Can LeBron James and Adam Silver avoid a lockout? (USATSI)
There's a new TV deal, and it's worth billions! So much money for everybody! It's a party in the NBA and everyone's getting a goody bag full of cash!
Yeah, OK, now that the celebration is over, there's a lot of bad news. Ken Berger has the breakdown of the phase-in of the deal and why it's significant on the cap sheets of players, as well as the inevitable conversation to arise out of this regarding the elimination of max contracts. And players are starting to respond to all the feel-good buzz. And beyond it, there's this reality: Players are looking at this new deal and wondering what happened to all that financial hardship owners talked up while routing the players in the 2011 CBA negotiations.
And the biggest name is the first to issue comment.
LeBron said there is "no way" owners can cry poor in the next CBA negotiations, not "after we continue to see teams selling for billions"
— Dave McMenamin (@mcten) October 6, 2014
LeBron's money quote on owners trying to claim they're losing money: "That will not fly with us this time"
— Dave McMenamin (@mcten) October 6, 2014
Just like a new TV deal was negotiated years ahead of time, LeBron wants to work on new CBA now: "We would love to do it sooner than later"
— Dave McMenamin (@mcten) October 6, 2014So that's fun.
James is the spokesperson for the players by way of being its biggest star, despite not being a member of the executive committee, or a player's representative in the NBPA. But his voice carries the most weight and he's close with NBPA President Chris Paul. That's where a significant portion of the conversation about eliminating the max contract structure comes from. And since 2011, James has been more actively involved in league matters.
The players can opt out in 2017. They're almost certain to, based on multiple projections. Whether that leads to a lockout is another question. It's possible the owners could realize they took more than their fair share in the last negotiation and their leverage points (the economic downturn which began in 2007, the fact several teams were failing to turn a profit, the competitive imbalance which has since been corrected in smaller markets' favor) are no longer as relevant. That could happen, right? Would bilionaire owners really be so driven by profit margin that they push even further?
What am I saying, of course they would be.
Brooklyn Nets star Deron Williams for example, is already bummed out by what's coming. From the New York Daily News:
"I think it's going in pretty much the same direction as it was last time (lockout of 2011)," said Williams, who is Brooklyn's union rep. "So I feel like we made a lot of concessions last time, and it's going to be hard for us to do that again. With the new leadership we have and (former NBAPA president Billy Hunter) finally being out of the picture, which is a great thing, hopefully things will go better for us."
"I hope guys are preparing (for a work stoppage)," said Williams, who played overseas during the 2011 lockout — a stoppage into December that cut 16 games off the NBA season. "When I first got in the league (in 2005), it's when the old collective bargaining agreement was just kicking in. And as soon as I got in the league, they were already telling us to prepare for the next lockout. And it was ingrained in my mind. And I was prepared for that. I didn't know that everybody did. So I would hope that people in the league learned from that and can tell the younger guys as well.
"We just have to start preparing early as a union (for a work stoppage). When we had a meeting in July, that was the focus of the meeting. We'll be better prepared this time, we'll be more ready to take different actions if need be."
via Deron Williams says players should prepare for another lockout as NBA announces new $24 billion TV deal with ESPN and TNT - NY Daily News.
Meanwhile, if you were wondering about what the mood around various analysts was regarding the lockout, it's not great, either.
Sports Illustrated comes down as "we're screwed."
First, the $24 billion TV deal is further evidence that the NBA's lockout of players in 2011 did not harm the game's popularity, either with fans or broadcast companies, in any lasting way. The league is making more money than ever and league officials likely infer from the new TV deal that the 2011 lockout significantly improved the financial health of the league. The league is also keenly aware that litigation brought by NFL players to end the NFL's 2011 lockout failed, thus giving the NBA more confidence that labor law insulates the league from lockout liability. If NBA officials and owners were given a truth serum and forced to answer questions, they would likely admit that locking out the players in 2017 is an attractive option. The NBA could lock out the players and demand a higher percentage of BRI, among other concessions the league wants from the players, while feeling confident that any backlash from fans would be manageable and ephemeral, and that any lawsuits by players would be easily defended.
Second, NBA owners now have more money on the line in BRI, and thus a greater incentive to demand a higher percentage in a new CBA. Remember that in the last set of labor negotiations, the league originally demanded that players receive only 41 percent of BRI. Watch for the league to make a similar demand as 2017 approaches, or perhaps demand an even lower percentage than 41. The NBA could reason that even with a smaller percentage of BRI, NBA players still stand to do well due to the growth of revenue. The players would vehemently reject such reasoning, especially since it will be hard for the NBA to again claim its teams are “losing money." In 2011, the NBA asserted that 22 of the 30 teams were in the red. With the Clippers selling for $2 billion and with the infusion of new TV money, it seems hard to imagine many – if any -- teams are losing money.
via NBA's new TV deal brings lockout, expansion pay raise for Adam Silver into play - NBA - SI.com.
But there are some rays of sunshine. For starters, noted cap expert Larry Coon who operates the invaluable CBAFAQ.com and has done work for teams, has some ray of hope.
So what's going to happen in 2017? To start with, I think the players are going to opt out of the CBA. Their reasoning will be that they did their share when times were hard, but now they're past the hard times, and they want some of their concessions back. Plus the new national TV deals will be going into place, and they will want to reap in some of that windfall as well.
How will the owners react? Unlike 2011, when they would rather shut down the league than continue to play under an unsustainable system, the owners will be more inclined not to kill the goose that lays the golden egg. I think they will be much more amenable to finding some middle ground with the players, and therefore I'm thinking there will be a new agreement in place in time for the season to start as scheduled. So no — I don't think the league will miss games in 2017.
via NBA Chat with Larry Coon 10/2/2014 | Basketball Insiders | NBA Rumors And Basketball News.
Count Zach Lowe of Grantland.com as well, but with the caveat that he admits he's being too sunny:
I'm clearly in the minority, but I'm optimistic the league can avoid a work stoppage. This will be Silver's major test, and he has already started some quiet lobbying with owners against a preemptive lockout in 2017.
The league smushed the union in the 2011 lockout, trimming the players' share of revenue from 57 percent down to 51 percent. The league just contorted itself through the Sterling situation, this new TV deal is a boon, and team valuations are rising by the day. Silver should and probably will try to convince the 30 owners to surf the rising tide without risking a lockout that could engender ill will.
Only nine teams lost money on basketball-related activities last season, per league documents reviewed exclusively by Grantland, and eight of those teams lost $13 million or less. Silver said Monday the league will review its revenue-sharing system, and those losses don't factor in rising team valuations and other revenue streams.
via How the NBA's New TV Deal Could Blow Up the Salary Cap «.
But both of these perspectives assume something that's just hard to believe: The owners wouldn't pursue a greater gain in revenue share from a position in which they have leverage. The players haven't mounted a significant challenge to the league in decades. They're disjointed, lack committment and have a hard time organizing conference calls and press conferences, much less a substantial, tactical response to negotiating aggression from 30 of the most powerful men (and they are all men) in the country.
So until there's some public sign, either from the league's office, the owners' side, or the players that there is a genuine chance a lockout can be avoided... maybe you should keep your calendar open for 2017 and not assume you'll be spending your money on season tickets.
The final word, from Ken Berger of CBSSports.com:
Both Silver and Leonsis dodged the question of whether all 30 teams are expected to be profitable by the time the owners and players can opt out of the current CBA in 2017.
"I'm sure both sides will be studying this new deal and seeking to assure that it remains a fair deal to both sides," Silver said.
The next frontier, according to a person with intimate knowledge of the league's labor negotiations, is an old frontier: a hard cap. With so much money entering the system, some owners might want to "push for a hard cap even further," the person said. Owners may also push for spending exceptions, such as the two-tiered mid-level exception and the bi-annual exception, to become things of the past. With the cap going from $63 million to $91 million, who needs exceptions, the league might argue? To which the players might respond: With so much money coming in, who needs a cap at all?
Of course, National Basketball Players Association executive director Michele Roberts weighed in with a statement Monday, saying that the new broadcast deals were "good news for all of the stakeholders in the business of the NBA." But she added, "Our job will be to ensure that the players receive their fair share ... and that we do everything possible to maintain the growth and popularity of the game."
In return for a hard cap, one NBA labor expert predicted that the league might offer to increase the players' share of revenues as a bargaining chip to achieve the only victory it was not able to check off during the 2011 lockout: an NFL-style hard cap. As the NBA's commissioner emeritus, David Stern, might say, life is a negotiation.
via NBA enters new stratosphere with TV deal, but how will pie be split? - CBSSports.com.
Basketball Hot News
Carmelo Anthony says he never thought about NBA’s new TV deal when re-signing with Knicks
When LeBron James left the Heat to return to the Cavaliers this summer, he only signed a deal that is for a maximum of two seasons — and the second year is a player option.
It wasn’t because James has any intention of playing the free agent market on an annual basis (thank god). It was because he’s looking to make as much money as possible.
James was well aware of the impending new broadcast rights deal, which became official on Monday and featured numbers more astronomical than had previously been projected. The salary cap will skyrocket, and James knows that max contracts will, as well. He wants as big a piece of that pie as the market will allow, and being the game’s best player and one who immediately makes any team a championship contender, he deserves it.
But all players don’t feel the same way.
Carmelo Anthony could have signed a similar two-year deal when he re-upped with the Knicks. He, however, was content with taking five years worth of guaranteed money near the current league maximum.
From Ohm Youngmisuk of ESPN New York:
“I never thought about it,” Anthony, speaking after Knicks practice, said about taking a shorter contract. “I never thought about a two-year deal. I didn’t want to have to go back and do what I did this summer, not at all.”
Anthony re-signed with the New York Knicks during the summer to a five-year, $124 million deal. The new television contract takes effect starting with the 2016-17 season. …
“I signed my deal. I’m good. The organization is good,” Anthony said. “We moved forward and everybody is in a good place. So I don’t think there’s even no need to discuss it.”
Anthony is in a slightly different phase of his career than is James. At 30 years of age and after having played 11 NBA seasons, he may be headed for a decreased level of production over the next couple of seasons, and may not have been able to maximize his earnings more than he could with a five-year deal right now.
Anthony has already amassed over $135 million in career earnings, and his new contract will come close to doubling that. It’s more than likely that he won’t have any regrets.
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