Official CBA/Labour Talks Discussion Thread II

[Fairview4Life]

Why did you cut the rest of my quote? "So it might have been 250 million but certainly not a profit."

Again, the players themselves who have access to reams of financial data have acknowledged that the league lost money. Yet you think you know more than their legions of accountants poring over that data?

Because a 250 million loss is also almost certainly not true either. The players have said a small number of teams lost money, sure. I'm not sure why that is a bad thing though. Some teams should have lost money.

If the union agreed with you they wouldn't have dropped from 57% to 52.5%. There's no way.

The union does agree with me, according to their own words, and yet they were willing to give up a lot of money in order to get a deal done anyway. The whole "if the owners hold out it means they're right" or "if the players give anything up it means the owners are right" conclusions are specious.

[ranger001]

Because a 250 million loss is also almost certainly not true either. The players have said a small number of teams lost money, sure. I'm not sure why that is a bad thing though. Some teams should have lost money.

The union said 8 teams lost money. That's over a quarter of the league. And that's only because they don't think that depreciation is a legitimate expense. When you buy a scoreboard you can't expense it in one year it has to be depreciated over multiple years. Give me a reason why you shouldn't depreciate a scoreboard over multiple years.

And the lockout is not about what you personally think is a bad thing, if the owners think that 50% (25% for you) of the teams losing money on a multimillion dollar investment is bad then they are going to fix it. What you think is bad or good is inconsequential.

As I've said before if it was your multimillion dollar investment that you had to put cash into every year then you'd think differently.

[I_Like_Dirt]

The owners have been asking for way more than fixing the system, ranger. This is entirely about them out to get as much money as possible. Honestly, this is also about the wealthy teams reading the tea leaves and realizing that either they push the small market 'rivals' towards a messy labour dispute to try and legislate themselves profitable, or the see those same small market teams come after their massive profits in revenue sharing and they know they don't really have a leg to stand on if it comes to that point.

That said, do you think the Bobcats and Hornets actually should have made money last year based on the way they were and have historically been operated?

[ranger001]

People think the problem with the system is that dumb GMs give out dumber contracts. The real issue is that you need to take a chance to win and if those chances work out wrong then you are screwed (losing money).

Amare Stoudemire got a huge contract and his knee was ok so that GM was smart but Arenas' knee has not recovered so that GM is dumb.

To fix the system the owners still want to take a chance but they want to still make a profit if it doesn't work out. That requires 3 things, a BRI change, revenue sharing and a change to the rules allowing mistakes to be undone sooner. Any one of those things is not enough.

[Salted Meat]

http://espn.go.com/blog/truehoop/post/_/id/32834/how-small-market-owners-took-control

A couple of days before the start of training camp in 2006, David Stern received an uncomfortable letter at the NBA’s New York offices.

Eight owners signed a petition that demanded Stern address the small market/big market financial disparity they felt was a serious and growing problem. Obviously, they didn’t need to write him a letter like he was their local representative in Congress; he works for them. They did so to make a symbolic point and then released the letter to some media outlets to make sure the issue became public.

It read: “We are asking you to embrace this issue because the hard truth is that our current economic system works only for larger-market teams and a few teams that have extraordinary success on the court and for the latter group of teams, only when they experience extraordinary success. The rest of us are looking at significant and unacceptable annual financial losses."

The authors of the letter were Paul Allen of Portland, Herb Simon on Indiana, Bob Johnson of Charlotte, George Shinn of New Orleans, Larry Miller of Utah, Michael Heisley of Memphis, Glen Taylor of Minnesota and Herb Kohl of Milwaukee.

The NBA’s last collective bargaining agreement was ratified in 2005 and included an increased piece of the pie for the players in the form of a jump to 57 percent of basketball-related revenue. Just a year later, those eight teams that drafted the ’06 letter were already complaining openly to Stern that it wasn’t working for them.

In his podcast with Bill Simmons on Monday, union president Billy Hunter re-told a story about meeting with Stern during the 2007 NBA Finals in Cleveland, nine months after Stern received that letter. At the time, Hunter said, Stern talked about the need to roll back the players’ share and revealed his owners were already talking about locking out the union in 2011 if their demands for givebacks weren’t agreed to.

That was two years before an economic crisis slammed the country and further hammered the bottom lines. Since then, the number of allies for the eight owners who wrote the letter has only increased, and it has shaped the dynamic in both talks with the union and with big-market owners.

“That Lakers’ TV deal scared the hell out of everybody,” one league official said. “Everyone thought there is no way to compete with that. Then everyone started thinking that it wasn’t fair that they didn’t have to share it with the teams they’re playing against.”

Pile all of those factors together and you have a faction of owners in 2006 that has turned into a majority in 2011. They are furious that the players are getting paid so much. They are furious that the NBA's current revenue sharing ($60 million a year) is worth less than half of a league like the NHL ($137 million). And they are trying to take advantage of throwing their new weight around.

A must read. I'd quote the whole article if it weren't against the TOS.

[I_Like_Dirt]

How does a BRI change, or even revenue sharing, allow teams to continue taking chances after making a mistake on Arenas. I agree with allowing mistakes to not kill a team for as long.

Some revenue-sharing and BRI changes are needed. How much of either one is what is currently causing the labour dispute. The owners are essentially fighting for a piece of the pie so large that they don't really need much revenue sharing at all despite the fact that the other leagues they use as examples of what they want already both have revenue sharing in a much more significant way than the NBA currently has, or appears interested in discussing. A change in BRI will only be a temporary fix. In the end, it's the disparity in income of the teams that is at the heart of the matter. Revenue-sharing needs to come in a big way.

[ranger001]

How does a BRI change, or even revenue sharing, allow teams to continue taking chances after making a mistake on Arenas. I agree with allowing mistakes to not kill a team for as long.

Some revenue-sharing and BRI changes are needed. How much of either one is what is currently causing the labour dispute. The owners are essentially fighting for a piece of the pie so large that they don't really need much revenue sharing at all despite the fact that the other leagues they use as examples of what they want already both have revenue sharing in a much more significant way than the NBA currently has, or appears interested in discussing. A change in BRI will only be a temporary fix. In the end, it's the disparity in income of the teams that is at the heart of the matter. Revenue-sharing needs to come in a big way.

Number one on the list is that the NBA wants every team to make a profit. That cannot be done with just revenue sharing since the league lost 300 million, even the players acknowledge that the league lost money, they don't agree with 300 million but they agree that the league lost money. Thats the reason for the BRI change.

Now Arenas is a different issue, the rules need to be changed so that if you take a chance on a guy it doesn't hurt you for 6 years. So lets say its 3 years of guarantees, that means after 3 years you can take a chance on a different guy.

[Fairview4Life]

Because a 250 million loss is also almost certainly not true either. The players have said a small number of teams lost money, sure. I'm not sure why that is a bad thing though. Some teams should have lost money.

The union said 8 teams lost money.

They did? The quotes i have seen are "a small number". Other sources have said 8 or 9, or 10 or 11. And that includes teams like the Mavs and Magic who are doing so on purpose because they don't care.

[J-Roc]

Why wasn't Arenas's contract just cancelled? Seems the rules are already in place, but no one ever wants to test them out in court.

[Indeed]

There are 2 cases that owner will not lose money:
1) 47% or even 50% on RBI
2) Revenue sharing between owners, 57% on RBI

The league as a whole lose 300 million last year. So it might have been 250 million but certainly not a profit.

Not even the players believe that the owners will make money in case 2, they have agreed to go down to 53%, yet you persist with this nonsense that the owners are making money at 57%. You have not seen the financial data that the players have and yet you know more than them? Do you have any financial training at all.

Someone posted the financial data in the previous conversation, didn't you read them?
Instead of questioning other people's information, which has already been posted between the conversation with Fairview, Sleepy and Boris, why don't we continue with those conversation there, rather than start all over from zero and just to explain to you alone to where we had agreed up to?

[ranger001]

Because a 250 million loss is also almost certainly not true either. The players have said a small number of teams lost money, sure. I'm not sure why that is a bad thing though. Some teams should have lost money.

The union said 8 teams lost money.

They did? The quotes i have seen are "a small number". Other sources have said 8 or 9, or 10 or 11. And that includes teams like the Mavs and Magic who are doing so on purpose because they don't care.

Of course they care but they want to win so they lost money to try to win. But the change in rules that the other owners want is that they should not be allowed to lose money on purpose. It puts other owners at a competitive disadvantage if they refuse to lose money. The fact is that they lost money.

Again, your opinion on who should be allowed to lose money is your opinion. It has zero impact on what the owners will do.

As for the union, here is a summary of an interview:-

7-8 teams lost money last year, not 23 like the league says. All teams combined lost about $160-170 million last year, not $300 million like the league says.

Billy Hunter and David Stern: Fact Check

[theonlyeastcoastrapsfan]

Because a 250 million loss is also almost certainly not true either. The players have said a small number of teams lost money, sure. I'm not sure why that is a bad thing though. Some teams should have lost money.

The union said 8 teams lost money.

They did? The quotes i have seen are "a small number". Other sources have said 8 or 9, or 10 or 11. And that includes teams like the Mavs and Magic who are doing so on purpose because they don't care.

I think this is a big misconception. The owners, I'm sure care. I'd guess they feel that doing all they can to be competitive should not mean taking heavy losses. They aren't losing money on purpose because they don't care. The magic have an old owner who wants to try and win before he dies, they also want to try and keep Dwight Howard, I'm sure they'd prefer to be able to does these same things and not take heavy losses, but unless you're the Knicks or Lakers - that's just not happening. Paul Allen, for as much as he's been skewered by basketball media, who have essentially been exposed as shills for their agent sources during this process, looking at you Woj (remember he get's his rep by getting the scoops, he get's the scoops from agents, and he's been paying them back all summer and fall with Stern the Bully, Paul Allen a 23 year owner, and Woj is going to write an article wiht now sources indicating he's about cut and run, and he's done an about face, when in actuality he's been on the record with this point of view since 2006, but I digress) they may try and do all they can to put a competitive product on the floor. they may feel they have to do that to the fan interest in the market hot, and not take steps backwards, but that doesn't mean they don't care that trying to compete in the NBA means losing money. It just means they've chosen, for their reasons to do all they can to be competitive despite the losses. Just becasue I chose to buy something that was overpriced, does not mean I don't care about the cost, or wouldn't like to see it lower.

You can say, the Spurs and Thunder, but that's about drafting Durant, and Drafting Duncan. It's not all about shrewed management, and there's only so many of those players around. And seeing the trend of super star players feeling the need to play with other superstar players, I'm sure many around the league management are fearing such trends will make it near impossible, for the 20 or more teams that are left out of the arms race.

[Indeed]

People think the problem with the system is that dumb GMs give out dumber contracts. The real issue is that you need to take a chance to win and if those chances work out wrong then you are screwed (losing money).

Amare Stoudemire got a huge contract and his knee was ok so that GM was smart but Arenas' knee has not recovered so that GM is dumb.

To fix the system the owners still want to take a chance but they want to still make a profit if it doesn't work out. That requires 3 things, a BRI change, revenue sharing and a change to the rules allowing mistakes to be undone sooner. Any one of those things is not enough.

1) You don't need to change RBI to do that. Even the RBI is 1%, you may still offer max contract to some players, and your team is still in trouble. I really think you have a problem understanding this, it has nothing to do with RBI.

2) Revenue sharing has nothing to do with the players, so why transfer the issue into the player side and having a lock out?

3) Good GMs can undone mistakes, and could you explain why GM got paid so much? They are hired to make mistakes? Why not I be the GM then? This is not gonna happen, you need to take your responsibility with you, that is business, no bail out.

[ranger001]

Indeed, Why was a rookie scale instituted?

What I believe is that you have a problem understanding the purpose of the rules. That's the reason you are not a GM.

[Indeed]

Why did you cut the rest of my quote? "So it might have been 250 million but certainly not a profit."

Again, the players themselves who have access to reams of financial data have acknowledged that the league lost money. Yet you think you know more than their legions of accountants poring over that data?

Because a 250 million loss is also almost certainly not true either. The players have said a small number of teams lost money, sure. I'm not sure why that is a bad thing though. Some teams should have lost money.

If the union agreed with you they wouldn't have dropped from 57% to 52.5%. There's no way.

And dropping to 53%, and it is still no?
Wouldn't the owner has their responsibilities as well? And I still would like to know what expenses they have is causing them to lose money if they are getting more revenue.

Recession or not, they are making more money, and they said they are losing more money? Do you believe that? And if it is in a recession, I am sure you can hire cheaper maintenance people, get a lower interest rate, and etc., no?

[Indeed]

Indeed, Why was a rookie scale instituted?

What I believe is that you have a problem understanding the purpose of the rules. That's the reason you are not a GM.

So you are saying all the GMs there understand the purpose of those rules? They are also expect of basketball game?

[ranger001]

Indeed, Why was a rookie scale instituted?

What I believe is that you have a problem understanding the purpose of the rules. That's the reason you are not a GM.

So you are saying all the GMs there understand the purpose of those rules? They are also expect of basketball game?

Yes GMs understand the rules of the CBA. That's why we don't have a freaking season going on right now.

[Indeed]

Indeed, Why was a rookie scale instituted?

What I believe is that you have a problem understanding the purpose of the rules. That's the reason you are not a GM.

So you are saying all the GMs there understand the purpose of those rules? They are also expect of basketball game?

Yes GMs understand the rules of the CBA. That's why we don't have a freaking season going on right now.

I understand the rules, doh.
As I said, you only say things based on your own knowledge, but I read other reference, I learn from other posts.

Have you read the conversation between Fairview, Sleepy and Boris? Do you think they are irrelevant?

[ATLTimekeeper]

http://sheridanhoops.com/2011/10/26/lockout-update-no-50-50-precondition/

I guess the revenue sharing meeting was fruitful enough for them to move forward. I think the owners will try and trade % for concessions on this lux tax.

[ranger001]

I understand the rules, doh.
As I said, you only say things based on your own knowledge, but I read other reference, I learn from other posts.

Have you read the conversation between Fairview, Sleepy and Boris? Do you think they are irrelevant?

Yes I read it and as I said before ebitda is NOT net profit. Sleepy admitted that, did you read that? Do you know why ebitda is not net profit? You think taxes don't have to be paid?