WNBA subsidies hurting the owners case.

[nickagneta]

The NBA owners are claiming massive losses. If believed, they have been losing money since the last CBA was signed and a majority of teams lose money, though this is in dispute.

What isn't in dispute is that the WNBA has been subsidized by the NBA owners and has been losing money since its inception in 1997. Estimates are that the WNBA has lost somewhere between $10 million and $24 million a year for many years and that recently those numbers have come down.

Total investment due to subsidies from this league since its inception have varied depending on where you look and who you believe but it is believed to be somewhere in the $100-$250 million area since its start up.

Should the NBAPA be having to take salary cuts to subsidize a league that can't make money? To subsidize a league who's ratings for its Finals are somewhere lower than that of local area television static late at night when the station has signed off?

If the owners are as broke as they claim then maybe they need to look at the total picture like lost cause investments like the WNBA, the supporting of 2-4 franchises that can't be sustained due to over saturation of the market, and the revenue sharing of local television revenues.

Still think the players need to give money back and give up guarantees in their contracts so that 5 year contracts of hurt players or players that don't produce can be canceled. But the owners need to look in a mirror and look at their total investment picture including areas they invest in outside of their teams that show up in their GAAP financials.

[PosImpos]

I agree.  The WNBA is, as Bill Simmons called it, a "noble luxury" that the league can no longer afford.

[Roy H.]

According to Stern, the WNBA broke even in 2009 and made a profit in 2010.  Also, it's clear that the league sees this as a long-term outreach project to attract more female fans to the NBA.

Even if the WNBA was still losing $10 million per season (which it isn't), that's $300k per owner. That wouldn't be a terrible investment. However, reality is rosier than that.

[PosImpos]

According to Stern, the WNBA broke even in 2009 and made a profit in 2010.  Also, it's clear that the league sees this as a long-term outreach project to attract more female fans to the NBA.

Even if the WNBA was still losing $10 million per season (which it isn't), that's $300k per owner. That wouldn't be a terrible investment. However, reality is rosier than that.

Still, it is certainly more difficult to believe the owners complaints of financial difficulties when they are still supporting an "outreach project" which has lost many millions of dollars of its life-span, and still doesn't show signs of being very profitable (if at all) despite that heavy investment.

[Who]

D-League is just as big, if not bigger, waste of money.

[Fafnir]

According to Stern, the WNBA broke even in 2009 and made a profit in 2010.  Also, it's clear that the league sees this as a long-term outreach project to attract more female fans to the NBA.

Even if the WNBA was still losing $10 million per season (which it isn't), that's $300k per owner. That wouldn't be a terrible investment. However, reality is rosier than that.

Ha I wonder if they use the same accounting approach to the WNBA as they do the real NBA.

I bet they could make it a 50 million dollar loser if they tried.

[Moranis]

D-League is just as big, if not bigger, waste of money.

Yep.  Lots of money lost trying to grow the game that just hasn't been working and is not furthering the players interest. 

[Roy H.]

According to Stern, the WNBA broke even in 2009 and made a profit in 2010.  Also, it's clear that the league sees this as a long-term outreach project to attract more female fans to the NBA.

Even if the WNBA was still losing $10 million per season (which it isn't), that's $300k per owner. That wouldn't be a terrible investment. However, reality is rosier than that.

Still, it is certainly more difficult to believe the owners complaints of financial difficulties when they are still supporting an "outreach project" which has lost many millions of dollars of its life-span, and still doesn't show signs of being very profitable (if at all) despite that heavy investment.

If that outreach project is profitable, while at the same time winning fans for the long-term, why would that have anything to do with the owners' complaints?

I mean, what owner wouldn't want to invest in a project that is making money in the short-term, and is laying a strong foundation for more money in the future?  If the WNBA was losing money like it was 10 years ago, I'd absolutely agree with you and nick.  However, since it's making money, it's hard to argue that it doesn't make fiscal sense.

[Fafnir]

According to Stern, the WNBA broke even in 2009 and made a profit in 2010.  Also, it's clear that the league sees this as a long-term outreach project to attract more female fans to the NBA.

Even if the WNBA was still losing $10 million per season (which it isn't), that's $300k per owner. That wouldn't be a terrible investment. However, reality is rosier than that.

Still, it is certainly more difficult to believe the owners complaints of financial difficulties when they are still supporting an "outreach project" which has lost many millions of dollars of its life-span, and still doesn't show signs of being very profitable (if at all) despite that heavy investment.

If that outreach project is profitable, while at the same time winning fans for the long-term, why would that have anything to do with the owners' complaints?

I mean, what owner wouldn't want to invest in a project that is making money in the short-term, and is laying a strong foundation for more money in the future?  If the WNBA was losing money like it was 10 years ago, I'd absolutely agree with you and nick.  However, since it's making money, it's hard to argue that it doesn't make fiscal sense.

You assume Stern is playing it straight.

[Roy H.]

You assume Stern is playing it straight.

Well, it's not like this is a new thing.  The WNBA went from big subsidized deficits, to smaller ones, to breaking even, to turning a small profit.  I see such a gradual trend as credible.  I'd have a completely different outlook if the WNBA had been running $10 million deficits every year, and then the year the CBA was up, the league claimed profitability.

Unless the league has been setting up this farce for over a decade, I have no reason to doubt the gradual trend toward profitability.

[Chris]

You assume Stern is playing it straight.

Well, it's not like this is a new thing.  The WNBA went from big subsidized deficits, to smaller ones, to breaking even, to turning a small profit.  I see such a gradual trend as credible.  I'd have a completely different outlook if the WNBA had been running $10 million deficits every year, and then the year the CBA was up, the league claimed profitability.

Unless the league has been setting up this farce for over a decade, I have no reason to doubt the gradual trend toward profitability.

Yeah, and it makes sense.  It takes time for any sports league to take hold, but once they do (and I think the WNBA has taken hold of their particular market), then they can certainly be sustainable.  Considering they have a national TV deal, and the overhead is not all that high, I am not surprised the league is (slightly) profitable.

[greenpride32]

OP - Do you even now what GAAP is?  It's the same set of rules that all publicly traded companies must follow when reporting their financials.  So you're saying the NBA should report it's balance sheet differently than Wal-mart, Coca Cola, IBM, American Express, and Microsoft? 

GAAP stands for generally accepted accounting principals and is in place in part to ensure companies follow a standard which prevents them from creatively trying to manipulate the results in their favor.  So you're trying to say the owners are using GAAP to manipulate the numbers in their favor?  Any independent auditing firm would favor the NBA. 

There is actually no dispute from the NBPA that some teams are losing money; the dispute is the acutal loss amount. 

I read an article recently that said NBA team ownership turnover is at it's highest since the last CBA.  If you feel owners are doing so well with their NBA franchises; why are so many so eager to get out?

[PosImpos]

D-League is just as big, if not bigger, waste of money.

Probably so. 

I wonder, do minor league baseball teams tend to make money?  I would assume that they do (in general).  Of course, they'd be justified even if they didn't because they are used extensively by MLB teams to develop their young players (plus, the MLB can obviously afford it). 

I don't think there's much question that the D-league is not being used up to its potential as a true "development league" for NBA teams.

[Moranis]

D-League is just as big, if not bigger, waste of money.

Probably so. 

I wonder, do minor league baseball teams tend to make money?  I would assume that they do (in general).  Of course, they'd be justified even if they didn't because they are used extensively by MLB teams to develop their young players (plus, the MLB can obviously afford it). 

I don't think there's much question that the D-league is not being used up to its potential as a true "development league" for NBA teams.

I know the Dayton Dragons make money.  They are the Class A baseball team for the Cincinnati Reds and on July 9th, set a Sports Record with their 815th consecutive sell out (the Portland Trailblazers had the previous record from 77-95).  In fact, every single game ever played in Dayton has been a sell out (the team moved from Rockford, Illinois in 2000).  During the streak they have averaged 8,375 which is 116% capacity.  Last year they averaged 8,534.  It is absolutely mind boggling that a Class A team can have that sort of success (even in a small stadium), especially one that is only 50 miles from its major league affiliate. 

[TheReaLPuba]

Women's College Basketball is more popular than the WNBA.

You expect me to believe that a league no one watches or cares about is making more money than the NBA?

Get real.