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National teams get the cold shoulder

Chad Hedrick is one of several American speedskaters to break away from the national team in order to sign individual sponsorship deals to make more money than otherwise possible.Matt Dunham / AP
/ Source: Forbes

Chad Hedrick doesn't speed skate for the money — but he's not passing the hat for pennies. With a Dutch bank, DSB, as his sponsor, the American speed skater makes over $100,000 a year, more than he ever earned racing on wheels as a world champion in-line skater.

Top speed skaters are gaining attention from corporate sponsors, partly because of high-profile athletes like Hedrick, who signed his endorsement deal before he'd ever competed on ice, and Shani Davis, the first African-American on the Olympic speed-skating team. But their commercial appeal has caused conflicts with the U.S. team, which has traditionally exercised substantial financial control over its athletes.

U.S. Olympic teams — called national governing bodies, or NGBs — pay for travel and training expenses but limit the endorsements that athletes can accept. As the games have become more commercial, prominent athletes can sometimes earn more money on their own. That creates problems for the teams, who then have fewer top Olympians to lure corporate sponsors.

Because of an endorsement dispute, Hedrick and Davis, along with fellow Americans Derek Parra and Chris Witty, have split from U.S. Speedskating. They sign their own sponsors, pay their own expenses and work with their own coaches and trainers.

Of course, not all Olympians have such welcome problems. (See: "Scraping By.") But the speed skaters aren’t the only Olympians pulling in significant endorsement dollars. And they aren’t the only ones having conflicts with their national teams, either. Six snowboarders have set up their own team, the Collection, to avoid the sponsorship rules of their NGB, the U.S. Ski and Snowboard Association. The USSA doesn't allow companies that compete with those sponsoring the team to endorse individual athletes. Members of the Collection, by contrast, vote on their team's endorsers, so the athletes have control.

"It was a good business opportunity for us," says snowboarder Gretchen Bleiler, who started the Collection along with Ross Powers, Kelly Clark and Andy Finch.

Two other champion boarders, Mason Aguirre and Luke Mitrani, joined later. The team is endorsed by Snickers, Nickelodeon and Yamaha, and the six members can retain their own sponsors as well.

John Collins, an attorney who works with Olympic athletes, says he's been involved with similar disputes in soccer, track, beach volleyball and figure skating. The conflicts take different forms in different sports. Figure skaters, for example, don't sell sponsorship spots on their outfits. But they do sometimes fight for the right to skate in so-called non-sanctioned events, such as Smucker's Stars on Ice, a figure-skating theater show founded by gold medalist Scott Hamilton.

Endorsements didn't cause this much conflict 30 years ago, because even the best Olympic athletes couldn't attract as much sponsorship money as they do today. This changed during the tenure of Juan Antonio Samaranch, president of the International Olympic Committee from 1980 to 2001. During that time, the rules were changed to allow professional athletes — like American basketball stars — to compete in the games.

"Samaranch didn't want the best amateur athletes; he wanted the best athletes," says John Ruger, ombudsman for the United States Olympic Committee.

Now, many top athletes don't need financial support from their national governing bodies. "The approach of the NGBs just doesn't fit anymore," says Peter Carlisle, a sports agent who represents the Collection and other Olympic athletes.

When athletes are new to the game, they often need the team's support, says snowboarder Ross Powers. Fame changes that. Powers left the U.S. team seven years ago, when he was 19, because Burton Snowboards wanted him to use its products exclusively. But he missed the camaraderie and challenge of working closely with other athletes. The Collection gave him the benefits of a team, without the restrictions.

The same is true for Parra and Hedrick, who train on a team not connected to U.S. Speedskating. Parra and Hedrick stress that they broke from U.S. Speedskating because it was best for their performance, not just their pocketbooks. They were already working with their own coach and paying for it themselves. Jennifer Rodriquez, by contrast, stayed with the NGB because she liked the coach, though she could have made more money on her own.

The endorsement dispute began brewing after the 2002 Olympics, when speed skating started attracting lucrative corporate sponsorships. Under the contract they signed with the team, skaters were allowed to find their own sponsors for two spots on the uniform, the leg and shoulder. The team would find sponsors for another four spots.

But U.S. Speedskating reserved the right to find a sponsor for the leg area. In May 2004, the athletes learned that Qwest Communications would be taking the spot.

The Qwest deal left top skaters in a bind: break their contracts with other sponsors, or break with the U.S. speed-skating team. Parra, Hedrick, Davis and Witty chose the latter, each losing more than $25,000 in benefits.

"It's become a major problem because the top guys weren't wearing Qwest," says Thomas O'Hare, a law student and former speed skater who consults for the U.S. Olympic Committee. Katie Marquard, executive director of U.S. Speedskating, says Qwest continues to support the team despite the four skaters' absence.

Hedrick thinks U.S. Speedskating should have tried harder to keep its top Olympians. Marquard says the team tried to compromise, asking the four athletes to convince their sponsors to use a different spot on the uniform. "We thought we reached a mutually beneficial point," she says.

The athletes didn't agree. Hedrick and Davis are covered in DSB logos. Parra kept the leg spot for Dutch company Timeout Sport. He's also sponsored by Visa, Home Depot, Nike, Kellogg, Big Bear Mountain Water and Zions Bank.

"Every athlete I know of has a problem with the national governing body as far as spots they can use and how much money they can make," Parra says. "It seems like we're backpedaling if we can't have our athletes make some money."