Good morning, and thanks for spending part of your day with Extra Points.

This is not the first time I’ve used this line, but that’s because it remains true. I’m not in the crystal ball business. I cannot tell you what is going to happen in the future, no matter how many FOIAs I file or people I text. If I could, friends, this newsletter would cost a lot more money than nine bucks a month.

Which is too bad, because we’re entering a particularly tumultuous time in college sports history. Of course, this publication launched during COVID, so this has basically always been the case, but the financial model that shapes how college sports currently operates is being challenged in the biggest way in 40 years, if not longer. Throw in an uh, unpredictable political environment, multiple legal challenges, institutional capital waiting to bite off chunks of the industry, and, oh yeah, a demographic and identity crisis in American higher education…

It sure would be nice if I had that crystal ball!

So I’m not going to make a bunch of predictions in this newsletter. But I think I’ve been writing about this world enough to have an okay idea of where some major storylines for next year may be.

Here are four storylines that I’m planning on paying particular attention to:

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Will a need to drive new revenue upend the MMR industry?

No, I’m not talking about Mumps, Measles and Rubella, although 2025 could very well be a big year for those guys too.

I’m talking about Multimedia Rights, or the bulk of advertising and marketing revenue that has nothing to do with broadcast rights. Think stuff like stadium signage, corporate sponsorships, radio rights, billboards, etc.

For the last several years, the most common model for schools was to partner with one of the larger MMR firms (like a Learfield, Playfly, JMI, Van Wagner, etc) to help sell those MMR assets. The university would typically get a chunk of guaranteed revenue, and then revenue beyond a particular point would be split between the school and the MMR firm.

That way, the school gets income predictability and the ability to work with larger profile brands thanks to a sense of scale.

That model can still work for many schools and companies, but it’s been facing headwinds for a while. The pandemic and declining ad spends in many industries pushed some MMR firms to end or renegotiate existing contracts. And now, every single school is trying to aggressively find more revenue in order to pay for revenue sharing and House settlement penalties.

My hunch is that there won’t be much more revenue to squeeze from typical broadcast rights agreements, and there are only so many more tickets you can sell. It will be easier for schools to find new money by expanding their potential MMR inventory (by selling stuff they haven’t before, like field sponsorships, jersey patches, new sponsorship categories, etc), taking their sponsorship sales in-house, or pushing for more favorable terms from existing partners.

Will the existing MMR companies find ways to successfully pivot to selling not just school intellectual property, but sponsorships that combine school and athlete IP? Will new sponsorship categories mature quickly enough to pay for some of these massive new expenses? Will new companies enter the MMR space? Will more schools take their operations in-house?

I don’t know! But there are only so many places where schools can drive new revenues. I suspect the world surrounding their licensing, sponsorships and IP will be where we’ll see a lot of innovation and change.

What are the other major political stories that will impact college sports?

The biggest political storylines have been written about a lot, on this publication and elsewhere, and I’m sure will remain critically important. The NCAA and major conferences want Congress to prevent athlete employment classification and to provide limited antitrust exemptions to allow the NCAA to enforce various NIL policies. Most athlete rights organizations, labor economists and antitrust scholars do not want this to happen.

Now that Trump is headed back to the White House, along with unified Republican control of Congress, it’s a lot more likely that the NCAA will be able to get the labor legislation passed that they’re hoping for. Congressional Republicans tend to be more sympathetic to the NCAA’s arguments about labor and control, after all.

But I’m not sure that athletic directors, university presidents, industry lawyers and the rest of the College Sports Industrial Complex is ready for how some of the Trump administration’s ambitious agenda may impact college sports in other ways.

To give some examples…conversations about what the National Labor Relations Board may think about whether Dartmouth Athletes should be classified as employees becomes moot if the Supreme Court rules the NLRB to be unconstitutional. Conversations about how the House settlement needs to comply with Title IX are going to look different if there’s no more Department of Education. The enrollment cliff in higher education will become more dramatic if immigration sweeps or visa restrictions curb international enrollment. A tariff-heavy trade policy is going to change the balance sheet for any athletic department that buys stuff made overseas (i.e. everybody). Campuses could very well be the center of other major protest movements, which could attract escalating reactions from the federal government. The list goes on and on.

I can’t begin to predict exactly what this administration is going to do in the next two years, or to what extent other institutional norms will be able to curtail those efforts. But I am pretty confident that there will be multiple moments in 2025 where higher education industry officials or labor activists are going to go, “wait, he can’t do that!”, but then he does. Most of those efforts won’t have college athletics in mind…but this is an industry that is mostly tied to public institutions. It can’t be completely insulated.

And on that note,

Who is actually going to run college sports?

I look at this question on two levels. For one, we have the question of what the NCAA is actually going to be, long-term. Virtually everybody I’ve talked to, from D-I ADs to D-IIIs, agrees that the current NCAA governance structure is too unwieldy, particularly in D-I. Pretending that UCLA and UC-Riverside are really competing in the same ecosystem is getting harder and harder to pull off, especially as the largest conferences openly pine for more championship access and power.

So they take their ball and go home? Do we get to the point where some low-major D-I programs begin to openly wonder if the chance at a 15-seed in the NCAA Tournament is worth the legal exposures and other hassles? There have been white papers and discussion groups floating around for years, but the talk of more meaningful breakaways is only going to get louder.

But beyond the NCAA, there’s also the question of whether college athletics governance and control begins to shift explicitly away from the traditional uneasy marriage of athletic departments and broadcast partners.

Multiple private equity and private capital groups have expressed interest in investing in college athletics. As labor and administrative costs are projected to significantly increase, the idea of securing a massive inclusion of capital and business talent could eventually become more attractive to schools. But there are massive political and operational hurdles to clear as well, and some partnerships that looked inevitable…aren’t.

My gut reaction for a while has been that the governance challenges make meaningful private equity investment in college sports pretty hard to pull off for both sides. But I also understand that I am not a finance guy. Trouble is, of course, neither are most athletic directors.

Hey, speaking of private equity, let me tell you about another Extra Points partner real quick, John Wall Street, who is hosting a huge pow-wow on the intersection of PE and college sports next month:

I’ll be there. I hope to see you there too!

Learn more here:

Finally,

Who decides to go on offense?

If you’re an athletic director or a coach right now, especially outside the P4, there’s an enormous amount of stuff that is completely outside your control. Your league wasn’t consulted in the House settlement. You have limited sway with broadcast partners. You have no idea what’s going to happen in Congress or with the various college sports cases moving through federal court. The list goes on.

On some level, I wonder how many constituents in college sports decide, screw it, if we’re going down, let’s at least have that happen on our own terms and start swinging.

We could see that in conference realignment, with one-bid leagues launching preemptive membership strikes on peer conferences, or in being willing to dramatically change how they operate, in an attempt to regain some control, like the WAC a few years ago.

We could see this with individual sports, who might look at post-NCAA governance options, or even more aggressive federal lobbying. We could see this with individual schools, who decide to sue the proverbial big boys and hope for the best. I think we could even see it in the marketplace, as many of the entrenched firms in various subcomponents of college sports (travel, ticketing, software, consulting, etc) could face more aggressive competition than ever before.

We’re already hearing about some Olympic sports getting into the lobbying waters. Will that continue? Will new coaches, trade groups or other organizations emerge to try and counterbalance the NCAA and/or P4 football?

Sometimes going on an offensive doesn’t work out. But when you get desperate enough, maybe more groups will decide it’s worth a shot.

What about you? What are the big industry storylines that you’re most focused on this year? What have I missed? Let me know in the comments, my inbox, or social media mentions.

It’s been a big week. I’m going to try and get a little rest before we finish this month off strong. We’ve got Office Hours next week and a full week of newsletters before I take a little holiday break.

Thanks for reading. I’ll see you on the internet next week.