“Michael Jordan is a sellout!”, The Lost Season and Other Thoughts on the NBA Lockout

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Decertification, Ultimatums and BRI. Not exactly the sort of basketball news you’d expect to be reading about in October. The Great War of Billionaires vs. Millionaires has moved on to the next stage, a nasty PR nightmare with a potentially nastier outcome: A LOST SEASON.
I say bring it on.

Our own resident team owner, G.O.A.T. and Global Icon Michael Jordan, has over the past week been cast as the quintessential hardline antagonist — the Severus Snape, turning against his own at Hogwarts. He’s been subsequently made the media’s whipping boy as he dared turn his back on the players in search of greedy profits…“MWUA-HA-HA!”

Too bad because MJ is absolutely, positively right on this. This is Anti-Kwame Logic. Anti-AMMO. He should be applauded for his perseverance and foresight. He should be celebrated. But he’s not. Let us look at the reasons why…

PART I: The Lost Boys.

A quick list of those effected by a potentially LOST SEASON:

1. The Fans. NBA basketball is great. I love it. I’ve devoted a ridiculous amount of hours in my life to it. From Tripucka to Biyombo. From Salt ‘N’ Peppa on Inside Stuff to salt and pepper in my beard. I sometimes write about it. I don’t get paid a dime. In fact, I spend a chunk of my income just to catch the games. I’m like a lot of you out there. Busy with life, goals to be achieved, work to be done. Watching hoops is a great cherry on top at the end of the day during those dark winter months. But that’s it. It’s just the cherry. The whipped cream, nuts, fudge, and two scoops are still there. We will find other cherries during a lost season.
VERDICT: MINIMAL EFFECT.

2. The Owners. This a diverse group ranging from ultra-achievers like Mark Cuban to professional scumbags like Donald Sterling. Two major things in common: WEALTH and NON-BASKETBALL RELATED INCOME. The outside income also brings outside interests. These guys love basketball, sure, but they didn’t achieve this level of wealth sitting on their asses waiting for TNT Thursday Nights. Even Jimmy Dolan has to run a massive telecom business. They have plenty to keep themselves occupied with and financially comfortable during a lost season.
VERDICT: MINIMAL EFFECT.

3. The Players. So let me get this straight, Kevin Garnett marches into a safe, public environment (conference room) and stares down slash yells at people who he knows won’t fight back? Hmmm…KG would never do that on the court now, would he?
For every KG or Kobe or Paul Pierce — guys who’ve pocketed near or over nine digits during their playing careers — there are ten times as many Stephen Grahams, D.J. Whites and Kemba Walkers. Guys who haven’t struck it rich on a big contract or, in Kemba’s case, haven’t been paid a dime. Unless Garnett, Kobe and Pierce start handing out game week checks to all of the other players who pass them the ball then I doubt there’ll be a happy players coalition for much longer.
VERDICT: MAJOR EFFECT

4. The Agents. Blll Simmons brought this up a few weeks ago and nobody else picked up on it (for reasons I’ll get to soon enough). The agents get paid on percentages. A lower BRI percentage combined with a “flex cap” results in agent fees going down. Top that off with an end to sign-and-trades with limited Bird Rights and agents lose BIG in what would amount to an INVERSE Tony Montana Equation: “First you lose da money. Chu lose da money, then you lose da power.”
The halcyon days of agents strong arming teams into dealing or signing players? Long gone friends. If Stern, Jordan and company are acting to neuter the agents in order to prevent a MLB Scott Boras situation from ever occurring, then I stand and applaud. NEWSFLASH: Agents do not act in or care about the best interest of the fans (aka NBA’s customers). Starve the leeches gentlemen.
VERDICT: MAJOR EFFECT

5. The Media. This, folks, is the wagon driving the cart. The guys who cover the NBA for a living, many of whom I admire, are ABSOLUTELY dependent on the NBA playing a season. These guys make less than Stephen Graham. They have mortgages. They have families. Their future prospects are wholly dependent on how popular the NBA is. They don’t want the season to be cancelled and in some cases, can’t afford for it to be. Their employers could potentially furlough them without pay. The overextended could find themselves in financial ruin.
While this is very sad and I do feel for these individuals, I can’t help but wonder if their own circumstances have colored their reporting. We should keep this in mind as we read the news coverage.
VERDICT: MASSIVE EFFECT

PART II: Why Michael Jordan is Right.

Cancel out all the noise and you can find the lockout’s seminal question: “Is the NBA a business or is it not?” The owners put up the non-guaranteed capital at a risk and in turn receive a profit or are burdened by loss. The players guaranteed salaries are wholly dependent on the Association’s infrastructure to package and deliver the basketball product. Without a majority of the world’s best players, the NBA could no longer charge for a world-class product. They must strike a healthy balance between operational cost and product quality. Simple.

The fundamental difference between the two sides is that the players don’t see the Association as being a business but as a “Mega-Agency”. They conveniently forget that agents take money off the top and are paid regardless whereas the Association must generate all income with little to no guarantee of profit. They run a business, the players are professional salarymen. The risk/reward ratios are currently unbalanced. MJ and the other hardline owners want to stand pat until the balance is within reason. Of course not all owners are created equal. Some of the mega-rich see their teams as luxury yachts to be flaunted. Still, in the end, we are dealing with businessmen and while they may be accused of being greedy, they aren’t stupid and will thus tweak the Association’s business model until it becomes financially sustainable and financially attractive for all.

Ultimately, the owners will win this War and the NBA will be much different because of it:

  • Agent powers will be diminished. Maverick Carter and “Worldwide” Wes will go back to being “Those dudes who are always trying to hang out with Lebron.
  • Some players will go overseas to earn more, most will stay here and play harder — incentivized by shorter contracts.
  • Competitive balance will be restored; parity will find more teams hoisting Larry O’Briens.
  • This in turn will create more league-wide popularity, boosting revenue as teams in all markets attract more fans to the arenas for intense, competitive basketball. TV revenues will follow suit.
  • High profit franchises will entice new ownership groups seeking to profit through professional basketball — thus innovating upon the product, improving the experience for fans.

Sit tight Bobcats fans and don’t believe the hype, a Lost Season may hurt short term but long term could elevate a marginal domestic business into an international phenomenon that will yield terrific results for everyone involved.

-ASChin

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9 Responses to ““Michael Jordan is a sellout!”, The Lost Season and Other Thoughts on the NBA Lockout”

  1. Jason
    November 8, 2011 at 10:26 pm #

    Nice column.

    Re: the lockout, I do think you have enough agent/player mega-combos to start their own league if the NBA decides to blow it all up. The barnstorming tour has proved that the stars can still draw in the hardcore fans, if nothing else. AND, they could put a team back in Seattle.

    I also think the owners are risking the loss of fans in already jaded markets like Charlotte, but fans in Oakland/San Francisco and other similar markets are going to pay whether they are watching the Golden State Warriors or Kevin Durant’s Microsoft Supersonics. I also think Jordan risks losing the only free agent draw Charlotte has right now, which is his marketing power.

    And speaking of MJ, I agree that he has a plan, but I still think 1) the Knicks and the Lakers need to share a little love with the small market teams, 2) the owners as a whole need to push the players’ share of the BRI up to 52, which is halfway between where they were and where they want to be (seems fair), and then 3) we can get back to playing ball so I can stop watching hockey!

    • ASChin
      November 8, 2011 at 10:49 pm #

      These are great points Jason.
      I would counter that The Harlem Globetrotters do much the same for a lot less money. Not to mention the fact that most cities have exclusive professional basketball rights with NBA teams in place meaning that very few current NBA cities would be able to host such barnstorming events in large enough venues.

      You are right about the small markets — short term they would be hurt — but long term they would become competitive and would potentially reinvigorate a jaded fanbase.

      Between the agreed upon revenue sharing model and the removal of sign-and-trades, limited Bird Rights and a hard cap, the big market teams will be more or less forced to play by the same rules. Similar to what you see in the NFL. The Giants and Jets have achieved much more success with a “parity” system than the Knicks in a rigged one for much of the decade.

      Lastly, the players are much more of a commodity than they currently realize. If having the very best basketball players on the planet is so important then how do we explain the immense popularity of collegiate sports? The Olympics? Granted, there are multiple factors differentiating the two but ultimately it is The Package of professional basketball that will triumph over absolute quality. Similar to how we no longer buy cars by horsepower measurement, I can foresee a day soon when we don’t care (as much) about which League has the absolute best players but rather which company’s experience of basketball is better.

  2. Jason
    November 9, 2011 at 1:00 am #

    The ‘Band Together’ Hornets think differently about small market fanbases.

    Also, everyone knows the fix is in with the Globetrotters.

    And speaking of the fix, I am definitely down for a ‘which company’s experience of basketball is better’ mentality, but only if Eric Bischoff is involved.

    As for the Olympics, professionals are definitely involved these days, and college players may as well be professionals, at least in the popular programs. I don’t see too many people tuning in to watch Rugged State University play the Ball State Ballers.

  3. Dr. E
    November 9, 2011 at 10:44 pm #

    Gotta ask, what barnstorming tour you guys are talking about? The overseas one that got scuttled because the bigshot in charge couldn’t come up with the money, security, travel logistics, etc. so all the players pulled out?

    The only thing that’s been played this summer are glorified And-1 Tour pro-am games in NYC parks and in small gyms to raise money for players’ vanity charities.

    And though it’s admittedly cool to think about a few agents getting together a renegade league, it’s pure fantasy. Why? In the end, a simple reason: they couldn’t guarantee that they could make money — and no agent is down for that. Besides that, the logistical challenges (arenas, TV, internet presence) would be astronomical.

    I agree with ASChin that MJ has a lot more to gain than to lose by aligning himself with the hardline owners. The suggestion that players won’t want to sign FA deals in Charlotte in the future because of Jordan’s current stance in the negotiations is laughable. Free agency is primarily about money and secondarily about the chance to fit in well on a good team.

    However, the suggestion that players won’t want to sign FA deals in Charlotte in the future because the team might continue to suck, and be mismanaged and capped out is perfectly understandable — because that’s been our reality for several years.

    The new CBA will certainly level the playing field somewhat for small-market/low-revenue teams like Charlotte and Milwaukee to have a greater chance to not suck — just how level remains to be seen. But I don’t think that true NFL-style hard cap/parity can, will, or even should happen in the NBA.

    It’s still going to be up to Jordan, Higgins, and Cho to do a better job drafting, trading, signing FAs, and having coherent short- and long-term plans for the roster. And I’ll have to see it before I believe they can do it.

    Anyways, overall I’m actually a little surprised that the players have held down the fort this long. The owners have won this thing and the players are in the process of capitulating. Deal gets done by this weekend and we’ll have games by mid-December, which is what I’ve been predicting all along.

    • Mike
      November 10, 2011 at 10:22 pm #

      Good points, Dr. E.

      With this whole lockout issue, it’s tough to really get down to who’s going to come out as a winner. I’m not really sure there’s an actual winner – just a systematic “realignment” toward parity/competition.

      I mean it’s clear that the way things were going was not sustainable. It’s was like the top players made 90% of pie and the owners for the big-market teams made 10 times what the other clubs pulled in. Why the hell would the rest of the owners in the league even want to participate in a system like that? I know that the Bobcats have seriously mismanaged themselves (in comparison with OKC), but they aren’t the only club that’s tired of playing the part of the Washington Generals.

      In the old system, the only way to beat the Miami Heat was to spend like Mark Cuban… and Mark Cuban is the only one that can do that. Michael Jordan has no choice but to take this stance. Hopefully, under the new system small market teams have a 1 in 30 chance of winning the championship.

  4. Jason
    November 9, 2011 at 11:24 pm #

    I guess “charity” and “barnstorming” are being used synonymously. But I think OKC and Portland, at least, have proven they are down for watching professional basketball players regardless of the format, and I know many other cities would be as well, especially if the players actually started forming teams. I do think they have done a fine job finding places to play, and most games have been streamed on the internet at the very least.

    I agree that the lockout is almost over, and that the owners have won, so most of this is theoretical. I do think Jordan has done some short-term damage. Hopefully, it doesn’t extend into the long-term, but agents are good at holding grudges.

    • Mike
      November 10, 2011 at 10:30 pm #

      Jason – I think those fans came out for single exhibitions, but I don’t think you could count on them to attend 3 or 4 games a week.

      Anyway, would players just pick where they want to play in this hypothetical new league?

      Perhaps in this new type of league, where the players have all the control, we might see guys like D-Wade, Lebron James, and Chris Bosh join up to play in a big multi-cultural market like Miami. I even bet that players like Carmelo Anthony would be interested in playing with Amare in New York City. Heck, maybe a bunch of guys might be interested in playing with Kobe Bryant on a team in Los Angeles. Of course, every other town would get the second rate guys or whoever they could afford. I’m sure that league would turn out just fine.

      • ASChin
        November 11, 2011 at 7:02 pm #

        I would love to see the players try and build a competitive League of Their Own. Chances for success are somewhat slim unless they unify or find BIG sponsors. In reality, Stern is Vince MacMahon and the players are TNA Wrestling.

        As far as MJ harming CLT’s chances of signing FAs — don’t buy it mainly because CLT never really had any chance at signing Lebron/Wade types to begin with AND the fact that Donald Sterling is infinitely more of a douche than MJ could ever be and he still finds a way to sign the occasional name.

  5. Jason
    November 12, 2011 at 9:05 pm #

    Yeah, but Donald Sterling is in L.A.

    And the Melo/Amare, Wade/Bron/Bosh league just garnered the NBA one of its best years ever.

    I think by building through the draft, and attracting a few of the right free agents, along with a Steph Curry type who just wants to be in Charlotte, the Cats can build a team at least as good as if not better than the Band Together Hornets, and those guys were just a Sam Cassell gladhand away from the Eastern Conference finals.

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