Transcript – Name, Image, and Likeness (NIL)

Magen Mintchev  00:19 Veritone presents adventures in AI the podcast that dives into the many ways artificial intelligence is shaping our future for the better. I'm your host, Magen Mintchev. And today we're going to be talking with Craig Caruso, Veritone, Senior Director of advertising and partnerships. And Ian Retzlaff, Veritone, Senior Director of Sports licensing and partnerships, we are going to be talking about navigating name, image likeness, or an AI l opportunities, our involvement and how it will continue to evolve. And, of course, more on that topic. So welcome, gentlemen. And thank you for joining me. So I gotta be honest, when I first heard about NIL or name, image and likeness, I had no idea what it was about. And I still don't know a lot, which is a big reason why you're here today to educate me and of course, our audience. So before we get started, why don't you each introduce yourselves? And then what it is that you do and then tell us more about NIL what it is. Craig Caruso  01:23 So a bit of background about myself, Senior Director of advertising and licensing here at Veritone. Veritone serves as the digital video archive, asset management and licensing agent for a number of marquee, collegiate and professional sports properties are a high value, high touch creative service for brands, agencies, production houses and linear networks. So on my side of the house, we're working on you know, your major campaigns, everything from broadcast down to digital, the business tends to be very event centric. So think March Madness, Masters golf tournament, US Open, etc. We often work with partners on activating around those very tentpole moments. Ian Retzlaff  02:01 So as a Senior Director of Sports, licensing and partnerships, working very closely with our sporting partners and kind of their roster of rights that they represent to ensure that everything's aboveboard to work on a ton of editorial content use from short form digital highlights that you consume on your phone across social need media, original scripted productions, things like ESPN 30, for 30 productions that you see on Netflix, etc, we play a huge role in sort of a creative partner, and serving up valuable content as far as enriches those storylines and narratives. So again, it kind of is a holistic ecosystem here at Veritone, where we're managing all that content that we're able to license distributed, monetize that on behalf of our sporting partners. Magen Mintchev  02:47 And who wants to take the first stab at explaining more of what NIL is? Craig Caruso  02:53 In terms of you know, what an NIL is, it stands for name, image and likeness. So I think in light of recent 2021 court rulings and the subsequent NCAA suspension of their bylaw of support for NIL has exploded. So effectively, this means this now means that student athletes can now profit off their own personal brand and likeness. Regulations on a state-by-state basis vary, but you know, in terms of what's not permissible on a school, by school level of our compliance departments are now forced to play a huge role within the within this ecosystem in college athletics, in terms of tracking, reporting, and broader regulation. Ian Retzlaff  03:33 So to piggyback off of that, I mean, it's everything from traditional items like Jersey sales, right, monetizing your name, you know, on the back of a jersey, your number, etc, for so many student athletes are just synonymous, you know, kind of with that uniform, you know, and prior to the suspension of this bylaw, you know, students couldn't even do that, right, it wasn't an opportunity for them to receive royalties. Similarly, I think going forward, you're gonna see, you know, everybody talks about kind of the landscape of gaming with EA Sports and releasing, you know, college football, college basketball games, etc, you're going to see an opportunity, I think, for student athletes to have a say in, you know, whether it's individual negotiation around kind of their personal IP or rights or even collective bargaining at a school, or even potentially, you know, either a conference or sort of nationwide level, I think it's fairly open ended in terms of how this is going to look going forward, which is what makes it so exciting. Magen Mintchev  04:27 Yeah. And such a game changer with a lot of these collegiate athletes. So I if I were an athlete, especially in college, I would be loving this right now. Ian Retzlaff  04:36 Yeah, and I was gonna say, I think that, you know, to kind of piggyback off that comment, you see, now it's in the news everywhere every single day. Kids are transferring from school to school. I think this is a huge concern based on the existing landscape around kind of the pay for play model. I don't know that the spirit of this program was necessarily designed for, you know, student athlete to be paid, whether it's 100,000 dollars or a million dollars or more, just go play for a particular school, I think, you know, the spirit of the, you know, NFL, you know, has maybe eroded a little bit over the past six months. And again, I think, you know, here at baritone we're all for, I think very supportive for our partners of student athletes pm on monetize their likeness. But you've seen sort of these fringe use cases where, you know, cartoon athletes are transferring just, you know, protected in a potential pay for play setup, which I think has some potential ramifications and concerns for, you know, collegiate athletics. Magen Mintchev  05:32 Yeah. So there are a ton and PAC 12 pioneered the NFL program, can you first of all, identify what PAC 12 is, for those of you in the audience who might not know and share why we pioneered that program with them? Ian Retzlaff  05:46 Pac 12 Is the Pacific 12 conference, it's your West Coast centric schools, you're talking, you know, Oregon, USC, UCLA, my Colorado Buffaloes, etc. But effectively, the program here, I think what's so compelling about this is you think about an IUL. You know, it's, it's effectively a, you know, 18, 19, 20-year-old, you know, female Male Student Athlete all the way from gymnastics to I mean, you name it, even rowing, right, all the way up to college football, is sort of managing their own personal brand. So basically, the whole spirit of this program is kind of built around sort of three use cases, or three tears, if you will. So kind of the first kind of the first layer to this. And again, PAC-12 has been a fantastic and highly progressive partner in this regard, is sort of student athletes leveraging authentic game content to sort of build out their own digital social media presence, right. So they want to, you know, gain, then this goes off the air at 6pm, they want to post content on their, their social channels, from that game, just to kind of build out again, their own personal brand personal profile. Pac 12 is very supportive of that. And there's some limitations around how much content can be used, etc. That's kind of the first use case, right is kind of personal use, non-sponsored, non-branded, but really, I think, you know, sort of elevating the brand of the student athletes, and kind of the second piece, which I'll speak to here, and then I'll kick it over to Craig for the third piece is sponsored highlights with a paid partnership. So this is an opportunity, you know, you may go on social media, whether it's Twitter, Instagram, etc, you may see a piece of content and has a paid partner at the top, or potentially, there's a tagged paid partner in the comment section, right. So there may be a game highlight, it may be attached, you know, this is a paid partnership with Brand X, Y, or Z. So in this scenario, and I want to make it clear, kind of the the program that we pioneered is we're never asking student athletes to you know, or requiring them to foot the bill for any licensing costs, right, it's the responsibility of the associated brand partner to to effectively sort of manage the rights and licensing of that content, by which they're receiving incremental or additive value by attaching that paid partnership or that brand partnership. So again, the spirit of that is, you know, it's on that student athlete, social handles some so student athletes these days have a million followers, 3 million followers, it's crazy. Um, but again, you know, that's kind of the second layer is that paid social posts, you know, it's more of an editorial angle, but there is sort of an ancillary paid partnership. And then the third angle is more of a traditional pure advertising use case, which I like Craig speak to. Craig Caruso  08:30 The third use case here is pure commercial use. So think of, you know, an advertisement, vlog testimonial, etc. I think, you know, in this example, university approval is required, in addition to, of course, the athletes approval. But I think, you know, maybe an important thing to note here in general, is that these are video assets that are copyrighted by the conference. So the reason why this this program is so noteworthy, and you know, such a huge, huge momentum builder is that the PAC 12 is the first to the table, right. So no other collegiate properties endorse such a program that provide this level of access to conference owned assets. So it's absolutely huge for all those athletes within those programs, universities that Ian mentioned, and it does provide them the opportunity to capitalize on their likenesses, you know, during the time when they're most active, and that's when they're playing in school. Right. So, you know, I think as we look at potential, you know, criticisms and benefits of of NFL, I think the point there is very sound and that the window of opportunity for these athletes are often small, particularly for those who may be involved in some of the Olympic sports like gymnastics or wrestling. So again, you know, because the PAC 12 has endorsed the usage of current year material. Those athletes can in turn, you know, capitalize on, and maximize their window of opportunity again, while they're playing while they're in the peak of their sport, I think is thus far, you know, to date we've seen the most brands centric activations leveraging content of female gymnasts, which is fantastic. And I think we've seen, you know, that usage continuing to trend up in the coming year. Ian Retzlaff  10:10 I think it's certainly a very interesting time. But there's also some challenges too, right? I mean, you've got an 18-year-old who's managing, you know, their own personal brand, right? I think back to being a, you know, an 18-year-old kid, you know, being a student is tough enough, let alone being a student athlete level on being a student athlete with your own, you know, entrepreneurial spirit or business, right. Yeah. So, you know, you're just going to have to, you know, a lot of these kids, I imagine, it's just a super full plate, you know, and we're talking about content and copyright and some of these nuances. There's just a lot of layers to that. So I think that's, that's another important aspect is, you're trying to work with our partners at the PAC 12. And in association, their member schools, just around education of the program, the policies, etc. Magen Mintchev  11:00 Are there some athletes that just don't even take advantage of this at all? Because of that, what you just mentioned? Because it's a full plate? Ian Retzlaff  11:10 I think there's bandwidth is an issue. Um, you know, and also to, you know, certain student athletes, I think, are just going to be savvier, certainly than others in terms of managing their brand. Right, it's really running your own business. Yeah, no. And, you know, I would say to, you know, how big of a priority is it for certain folks, as opposed to others, you know, certain student athletes may be heavily inclined to maximize this window of opportunity. Whereas others, it may be a little bit more of a passive initiative. Right. So, so I would say, again, you know, this whole world is so new, and there are, you know, nuances around kind of navigating this, but I would say, Magen, you're right, there is a bit of a, you know, there's a there's a gap, and there's an opportunity for I think athletes to student athletes to jump on board here. Craig Caruso  11:58 Yeah, I think to build on that a little bit. You know, I think we've seen some, some major representation agencies become involved with, you know, current student athletes, which has never been done before to this point. So I think, from their perspective, of course, there, they can provide a great deal of help and assistance to those athletes, but perhaps it, you know, provides long term benefit for both sides. So, I think, again, we'll see more and more, and that we're in the very early innings of this, just given this is kind of very topical, and recent and midpoint of 2021. So, you know, as we go forward here, and, you know, throughout 2022, I can see this, you know, exploding. Magen Mintchev  12:35 Yeah, agreed. So, being an artificial intelligence podcast, what is the AI tie in here? Ian Retzlaff  12:44 Yeah, I think as we look at this opportunity, right, it's, the scale is huge, you think about just the amount of content that's being created from all men's and women's sports, you know, from the top down, you know, and how you make that content effectively, you know, searchable, pre viewable downloadable, have smart metadata that's being tagged and applied against it. So that way, it can be easily grabbed for sort of quick turn use and consumption, I mentioned those couple use cases, you know, sponsored highlight posts, they're most timely and relevant immediately after a game. So, you know, I think as we look at this long term, you know, the ability to apply, you know, some cognitive engines against that content, you know, smart tagging specific player names, actions, keywords, you know, envisioning again, that scenario where a game goes off here at 6pm, you know, potentially a student can log on to, you know, a Veritone portal and grab content from that game, you know, within, you know, even call it 24 hours, right, whatever it may be, I think that's kind of the long term goal here leveraging artificial intelligence. Craig Caruso  13:53 Yeah, definitely. And I would just add, you know, to your point, I think those cognitive engines can be, you know, incredibly valuable here, just based on, you know, to your point, the level of volume in which these games are played, you think about the quantity, per sport per game per year, but think of the number of athletes as well, right? If you have, you know, hundreds, if not 1000s of athletes in total, across the country, and probably much more, you can see how there's a scalable opportunity and very, very high level of relevance for AI being applicable to this type of use case, Magen Mintchev  14:25 Craig, little bit ago, you had mentioned the future. So looking toward the future is NIL here to stay? And if so, how will it continue to evolve? Craig Caruso  14:37 Yeah, I think so. So, you know, it's difficult to kind of put the cat back in the bag at this moment in time. I think the rules are forever changed at this point. I think, as we've discussed here, you know, we can see kind of some regulation and guidelines policies, maybe from the NCAA level, but also just within individual universities of what can and can't be done. But I think, you know, a good example of where we see the future, you know, Moving is just NFT's right? So a quick definition for NFT's for folks who may not be familiar. Talking about digital tokens digital assets that can be traded right traded exchange for cryptocurrency or traded for other assets, of course, all electronically. So I think parlaying into that Veritone is actually partnered with RECUR to mint the first collegiate sports centric video and fts. I know that is a lot to say in one sentence, but effectively think of all this this wonderful PAC 12 game and match material and turning that stuff into NFT's. So, you know, at some point in the future, we can envision NFT's being minted with current student athletes. So effectively think student athletes being paid for their appearances in those digital tokens, serves as a passive and reoccurring income source for those student athletes where they receive a check in the mail for their, you know, then being featured in the NFT. So you can see that there's a fantastic opportunity there. That certainly had not been the case in the past. Ian Retzlaff  16:03 We talked about just the burden of personal brand, you see this as a really scalable, sort of long term revenue stream for student athletes of all sports in all genders. Right. And so I think there's a ton of excitement and a ton of runway there. And that's just one area where I think, you know, again, you're gonna see a ton of growth here in the next three to five years. Magen Mintchev  16:26 Yeah, absolutely. Lots of ways to monetize, way different than when I was in college, many moons ago. So in three to five bullets, how would you summarize what we've been discussing today? Ian Retzlaff  16:41 What you see from state to state school, the school right now, there's, you know, no, top down governmental or, or, you know, regulatory legislation, it's very much the Wild West, you know, I think, to sort of maintain the spirit and the integrity of where this, you know, where this program sort of originated, I do think there needs to be some uniform policy, you know, around sort of, you know, what, you know, what student athletes can activate against, in what ways, you know, and how they can be compensated, you know, again, very much pro athletes being compensated for their name, image and likeness, but having some, you know, guardrails there to just maintain the integrity of the program, I think is going to be important. You know, and again, I think the PAC 12 program is fantastic. We're really happy to get that off the ground. We expect other conferences to follow suit here in the near future, you're gonna see, you know, more and more content that's copyrighted and controlled by all of these sort of Power Five group of five conferences, follow suit, and then Craig, I'll kind of let you jump in here and take a couple of us. Craig Caruso  17:49 Yeah, I think the tide off from an AI perspective, you know, we're excited about that, you know, potential to leverage some of those capabilities and engines against this content. I think there's high potential for that in the future just to provide better enhanced preview searching and downloading, no doubt that'll be valuable in the future. And then just as we discussed a moment ago, NF T's non fungible tokens aren't going anywhere. I think you can see that space fluctuate a bit, but I think the passive revenue stream for current student athletes is going to be very compelling over the next few years. Magen Mintchev  18:20 If people want to learn more about this topic, where can we send them? Ian Retzlaff  18:24 Yeah, so you can feel free to shoot us a note at [email protected]. I mean, again, we're gonna stay very active. You know, on this topic, we'll continue to publish it, whether it's a press release around any news with Rucker as it pertains to any of our other partners. So I would just say stay active on, you know, Veritone social and corporate channels, because again, this is a very hot topic that's not going away. Magen Mintchev  18:47 Thank you for giving that little plug Veritone social I appreciate it being the senior manager for social media and brand management here at Veritone. So this is an awesome disgusting discussion, Craig and Ian, I am extremely grateful for your time and providing not only me but our audience with all the information about NL I appreciate that I've learned something new today. So thank you and thank you to everyone out there for listening to adventures in AI the podcast that dives into many ways artificial intelligence is shaping the future for the better talk with you next time. Subscribe