Damn, glad you guys told me spec was dead...though I guess I should return nearly 90% of my income this year that was made on spec, and defer the few grand I know that will come in by the end of the year telling people not to buy because the model doesn't work
Just proving the exception to the rule folks! Stinking rich, no...surviving, yes. Making more than the local newspaper photographers, yes. Quit any non-photography jobs, yes. Growing each year, yes. All based off youth photography spec, hell no (about 25%).
For the most part spec is very difficult because like Matt said teams have a parent that has comparable gear to what amateurs are starting out with and getting the same or better results. They sure love looking at the photos, and even if it blows away what they can get free, they often don't buy. Of my events I'd say maybe at most 10-30% of parents buy. That's with having access they don't have, gear and the knowledge how to use it producing results they can not get.
The biggest problem with spec is simple, you just don't know. You can shoot a league all year and get a couple hundred dollars, or you can shoot one game and get a couple grand. I've been on the end of both spectrums, hell one shot about 8 games and made one $8 sale - guess what I didn't shoot much of this year? If you're looking for a guaranteed paycheck you think you'll make every game you won't find it in spec.
Second problem is figuring out what to shoot, the local youth league is probably not getting you much cash at all. I do a couple grand shooting the youth league portraits but when it comes to action the stuff sits there with the exception of a few loyal parents. Local high school league does very poorly, the one 45 mins down the road does better. Regular season games for a losing team do horrible, regular season games for a winning team do OK, playoffs and championships, all-stars, etc. do better. Even at the youth level it matters how the season is going, remember coaching 8th graders once and doing the photos, can't count how many times I heard "we're having a great season, I have to buy" or similar comments.
It's a hard market, most can't sustain it and most only do it as side income. Some do very well with it and others do not. If you're not producing quality that blows them away then your chances for failure are big, and remember they will ALWAYS tell you how great they are even if they are not very good. What matters is the numbers, you cut the bad and put in the good, you take chances and see how events go. Parents can easily tell someone there just shooting for the heck of it and doesn't know much of what they're doing and someone who does, that matters.
As for other questions...
Permission - yes you need to talk to the league coordinator to get the OK to shoot, spec shooting may be defined as showing up and shooting hoping to sell with no guaranteed paycheck but you still need permission. Even going to shoot photos of my cousin in a championship game this year I tracked down the commish before unpacking anything asking if it was OK to shoot images of my own cousin. Don't ever just show up and be the creepy guy with a camera.
Kick backs - whoever started this should be slapped. The local league asked about it and I told them no problem, but I'll have to raise the prices and it's the parents who are actually paying it. Soon as they realized I have a cost of doing business and the only way to get a kickback was to raise prices on the parents they said never mind. Now some leagues don't care, it's a fundraiser for them, whatever. Photographers now use it as an incentive to get jobs, you just have to price accordingly like most new photographers do not. Look around at peoples sites off here and you'll see prices all over the place that were not researched at all or have no backing at all. These are the people that are selling 4x6's at $2 and 8x10's at $15..the ones that make no sense.
Other photographers - if one has the league you don't go shoot, it's that simple. You want to shoot that league you get the contract! Stepping on toes does nothing positive for you and you can find yourself in the middle of a lot of problems, even if you're better than the hired photographer it's NEVER the way to go about it.