as well as every deal that howl signs towards the end, he tends to cut back on his maximum earnings and redistribute that to his teammates to also help give back to the people that make him as successful as he is.
HN: But I just wanted to now get into the whole NIL discussion as a whole. So, for so many years, the concept of amateurism limited the, I guess, long term growth of NIL and its feasibility. But now you're seeing some players, I know even Quinn Ewers at Ohio State is actually a high school senior, but he enrolled at Ohio State early so he can make 1.4 million just right out of high school. So, what is your just general take on the NHL and its growth and how it's changing the college landscape?
RC: This is the turning point in a decades long battle that's happened to try and get college athletes paid for the entertainment that they provide for the country, as well as the revenue they bring into their colleges. When NIL was announced back in July, no one really kind of knew what to do with it. And we're seeing right now how different universities are adapting to the rules because there's very few guidelines at the moment. Different schools are using now in different ways. If you go to, say, BYU, they're offering scholarships for walk-on players. You've seen schools like UNC, for example, they've started implementing revenue sharing programs between their athletes, as well as giving them the option to get money from third parties for sales of UNC gear wearing with their names on it. And as NIL continues expanding, it will probably begin to be regulated more. But at the moment, we're in the Wild West. Pretty much anything goes, and we're also seeing, as a result, these massive deals like Quinn Ewers, who's still a senior in high school, getting over a million dollars, which is crazy and something that most people didn't think was possible. I will say, Quinn Ewers is a special case. He is one of the most highly rated prospects that's ever come out of high school. Don't expect to see this from almost any other athlete in the future, because also you have to look at from the brands perspective, it's an incredibly high risk going after high school athletes and you will most definitely not see many deals over four or five figures.
HN: And if anything about Ewers, as you mentioned, this dude has not played one snap in college, and he's already making 1.4 million dollars from an NIL deal. So that just really solidifies the Wild West ideology that you were talking about. Even Howell with this trading card agreement, they said this alone will get six figures, potentially seven, depending on how he turns out this season. It's looking good thus far, but it's expanded in other sports as well. I know Erin Matson the UNC field hockey player has her own shirt at local sportswear stores. She's done autographs, endorsements and I think it's really going to keep expanding and going into other sports as well. And who knows? I don't know if there's going to be any guidelines to sort of curb this in the near future, but only time will tell. We just have to wait and see and go from there.
So, I guess just the last question I want to ask is what is your general prediction for what NIL deals will look like maybe 10, 15 years down the line? Will they be more regulated? Will they allow athletes to make even more money than they're making now? What do you think?
To get the day's news and headlines in your inbox each morning, sign up for our email newsletters.
RC: So, I think that it will be regulated eventually. The NCAA will want to tamp down on a large amount of spending for athletes. Obviously, we've kind of opened the floodgates and no one really knows what to expect. This will also play a huge part in recruiting, in my opinion, because now we're looking at schools might be able to offer full scholarships to pretty much every athlete on their rosters due to NIL deals, whereas before they would have to budget how they handed out their scholarships to different athletes. But this also has the potential to even out the playing field a lot in college athletics. Where before you see football and basketball especially are dominated by large state schools, you might see smaller schools starting to compete. And overall, I think that this is going to have a positive impact on college athletics, if only because college athletes will finally be able to make money for the revenue that they bring to schools, not just in football and basketball, the big sports, but as you said, Erin Matson in field hockey. And we're also seeing attention being drawn to other sports, such as baseball or softball that aren't traditionally big on TV or covered by the media a lot.
HN: And I think that's a tremendous point. I just wanted to sort of expand on your thought process there, because just to play devil's advocate, there's going to be some people that say, ‘Oh, well, these big schools are going to hoard all the recruits coming out of high school because they're going to have the most opportunities for potential growth.’ In what ways do you think the smaller schools and smaller programs will be able to level the playing field and bring in top talent from high schools?
RC: Yeah, sure. So, going through the athlete’s perspective, let's say you're a five-star football player that is probably going to get into the league. So, now you're looking at what school do I want to go to. And the reason a lot of them are going to Alabama right now is obviously the opportunity to win a national championship. But also, they get a lot of attention in the media, which also increases their possibility of getting drafted. Whereas now that NIL is in place, athletes can also make money while they're in college. That is going to provide them with a security blanket almost where they could go to college for a smaller school and still keep a very high draft profile and then go into the NFL without having to worry about hurting their future prospects.
HN: So, I think that is a very interesting point that you bring up there. And who knows, it's a crazy time that we're going through right now, and only time will tell where it's going to go from here. But we'll just have to sit back and see where it takes us.
HN: So, thank you so much for joining us today. This was Hunter Nelson with Rithvik Chelasani. He wrote a tremendous piece about this just a week ago. Be sure to go to The Daily Tar Heel to check it out and we'll see you next time. Thank you so much for joining us.
RC: Thank you.
This episode was produced by Levi Pitts. Supervising producers were Audio Editor Leo Culp, Multimedia Managing Editor Alex Berenfeld and Editor-in-Chief Praveena Somasundaram.