Who's to blame for the lockout?

[Eja117]

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.

This is one thing I totally disagree with.  There is no comparison between what a good, but non-star in the NFL makes and a good, but non-star in the NBA makes.  There was also never a time when a Juwan Howard NFL type could get anything remotely similar to a 7 year $99 million deal. Even adjusted for the revenue they make.

In the NFL if you're horrid, you're gone. It's extremely common in the NBA that if you're horrid like Scala you can still get $3 mill/yr or you can be Oden and get $8.8

Nobody on the planet gets a deal like the average NBA player. Nobody.  The only place NBA players do worse is the draft.  If you're the #1 pick, you'll get an ok deal, then the team will have two options to exercise, whereas you can be Ryan Leaf in the NFL and get way too much money. Other than that NBA players have it way way way over NFL. 

[Eja117]

And the last option I don't agree with at all.  NBA has passed the MLB.  If anything it is the NHL CBA that they are jealous of.

MLB brought in something like $500 million in profits last year, though.  The NBA, depending on who you believed, either made around $150 million or lost $300 million.  Either way, the NBA business model is working worse than baseball's, salary cap or not.

In terms of who I blame...  I'd say a healthy mix of capitalism (players and owners both want to maximize income) + stupidity of owners in handing out bad contracts + a flawed league structure where not enough is done to share revenues.

I agree a lot with this

[greenpride32]

The "don't pay the players" theory doesn't work under the current system.  Just look at the guys we lost from our title team what we wanted to retain; Posey, TA, Perk.  Why did they all leave; because they wanted to get paid and went to the highest bidder.  The problem is larger market teams will scoop up all of these players if the smaller market teams "don't pay".  What you end up with is a huge competitive inbalance.  A team full of vet min players and rookie contracts will not likely draw at the gate, sell any merchandise, or land any lucrative TV contracts.  

Someone mentioned player like Salmons and Maggette; a smaller market team can only draw these types of players.  The Bucks were an up and coming team with Bogut an Jennings; what are you going to do as the owner?  Try to add a piece of two to make a deep playoff run, or just give up and trade Bogut away and say we can't afford to spend the money?  If the latter, then why bother even owning and operating this franchise?

And are people really going to support the players when you have a guy like Eddie Curry who doens't stay in shape while collecting $10m a year for doing nothing but eating cheeseburgers?  His level of play warranted the contract he received when he signed it, but then he chose not to live up to it.  In the NFL this isn't a problem.  

[Eja117]

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.

Very good points and true true true


however


the NBA needs to look at something

The NFL plays way less games....16 games plus 4 preseason and a shorter post season.  Then they spread out the money over 60ish players per team. And the players don't get the guaranteed contracts that cripple a team.

The NBA plays 82 games, more preseason games, and a longer post season.  Granted an arena is smaller than a stadium, but it's also a more global sport.  Plus NBA players have longer, less painful careers. Plus that money is spread out among 15 players, not 60.

The NBA players could have accepted a smaller percentage, and as a result their league could have had a better product and the average player would still have had a longer and far more lucrative career.

Instead they bit off more than they could chew and wanted us to feel sorry for them.  Yeah right. Nice try.  Give me a football player over an NBA guy any day times ten.

[PosImpos]

It's the last one by a long shot.  I guess you could say the owners are greedy, depending on your definition of the word.  I think it's reasonable for them to want the NBA to show profits similar to the NFL and MLB, and the current system doesn't allow teams to make that kind of money.  

I disagree that it's unreasonable for the owners to want profit certainty considering there is such a thing in other major sports.

If you don't think this dispute is at least in part about small markets vs. big markets, then you're kidding yourself.  Teams like the Lakers, Knicks, Bulls etc would probably be perfectly happy keeping things the way they are.  It's teams like the Hornets, Bucks, Grizzlies, Nuggets etc that have a problem.  They want to compete but can't because they can't afford to pay luxury tax.  Meanwhile, Donald Sterling turns a profit off the Clippers cause he barely spends any money on them and doesn't have to pay as much for the use of the Staples Center.

[nickagneta]

I don't buy the "you have to overspend in the market to stay competitive and bring in the fans" argument.

First, Oklahoma City pretty much dispels this. Chicago does as well as they have been very competitive over the last 7 years but have consistently been at around $60 million in salary or less. Good management is more responsible for good teams and bringing in fans than is overspending at will.

Second, every year 18-20 teams are playing to 90% capacity regardless of record. Last year, 5 teams that didn't make the playoffs played to over 90% capacity, Warriors, Jazz, Cavs, Suns and Clippers.

Third, Atlanta and Philadelphia are routinely in the top 10 of team payroll yet are just as routinely below 85% capacity.

I think what brings in the fans are size of market, economics within the market, situations within the market and team performance.

Win and they will come. Settle into a community that will support you, and they will come. Have a team in a big market and that is in a relatively good economic place, and they will come.

But the problem is the NBA over-expanded by some 4 teams at the least. Charlotte, New Orleans, Sacramento and Memphis are just not markets that can sustain an NBA team and there probably not 4 more markets in North America that will support an NBA team. That decision to over expand is on the owners and the commissioner and without those teams overall revenue sharing wouldn't be such a problem and team quality would be better allowing more teams to compete instead of having basically 6-8 teams without any hope of ever winning a championship.

[action781]

I don't buy the "you have to overspend in the market to stay competitive and bring in the fans" argument.

First, Oklahoma City pretty much dispels this. Chicago does as well as they have been very competitive over the last 7 years but have consistently been at around $60 million in salary or less. Good management is more responsible for good teams and bringing in fans than is overspending at will.

Second, every year 18-20 teams are playing to 90% capacity regardless of record. Last year, 5 teams that didn't make the playoffs played to over 90% capacity, Warriors, Jazz, Cavs, Suns and Clippers.

Third, Atlanta and Philadelphia are routinely in the top 10 of team payroll yet are just as routinely below 85% capacity.

I think what brings in the fans are size of market, economics within the market, situations within the market and team performance.

Win and they will come. Settle into a community that will support you, and they will come. Have a team in a big market and that is in a relatively good economic place, and they will come.

But the problem is the NBA over-expanded by some 4 teams at the least. Charlotte, New Orleans, Sacramento and Memphis are just not markets that can sustain an NBA team and there probably not 4 more markets in North America that will support an NBA team. That decision to over expand is on the owners and the commissioner and without those teams overall revenue sharing wouldn't be such a problem and team quality would be better allowing more teams to compete instead of having basically 6-8 teams without any hope of ever winning a championship.

I agree with everything said nick. 

[Eja117]

I don't buy the "you have to overspend in the market to stay competitive and bring in the fans" argument.

First, Oklahoma City pretty much dispels this. Chicago does as well as they have been very competitive over the last 7 years but have consistently been at around $60 million in salary or less. Good management is more responsible for good teams and bringing in fans than is overspending at will.

Second, every year 18-20 teams are playing to 90% capacity regardless of record. Last year, 5 teams that didn't make the playoffs played to over 90% capacity, Warriors, Jazz, Cavs, Suns and Clippers.

Third, Atlanta and Philadelphia are routinely in the top 10 of team payroll yet are just as routinely below 85% capacity.

I think what brings in the fans are size of market, economics within the market, situations within the market and team performance.

Win and they will come. Settle into a community that will support you, and they will come. Have a team in a big market and that is in a relatively good economic place, and they will come.

But the problem is the NBA over-expanded by some 4 teams at the least. Charlotte, New Orleans, Sacramento and Memphis are just not markets that can sustain an NBA team and there probably not 4 more markets in North America that will support an NBA team. That decision to over expand is on the owners and the commissioner and without those teams overall revenue sharing wouldn't be such a problem and team quality would be better allowing more teams to compete instead of having basically 6-8 teams without any hope of ever winning a championship.

Wait a minute. I see what you're saying here, but hold on.

Take Seattle. No reason it shouldn't have an NBA team. They have football and baseball.

And Sac town....They've had a team there for 30 years. How much sustain are we talking about? Sacramento is a bigger city (according to wiki, so it must be right) than Atlanta, Kansas City, Miami, Cleveland and many others. And they only have one team to support.

Memphis is bigger than Boston and Washington

New Orleans is actually very small. Smaller than Bakersfield CA. Tampa and Pittsburgh are smaller, though

[Eja117]

http://sports.yahoo.com/nba/blog/ball_dont_lie/post/Everyone-look-at-Joe-Johnson-8217-s-giant-truck?urn=nba-wp5970


somebody has got to tell these players if they want to do well during this lockout not to do things like this.


Hey guys, During the lockout put away the bling

[action781]

I don't buy the "you have to overspend in the market to stay competitive and bring in the fans" argument.

First, Oklahoma City pretty much dispels this. Chicago does as well as they have been very competitive over the last 7 years but have consistently been at around $60 million in salary or less. Good management is more responsible for good teams and bringing in fans than is overspending at will.

Second, every year 18-20 teams are playing to 90% capacity regardless of record. Last year, 5 teams that didn't make the playoffs played to over 90% capacity, Warriors, Jazz, Cavs, Suns and Clippers.

Third, Atlanta and Philadelphia are routinely in the top 10 of team payroll yet are just as routinely below 85% capacity.

I think what brings in the fans are size of market, economics within the market, situations within the market and team performance.

Win and they will come. Settle into a community that will support you, and they will come. Have a team in a big market and that is in a relatively good economic place, and they will come.

But the problem is the NBA over-expanded by some 4 teams at the least. Charlotte, New Orleans, Sacramento and Memphis are just not markets that can sustain an NBA team and there probably not 4 more markets in North America that will support an NBA team. That decision to over expand is on the owners and the commissioner and without those teams overall revenue sharing wouldn't be such a problem and team quality would be better allowing more teams to compete instead of having basically 6-8 teams without any hope of ever winning a championship.

Wait a minute. I see what you're saying here, but hold on.

Take Seattle. No reason it shouldn't have an NBA team. They have football and baseball.

And Sac town....They've had a team there for 30 years. How much sustain are we talking about? Sacramento is a bigger city (according to wiki, so it must be right) than Atlanta, Kansas City, Miami, Cleveland and many others. And they only have one team to support.

Memphis is bigger than Boston and Washington

New Orleans is actually very small. Smaller than Bakersfield CA. Tampa and Pittsburgh are smaller, though

You're right in that Seattle should have a team.  They have the economics to support one.  The reason they don't is because Howard Schultz was selfish and sold the team because the city of seattle wouldn't shell out a ton of money to renovate Key Arena.

I think if run properly, Sac can support a team.  It's not an easy market too, though.  And size of the city is not the only factor to consider when deciding if it is a viable market for a team.

[CaptainJackLee]

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.

That's not correct. The NHL is currently facing similar problems to the NBA exactly because the controlling costs on an individual team level doesn't work:

    A look at teams’ operating income – earnings before interest, taxes, depreciation and amortization – according to figures published last December by Forbes.com, shows the league is in the same predicament it was in 2004, just before the lockout. The gap between the richest teams and the poorest teams is as wide as it was then and growing.

    After the NHL Players’ Association was defeated in the lockout, the salary-cap system, accompanied by revenue sharing, was supposed to solve the big market-small market woes. Player salaries became based on a percentage of hockey-related revenues, which is now at 58 per cent, so the owners had the “cost certainty” they long had wanted.

    However, the rise of the Canadian dollar combined with the traditional revenue gap between rich and poor teams hit the league with a double-whammy. The six (and since last week seven) Canadian NHL teams now account for the lion’s share of NHL revenue and drive up player costs.

http://www.kuklaskorner.com/index.php/hockey/comments/small_market_teams_still_having_problems/


North-American sports league need to make an option: they need to decide between competitive balance or selling non-competitive leagues (and eventually much smaller leagues, leaving small-markets out of top pro-sports competitions). If they decide for the former, then extremely robust revenue sharing systems are needed.


NBA owners are trying the trick of solving this problem via players salary suppression. But that won't work because it'll make the league overall "too profitable". And businesses go down because they aren't profitable enough or because they're too profitable. Competitive balance can only be achieved via revenue-sharing.

There's a reason why in every sports league in the world, the slice of the players is about 55% of the revenue (the exceptions being a couple of European soccer leagues that benefit from huge capital injections from a few owners so that number is higher - of course, there's no competitive balance on those leagues - or, on the other side, a league like the MLS, that benefits from being a single-entity - making it a league of profit-maximizers as the owner always win - and from being a 3rd rate league that doesn't really compete for top-talent). If the owners try to solve this problem by mainly controlling costs at an individual team level sooner or later we'll have a "press conference on the US Open parking lot" situation on our hands.

[thirstyboots18]

hmmm.  Greed v. Incompetence.    hmmm.  Incompetence v. Greed.

Sorry...this choice is beyond my capability.   My heart hurts. To make myself feel better I am going back to the community center and watch whatever age level team is playing.  They seem to appreciate my interest...

[Moranis]

But the problem is the NBA over-expanded by some 4 teams at the least. Charlotte, New Orleans, Sacramento and Memphis are just not markets that can sustain an NBA team and there probably not 4 more markets in North America that will support an NBA team. That decision to over expand is on the owners and the commissioner and without those teams overall revenue sharing wouldn't be such a problem and team quality would be better allowing more teams to compete instead of having basically 6-8 teams without any hope of ever winning a championship.

For me the expansion isn't about too many teams, it was about diluting the talent to much as there are some awful awful teams with not enough talent to go around.  The Charlotte metroplex is pretty large, as is New Orleans and Memphis.  Now perhaps they just aren't professional basketball markets, but they are certainly big enough to support a team.  As is Kansas City, Pittsburgh, St. Louis, Cincinnati, Louisville, and Seattle all of which do not have NBA franchises at the moment. 

The only way that will really work is robust revenue sharing.

[LooseCannon]

I blame the owners.

If the owners were more honest about their finances and how much their losses actually are, and if the owners did not adopt what appears to be a siege mentality of trying to wait until the pain is too much for the players to bear, then perhaps this situation would not be happening.

It may be good business strategy for ownership to conceal information and to wait until September or October before making any serious offers, but it's still the owners' fault.

[Roy H.]

It may be good business strategy for ownership to conceal information and to wait until September or October before making any serious offers, but it's still the owners' fault.

What are you basing the claims that they're hiding money on?  According to the league, they've completely opened their books and have had an independent auditor (agreed to by the NBAPA) verify the results.

I have no idea if the numbers are accurate or not, but the NBA is publicly welcoming inspection of their books, so I tend to find reports of the league losing money to be more credible than, say, in the NFL (where the players have had to fight more aggressively for the full books).