AUSTRALIA Law and Practice Contributed by: Sven Burchartz and Jessica Bell, Kalus Kenny Intelex
Risks in NFTs in the Sports Industry in Australia The NFT market in the Australian sports industry has somewhat cooled off in recent years. During what is arguably the peak years of NFT popularity, in 2021 and 2022, sports fans were scrambling to secure an NFT of their favourite sports team’s memorabilia in the hope that the NFT would increase in value. However, the sports industry has gone a little quiet on the NFT front, perhaps given the uncertainty around the value of NFTs, which is not as strong as other digital assets or currencies. NFTs also carry risks associated with con - sumer protection, IP rights and reputational damage, particularly when NFTs lose value or are discontinued. 10.2 AI The regulatory framework for artificial intelligence (“AI”) in Australia is generally still in a developmental stage, with some state governments conducting inquiries into the use of AI. For example, the New South Wales government conducted an inquiry between June 2023 and October 2024. Australia is yet to implement spe - cific AI legislation; however, existing laws, such as the Privacy Act, the Australian Consumer Laws and spe - cific surveillance laws, continue to apply to the use of AI in sport. In Australian sport, organisations are utilising AI to optimise performance. By way of example, many AFL clubs are utilising AI technology to provide statistical analysis for their team’s performance. They are also using it to provide summaries of opposition teams’ vulnerabilities, strengths and weaknesses in order to prepare for games. AI is also revolutionising the approach to managing Anterior Cruciate Ligament (“ACL”) injuries. ACL inju - ries have become increasingly prominent and impact athletes across all sports and levels and AI mecha - nisms have been a key technological innovation com - ponent of orthopaedic surgery. AI-based technolo - gies are being used in a wide variety of applications, including: • image interpretation; • automated chart review; • assistance during physical examination via optical tracking with infrared cameras or electromagnetic sensors;
• predictive model generation; and • optimisation of postoperative care and rehabilita - tion. Organisations are also increasingly using AI to measure fan engagement, personalise content delivery, optimise ticketing and deliver enhanced analytics to commercial partners. These uses of AI are not without risk, as they may give rise to privacy concerns, algorithmic bias, cybersecurity vulnerabilities and integrity issues. As AI progresses, its integration into various facets of the sports industry is anticipated to expand, poten - tially influencing job roles in areas where AI proves to be more efficient. This trend of AI impacting employ - ment is not confined solely to the sports sector. 10.3 The Metaverse The metaverse is revolutionising the sports experience for fans, taking them beyond watching sports on a screen or in a stadium, to immersing them as active participants in digital and interactive environments. The concept of the metaverse is still somewhat new to the Australian sports landscape. In 2023, the Aus - tralian Open introduced the metaverse experience to tennis fans, expanding that offering in 2024 to include the ability for Roblox users to compete in virtual ten - nis-themed games to win prizes. Off the court, many sports are utilising virtual fan zones, VR training environments and digital stadiums to engage with fans and train athletes in more ways. As the use of AI and technology continues to grow within the Australian sports industry, it is likely that more sports will begin to offer more opportunities for engagement with fans through the metaverse. However, challenges will continue to arise for sports attempting to enter the metaverse. The lack of a regu - latory framework in this space will pose a significant risk to users and organisations that engage with the metaverse. The risk of cyberattacks, adverse impacts on the mental health of users, the risk to child safety online and exposure to fraudulent activity may increase if appropriate protections are not put in place.
25 CHAMBERS.COM
Powered by FlippingBook