Rumors: NBA will likely lose 2011-2012 NBA season

MeloforMayor

BALL DON'T LIE
NBA Players Association executive director Billy Hunter said Wednesday that if he "had to bet on it," he would wager that the entire 2011-12 season would be wiped out by the lockout. "We're $800 million apart per year," Hunter told about 200 people during a seminar at a conference in Baltimore of the National Bar Association, an organization of predominantly African-American lawyers and judges.

The union chief said NBA commissioner David Stern was being limited in negotiations by hard-line owners.

"The circumstances have changed among his constituency," said Hunter, the executive director since 1996. "In the last six or seven years, there is a new group of owners to come in who paid a premium for their franchises, and what they're doing is kind of holding his feet to the fire."

via Jeff Barker of The Baltimore Sun :(
 

Oldtimer

Rotation player
What about 2012-2013

Let us assume that the 2011/12 season is lost, an assumption that is apparently not at all outlandish. Then what happens? Everyone seems to expect that after the loss of one season, each side will be more reasonable. Perhaps, but I think the owners are banking on the players' willingness to make the substantial concessions.

It seems absurd to throw away a year and only then get serious. The owners and the players are playing chicken with each other. Is either side seriously willing to jettison two or more seasons?

If the players are willing to lose a year, what about a second year? Same thing for the owners. What is going to change next year besides the attitude of the fans?

The players have shorter windows for making money than the owners, but not having games does not eliminate an owner's debt service or the likely diminution of the asset value of the franchise.

The major sticking point at this time appears to be the percentage split of the basketball related income pie. It had been 57% for the players and 43% for the owners. What about a split with the greater of a guaranteed $2 billion or a 50-50, or other, split of basketball related income for the players with a continuing increased percentage for the players as the basketball related income passes a certain number. This would assure that the players would not lose out entirely if five years from now some extraordinary television deal is brokered.
 
Let us assume that the 2011/12 season is lost, an assumption that is apparently not at all outlandish. Then what happens? Everyone seems to expect that after the loss of one season, each side will be more reasonable. Perhaps, but I think the owners are banking on the players' willingness to make the substantial concessions.

It seems absurd to throw away a year and only then get serious. The owners and the players are playing chicken with each other. Is either side seriously willing to jettison two or more seasons?



If the players are willing to lose a year, what about a second year? Same thing for the owners. What is going to change next year besides the attitude of the fans?

The players have shorter windows for making money than the owners, but not having games does not eliminate an owner's debt service or the likely diminution of the asset value of the franchise.

The major sticking point at this time appears to be the percentage split of the basketball related income pie. It had been 57% for the players and 43% for the owners. What about a split with the greater of a guaranteed $2 billion or a 50-50, or other, split of basketball related income for the players with a continuing increased percentage for the players as the basketball related income passes a certain number. This would assure that the players would not lose out entirely if five years from now some extraordinary television deal is brokered.

Might be a retarded question, but: The players still get paid during the lockout? Or is their salary frozen until the league resumes?

If they still get paid, be prepaired for the longest lockout in the history of sports. Guys like Kobe, Melo, Durant etc. will enjoy their time in China, Europe - while still getting their NBA paycheque every month.
 

NYallDay

Benchwarmer
not a 100% on this but i believe they basically forfeit the season from their contract as well as the salary. so in other words, they dont get paid and they lose a year off their contracts.


Might be a retarded question, but: The players still get paid during the lockout? Or is their salary frozen until the league resumes?

If they still get paid, be prepaired for the longest lockout in the history of sports. Guys like Kobe, Melo, Durant etc. will enjoy their time in China, Europe - while still getting their NBA paycheque every month.
 

tiger0330

Legend
Of course they don't get paid, that's why Hunter counciled the players before the lockout that they should be saving their money. I read Stern himself won't be paid during the lockout.

Another reason it may be a long lockout is there are other places for the players to ball like China and Europe, it's not NBA money but it's decent money.
 

knickscity

Benchwarmer
They don't get paid, and their contracts are based from the dates signed.

Wouldn't be a real lockout if those factors were not in place.
 
Thanks for the answer folks!

That's pretty bad for guys like Fields, Douglas, Walker etc. then. They're not $ 100 million guys, don't even feature in commercials.

They're not struggling, cause 500K that Fields made last years is pretty ok to live from 2-3 years, but after that he needs to get a permanent job at Modell's :teeth:
 

Marek

Benchwarmer
The owners obviously don't want to devalue their NBA assets. But it's not their livelihood. They make money in other businesses and will keep up their lifestyles. The reason they would be willing to forfeit an entire season is because they are truly losing money. The system is out of control, they can't control spending and salaries, small markets are not surviving, and the players are pretty much running the front offices. Enough, apparently, is enough.

Most players don't have side income or endorsement deals. They might have to pick up cheap jobs: a local endorsement here, a b-ball camp appearance there, etc. They can't possibly survive as long as the owners can.

The question is this: is the failing NBA model the players' fault? If not, is it fair to take from the players in order to feed the weaker franchises? I don't have the answer. But I do suspect that that is the easiest outcome, and the players will not have the solidarity or fortitude to holdout longer than the owners.
 

Oldtimer

Rotation player
Marek's Observations

Marek's points are well taken. I believe the owners -- at least enough of them to bind them all -- are prepared to lose a season but with the expectation that the players will thereafter quickly fold and make major concessions that will last the next ten years.

I do not know the details, but I assume the owners' current demands are rather outrageous, though I find it hard to believe that they want an $800,000,000 a year deduction in players' compensation. But the players have hardly budged. I feel the players should make some significant movement in their demands. I have little doubt that they can get a better deal this year than they will next year. If a year is lost, everbody loses -- particularly the fans.

Of course,it is likely that what I am preaching is precisely why the owners are hard balling. Perhaps the principal question is whether the owners are truly willing to lose a full year. I think they are.
 

iJoe

Rotation player
The ONLY ones that lose out are the fans.

How about both sides take less money, charge a bit less for those ridiculous ticket costs and spend more money on creating jobs and improving the NBA experience? I'm sure that's something the public can get behind and grow the fans base instead of 2 sides fighting over millions.

Course, that would never happen, but one can daydream.
 
The ONLY ones that lose out are the fans.

How about both sides take less money, charge a bit less for those ridiculous ticket costs and spend more money on creating jobs and improving the NBA experience? I'm sure that's something the public can get behind and grow the fans base instead of 2 sides fighting over millions.

Course, that would never happen, but one can daydream.

Those sound like the demands that would be included in a fan's strike of the NBA
 

toNYknicks

Benchwarmer
An organized fan strike on the NBA doesnt sound like a bad idea!!! we of course put all the money in their pockets we would have major levrage
 

DaTPRiNCE

The Knicks are Back
Might be a retarded question, but: The players still get paid during the lockout? Or is their salary frozen until the league resumes?

If they still get paid, be prepaired for the longest lockout in the history of sports. Guys like Kobe, Melo, Durant etc. will enjoy their time in China, Europe - while still getting their NBA paycheque every month.

basically to answer your question all contracts and salaries are frozen until the league resumes so pretty much melo and stat will have 4 years remaining on their contracts everything is untouched until it resumes
 

knickscity

Benchwarmer
I do not know the details, but I assume the owners' current demands are rather outrageous, though I find it hard to believe that they want an $800,000,000 a year deduction in players' compensation. But the players have hardly budged. I feel the players should make some significant movement in their demands. I have little doubt that they can get a better deal this year than they will next year. If a year is lost, everbody loses -- particularly the fans.

Of course,it is likely that what I am preaching is precisely why the owners are hard balling. Perhaps the principal question is whether the owners are truly willing to lose a full year. I think they are.

That is exactly what the owners want, at least most of them do.

To make it even more telling is the owners want the players to take a 40% pay cut, per year.

The above figure is around 36%.

And to answer your question....yes the owners are prepared to lose a full season.
 

petescud

Starter
I think its sad that these guys make this crazy money and during a recession to boot, and have the audacity to pull this crap...missing a season. They all should be ashamed of themselves
 

nuckles2k2

Superstar
basically to answer your question all contracts and salaries are frozen until the league resumes so pretty much melo and stat will have 4 years remaining on their contracts everything is untouched until it resumes

That's not true. Contracts are written in years, not seasons. If a calendar year passes, a contract year is spent. If there's a full season lost, then that year is wasted because the players didn't get paid, and when the next season resumes they pick it up in the next year of the contract...if there is no next year in the contract then the player is an unrestricted free agent (if he has the correct years of service) or a restricted free agent.

The only way to avoid that is if both sides agree to a stipulation that the lost year "never took place" and resume all contracts as if there was no lockout. If they don't do that, then all players lose a year on their deal.

All of that being said....we' won't miss a full season. All of that is posturing for the public by the negotiating sides, and fear mongering by the media.

The #1 issue is revenue sharing and how poor it is in the NBA. The Knicks BRI (basketball related income) gets a huge shot of steroids right in the ass (no homo) because of the MSG network. The team essentially owns the network, but the network also has the exclusive broadcast rights for the team in it's home market...not SNY, not Comcast sports net, or Fox sports, or anyone else...it's the network that the team essentially owns. So every time you see a "Dial 7" cab commercial, or Rosco the bed bug sniffing dog commercial, that's ad revenue being generated by the network and I believe a cut of that is added to the Knicks BRI for their broadcasting rights. While I obviously don't know the exact numbers...I can tell you that the Knicks make more money with the MSG network than the Bucks do with Fox Sports Midwest, therefore they have a higher BRI, and more money to spend (that's why we were almost always in the luxury tax territory.)

BRI also takes other things into account like 40% of all proceeds from luxury suits. MSG's luxuray suites always have suits & ties in em, and they cost. Other teams have these advantages too, but not many. That's the issue.

The teams without, want a better revenue sharing model that gives them extra skrilla to work with since their BRI isn't as impressive as the big market teams. And while some of these NBA teams are exaggerating how much their losses are, there's no question that there are teams hemorrhaging money like a stuck pig...look at the Maloof family.

Since I don't know what the current revenue sharing model is, I dunno how these small market teams want to alter it to make it better for them...but one thing I do know is that the big market teams...the ones with the money and high BRI, are saying "why the **** should we give you guys any more money??" So the divided owners (those with cheddah, and those without cheddah) come together against a common enemy...the players. "Give back 40% of your money....every single year for the next half decade...and we won't work out the issues among ourselves, kay?" And the players are looking at the owners like ":td:" cause that's not happening.

So...the closer it gets to the season, the pressure is on the owners who can't afford to miss a season....because they can barely afford to even operate during a season...and the players. Despite all the posturing in the media...teams can't afford to miss a season. Check it out, the Celtics' owner doesn't even own TD Garden...they rent it, and they recently extended their lease thru 2021. Rent is rent, whether or not you're actually on the premises means jack shit..you gotta pay your rent. So if there are not ticket sales, no concession sales, no cash-flow from any parking arrangements...but there's still rent to pay...why would an owner sit back and say ":shrug: no season? no problem"

Cash rules everything. And when cash isn't being deposited but cash is being withdrawn, those owners will cave and something will get done. My money is on the owners without, who end up loosening up on some of their demands. The players might give back some money in a new salary cap model, but it won't be as much as the owners are asking for.
 
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nyk_nyk

All Star
That's not true. Contracts are written in years, not seasons. If a calendar year passes, a contract year is spent. If there's a full season lost, then that year is wasted because the players didn't get paid, and when the next season resumes they pick it up in the next year of the contract...if there is no next year in the contract then the player is an unrestricted free agent (if he has the correct years of service) or a restricted free agent.

The only way to avoid that is if both sides agree to a stipulation that the lost year "never took place" and resume all contracts as if there was no lockout. If they don't do that, then all players lose a year on their deal.

All of that being said....we' won't miss a full season. All of that is posturing for the public by the negotiating sides, and fear mongering by the media.

The #1 issue is revenue sharing and how poor it is in the NBA. The Knicks BRI (basketball related income) gets a huge shot of steroids right in the ass (no homo) because of the MSG network. The team essentially owns the network, but the network also has the exclusive broadcast rights for the team in it's home market...not SNY, not Comcast sports net, or Fox sports, or anyone else...it's the network that the team essentially owns. So every time you see a "Dial 7" cab commercial, or Rosco the bed bug sniffing dog commercial, that's ad revenue being generated by the network and I believe a cut of that is added to the Knicks BRI for their broadcasting rights. While I obviously don't know the exact numbers...I can tell you that the Knicks make more money with the MSG network than the Bucks do with Fox Sports Midwest, therefore they have a higher BRI, and more money to spend (that's why we were almost always in the luxury tax territory.)

BRI also takes other things into account like 40% of all proceeds from luxury suits. MSG's luxuray suites always have suits & ties in em, and they cost. Other teams have these advantages too, but not many. That's the issue.

The teams without, want a better revenue sharing model that gives them extra skrilla to work with since their BRI isn't as impressive as the big market teams. And while some of these NBA teams are exaggerating how much their losses are, there's no question that there are teams hemorrhaging money like a stuck pig...look at the Maloof family.

Since I don't know what the current revenue sharing model is, I dunno how these small market teams want to alter it to make it better for them...but one thing I do know is that the big market teams...the ones with the money and high BRI, are saying "why the **** should we give you guys any more money??" So the divided owners (those with cheddah, and those without cheddah) come together against a common enemy...the players. "Give back 40% of your money....every single year for the next half decade...and we won't work out the issues among ourselves, kay?" And the players are looking at the owners like ":td:" cause that's not happening.

So...the closer it gets to the season, the pressure is on the owners who can't afford to miss a season....because they can barely afford to even operate during a season...and the players. Despite all the posturing in the media...teams can't afford to miss a season. Check it out, the Celtics' owner doesn't even own TD Garden...they rent it, and they recently extended their lease thru 2021. Rent is rent, whether or not you're actually on the premises means jack shit..you gotta pay your rent. So if there are not ticket sales, no concession sales, no cash-flow from any parking arrangements...but there's still rent to pay...why would an owner sit back and say ":shrug: no season? no problem"

Cash rules everything. And when cash isn't being deposited but cash is being withdrawn, those owners will cave and something will get done. My money is on the owners without, who end up loosening up on some of their demands. The players might give back some money in a new salary cap model, but it won't be as much as the owners are asking for.

Damn good post. Obviously there are other issues to be resolved, but this pretty much explained the most important sticking point.
 

Marek

Benchwarmer
So...the closer it gets to the season, the pressure is on the owners who can't afford to miss a season....because they can barely afford to even operate during a season...and the players. Despite all the posturing in the media...teams can't afford to miss a season. Check it out, the Celtics' owner doesn't even own TD Garden...they rent it, and they recently extended their lease thru 2021. Rent is rent, whether or not you're actually on the premises means jack shit..you gotta pay your rent. So if there are not ticket sales, no concession sales, no cash-flow from any parking arrangements...but there's still rent to pay...why would an owner sit back and say ":shrug: no season? no problem"

Cash rules everything. And when cash isn't being deposited but cash is being withdrawn, those owners will cave and something will get done. My money is on the owners without, who end up loosening up on some of their demands. The players might give back some money in a new salary cap model, but it won't be as much as the owners are asking for.

Great post; I agreed with everything except your conclusion. Yes, the owners are losing money without a season, but big businesses can stand to absorb short-term losses for a long-term gain down the line. The owners & decision makers still have income, and their lifestyles won't be affected much (if at all) by one lost season. On the other hand, the players will be greatly affected. Every paycheck missed will cut into their savings and lifestyles, unless they've been living well below their means or they've been making top dollar all along.

Right or wrong, the owners have the resources to absorb a long lockout much, much better than the players...expenses and all.

And philosophically speaking, I can't really blame the owners for demanding a bigger share of BRI from the players. Afterall, it's their league. If there are teams losing money, it's a bad business model. Penalizing a big market to artificially keep a smaller market afloat isn't great business. Either get the smaller market profitable (more BRI from players) or kill it (contraction).

Personally, I'd like to see them kill the NOH. It's unowned, it's losing money, and frankly, there's not enough talent in the NBA to stock this many teams. If they could just find one more team from the East to cut, it would probably solve a lot of problems. But nobody wants that.
 

Oldtimer

Rotation player
Nuckles & Marek

Excellent posts by Nuckles and Marek. The fans and the players need a league with many teams spread throughout the country. This gives the players employment opportunities and increases the fan base. Who wants a ten team league? But there are only so many truly good franchise locations There should be some revenue sharing to assist the smaller market teams.

I do not believe that the owners are against revenue sharing. However, it appears that the revenue the owners want to share among themselves is the revenue they now seek to take from the players.

The owners want to separate the percentage of revenue pie they want vis a vis the players on the one hand and what they will do about revenue sharing after the pie is split on the other hand. It appears that the prinicipal current problem is the revenue split. I think that hard-caps, flex-caps, contract lengths, max contraacts etc. are side issues, but related side issues. Once a revenue split is determined, the other issues will tend to fall into place. What difference will a hard cap make to player compensation if the players are guaranteed a percentage of BRI? If we can assume a BRI pie that is stable or continues to grow, it is the percentage of the BRI pie they end up getting that will determine how much the players will make.
However, it now appears that the owners want a split that will plainly diminish substantially overall player compensation.
 
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