Who's to blame for the lockout?

[Fafnir]

Given that player salaries as a league whole are fixed I don't think owners handing out dumb deals is a factor. It might hurt a single franchise by making them miss luxury tax money (or pay it) but that doesn't hurt the NBA as an entity.

I mean they didn't create the escrow system because they expected to be under 57% very often.

[Marcus13]

I don't really see how you can blame the players.  They're not giving themselves these insane contracts.

Revenue sharing and a hard/flex cap shall fix all

[Fafnir]

I don't really see how you can blame the players.  They're not giving themselves these insane contracts.

Revenue sharing and a hard/flex cap shall fix all

If they're still giving players 57% of all revenue and the league is actually losing money how will revenue sharing and a "hard" cap fix anything?

57% is already a hard cap when it comes to total salaries. The issue still is, and always has been how much money the players get in total.

[Marcus13]

I don't really see how you can blame the players.  They're not giving themselves these insane contracts.

Revenue sharing and a hard/flex cap shall fix all

If they're still giving players 57% of all revenue and the league is actually losing money how will revenue sharing and a "hard" cap fix anything?

57% is already a hard cap when it comes to total salaries. The issue still is, and always has been how much money the players get in total.

Yes, I completely agree that the total CAP is going to have to come down a considerable margin.  But individual franchises are losing a lot of money because they are unable to compete.  

A hard cap is going to make it so that there is basically a star per team.  Granted, there will be exceptions but these small market, cold climate franchises just don't have a chance right now

Also, player contracts shouldn't be 100% guaranteed.  The NFL has a pretty good system with their bonuses.  GM's/Teams should be punished for making bad signings and it should count against their cap...but you HAVE to be able to dump Rashard Lewis and get some of your money back

[CaptainJackLee]

Owners have let non-player expenses to rise faster than healtcare costs and have also had turnover occur with new faces wanting a better ROI based on their inflated purchase prices.

That's the core of the problem facing the NBA today.

Absolutely true. Right now player salary expenses are right in line with the other 3 major American sports, which by all accounts are profitable ventures as a whole.

I really doubt the financials the NBA teams are throwing out there and believe while a large portion of NBA teams are not making money, that the league as a whole is. I also believe that the amount of money that the majority of teams that are not making money is actually quite small on a yearly basis. I think revenue sharing and a minor give back by the players(57% to 54%, lower maximum raises per year, less years on guaranteed contracts) should fix things.

Yeps on the bolded part.

And agreed that those solutions should fix things. However,

However, it wouldn't be enough. I think some franchises are indeed losing money and they'd still lose money even after that. As long as the share of the players (and the cap) is defined as a slice of the general revenue and some teams add to the revenue so much more than others, those that add less will always be in trouble to compete in terms of payroll. That situation is aggravated by the existence of so many win-maximizers (as opposed to profit-maximizers) in the NBA.

So I believe that some other things - not strictly CBA related - are necessary:
- revenue-sharing
- the NBA should adopt a code of good management practices. A cap on debt, a cap on non-players salaries expenses, requirements to reliable financial reporting, some ethical procedures. I think those things would benefit the league in the long-run. You can't have owners borrowing money from teams at a much lower rate than the team borrows for itself or employing half a dozen of family members as executives or barmaids as scouts.  

I mostly blame owners because their current demands are so far away from a reasonable outcome.

[nickagneta]

Owners have let non-player expenses to rise faster than healtcare costs and have also had turnover occur with new faces wanting a better ROI based on their inflated purchase prices.

That's the core of the problem facing the NBA today.

Absolutely true. Right now player salary expenses are right in line with the other 3 major American sports, which by all accounts are profitable ventures as a whole.

I really doubt the financials the NBA teams are throwing out there and believe while a large portion of NBA teams are not making money, that the league as a whole is. I also believe that the amount of money that the majority of teams that are not making money is actually quite small on a yearly basis. I think revenue sharing and a minor give back by the players(57% to 54%, lower maximum raises per year, less years on guaranteed contracts) should fix things.

I disagree. This system is just not right.

As the article rightfully points out, right now the NBA revenue is in line with the NHL which is absolutely insane. There's just no way that the two should be even remotely close

Actually what the article states is that the NFL player salaries are about 56% of league revenues, MLB salaries about 58% of league revenues and the NHL salaries are at about 54% of league revenues.

The NBA salaries, as compared to all three other profitable overall sports league is right in line. In all other 3 profitable American sports leagues the players receive 54-58% of the league revenues. MLB and the NHL have significant revenue sharing in place. The NFL does as well though part of that lockout is about revenue sharing as well. The NBA revenue shares less than any sports league in America.

This needs to be resolved for the owners to get it to the point of every team being on an equal playing field without trying to decrease the players' share of revenues to a ridiculously lower level than that of the other three leagues that are all profitable and all have some form of significant revenue sharing.

[Roy H.]

Given that player salaries as a league whole are fixed I don't think owners handing out dumb deals is a factor. It might hurt a single franchise by making them miss luxury tax money (or pay it) but that doesn't hurt the NBA as an entity.

I mean they didn't create the escrow system because they expected to be under 57% very often.

Bad contracts do two things: 

1) They saddle individual teams with bad contracts, which are almost impossible to move due to the league's cap structure.  Larger teams can absorb these costs, but smaller market franchises cannot.  That leaves small market teams with a choice:  they can overspend their budgets in an attempt to compete to make up for that bad contract, or they can just surrender to the inevitable and focus on earning a profit.  Neither one is good for the health of the league as a whole, as the league needs as many viable franchises as possible.

2) An individual bad team's bad contract drives up the price for other franchises.  When guys like Travis Outlaw, Amir Johnson, Drew Gooden, John Salmons, Corey Maggette, etc., are all getting massively overpaid, it leads to better players expecting a more lucrative contract when they hit free agency.  While one answer is "don't pay", it seems inevitable that somebody will, leaving small market teams the same conundrum:  overpay, or get left behind.

There's no real doubt that 57% of BRI is too much for the players to be making on a league-wide basis.  However, in noting the capped costs for salary at the league level, don't be too quick to dismiss the impact that the decisions of a handful of owners can have on the league as a whole

[action781]

There is a major flaw in the system.  There is no way that a league with a salary cap will be fair if there are fully guaranteed contracts.  An injury to a max contract player will decimate a franchise for 5-6 years.  A franchise loses an awesome player, plus loses flexibility to replace that player.  One of the two (a cap or the guaranteed contracts) have to go.  And the league wants a cap so every team has a chance to compete, therefore, fully guaranteed contracts that count against that cap have to go!

[action781]

2) An individual bad team's bad contract drives up the price for other franchises.  When guys like Travis Outlaw, Amir Johnson, Drew Gooden, John Salmons, Corey Maggette, etc., are all getting massively overpaid, it leads to better players expecting a more lucrative contract when they hit free agency.  While one answer is "don't pay", it seems inevitable that somebody will, leaving small market teams the same conundrum:  overpay, or get left behind.

I disagree.  You said it, Roy, the answer is "don't pay".  Don't massively overpay players.  You might be bad for a little while, but you'll get good draft picks and get to sign talent on a bargain of a contract which will make you competitive.  Then you will have good young players, the choice of who to pay/modestly overpay, and a ton of cap space to go after the players who are actually worth the money.  And you will be one of the few teams who can go after these players because all the other teams will be overpaying for scrubs and have no cap room.  Teams will start to notice, teams will start to lose money (wait, that already happened), these will stop overpaying (they are smart people), and salaries will start to come down.

The owners who overpay are the most at fault.  Atlanta had a choice this past summer and letting JJ walk would have been a wiser choice than giving him the contract they gave him.  I don't care if they would be put out of contention.  Furthermore, if all the owners practiced making smart decisions, Atlanta would have been able to sign JJ to a reasonable contract.  And if it's inevitable that some other major market team could give him that contract and still be profitable, then revenue sharing is the ultimate answer.  Look at MLB.

[StartOrien]

I disagree.  You said it, Roy, the answer is "don't pay".  Don't massively overpay players.  You might be bad for a little while, but you'll get good draft picks and get to sign talent on a bargain of a contract which will make you competitive. 

But you have to keep interest in your team to sell tickets. Hard to keep interest up if you're sitting on your hands hoping that a diamond falls to you at the right price.

[Roy H.]

I disagree.  You said it, Roy, the answer is "don't pay". 

Easier said than done, though.  All it takes is a handful of owners / GMs to set a market, and once that market is set, teams either have to get in line, or fall to the back of the back.  Teams can either overspend, or they can stay within their means.  However, by staying within their means, they're losing games, and ultimately, fan interest.  Lack of fan interest means fewer gate receipts, fewer concessions, lesser local TV and radio deals, etc.  In turn, that leaves even less money to spend on players.

Revenue sharing obviously would help some, but controlling costs on an individual team level is the answer, I think.  The most prescient example continues to be the NHL, which went from a league on the brink of disaster to one that is currently very healthy.  I'm sure NBA owners are salivating thinking about a similar model.

[Papatrichs]

I'd choose both as the culprits... but my gut feeling says its Santa Claus. If he had given all the owners and players their wishes their might not be a lockout......


    sigh, definitely a very long offseason.

[xmuscularghandix]

Human nature, it theres money to be made everyone is going to feel that they deserve it more than the other guy.

[BASS_THUMPER]

gotta be the fan's fault

[action781]

I disagree.  You said it, Roy, the answer is "don't pay".  Don't massively overpay players.  You might be bad for a little while, but you'll get good draft picks and get to sign talent on a bargain of a contract which will make you competitive.  

But you have to keep interest in your team to sell tickets. Hard to keep interest up if you're sitting on your hands hoping that a diamond falls to you at the right price.

I was unclear, but that "talent on a bargain of a contract" I was referring to were the good draft picks on rookie scale contracts, which are very often the best valued contracts in the NBA for teams.

If you are in the bottom 5 of the league for 3 years, you are bound to get at least 1 very good player out of those 3 draft picks who will be on a bargain of a contract can turn your franchise around.  If you haven't overpaid for other players, you are bound to be in a position to be able to pay handsomely for good talent to accompany your young player(s) with, whereas, teams that massively overspent on other players won't be able to.

I disagree.  You said it, Roy, the answer is "don't pay".

Easier said than done, though.  All it takes is a handful of owners / GMs to set a market, and once that market is set, teams either have to get in line, or fall to the back of the back.  Teams can either overspend, or they can stay within their means.  However, by staying within their means, they're losing games, and ultimately, fan interest.  Lack of fan interest means fewer gate receipts, fewer concessions, lesser local TV and radio deals, etc.  In turn, that leaves even less money to spend on players.

Revenue sharing obviously would help some, but controlling costs on an individual team level is the answer, I think.

If there is some sort of cap in place, then teams can only overspend so much.  I think revenue sharing would do more than just "help some"; I think it is the key.  If teams are able to overspend and exceed a soft cap, make it a $1 for $1 luxury tax for the first $15M over the cap, then $2 for $1 tax for every dollar over that threshold.  Teams won't be spending like idiots anymore and the league can use that tax money as revenue sharing for the teams unable to spend that much money.

In terms of gate receipts/ticket sales, which both of you mentioned, that shared revenue can allow the franchise to sell tickets at much lesser costs which will keep bringing fans to the games.  How many of you still attended celtics games from 1996-2006?  I know I did.  Fans will still go to games even when their team isn't winning.  They just won't be selling out every game nor be able to sell for as much money as the better teams, which, yes, does mean less money, but that's where the revenue sharing takes care of that.  Look at the Golden State Warriors from '94-2006 and Clippers from '97-2006.  Both franchises were extremely horrible for long stretches of time...  They still stayed around.  Fans still go to Pirates, Orioles, Marlins, etc. baseball games.  Why?  Cheap tickets.  How can those franchises afford to sell such cheap tickets?  MLB's Revenue sharing.  I think it's the answer.