Official CBA/Labour Talks Discussion Thread

[knickerbocker2k2]

And then, just like with all the decertification law suits, it gets thrown out of court... the players just lose even more money and more time and are in an even worse bargaining position.

For one no lawsuit was thrown out. In the case of the NFL what was thrown out was a decision by federal judge that stopped the current lockout. The rulings had no impact on the wider issue of the NFL owners impunity of anti-trust. Fortunately for NFL fans this is moot point since they have come to agreement and we wont' know the decision of upper courts, but if past decisions are to go by NBA players would get ruling stating that NBA would be in violation of anti trust laws if players decertify. The only issue is how long this would drag out in the courts (atleast this season would be ruled out).

The players are screwed. They are not a "weak" employee who needs protecting against a tyrannical owner. They are overpaid, overcompensated crybabies who have no grasp on reality.

Why do owners need protection? If they can't pay, no one is putting gun on their heads. You and I may think that they are overpaid, but the only person opinion on this that matters is the one paying the check and they certainly thought they were worth it.

There will be no ball this year, and the players will finally consent to a slightly less screw them deal.

If the owners are in this camp and are not bargaining in good faith, than the players would be smart to not lose any more time, and decertify. I would certainty take my chances in market that didn't limit my pay or forced me to enter a draft.

[Local_NG_Idiot]

Yes he has an out. He can go back to the NBA. It doesn't change the fact that he'd bet better off taking that out if his NBA salary were 6M a year rather than 16 M a year.

Williams only makes 4 M if he plays an entire year. That's his "market" price for a full year of Pro Ball. He's willing to lace up the shoes and play for 4M a year. So why would the NBA offer him 16 M?

Fair market value in a Turkish league though is relative to what fair market value is in the NBA. If I'm a superstar investment banker, can a small Credit Union offer me the same type of salary that one of the large Canadian banks can?

Note his out is only if the NBA work stoppage is over. It doesn't allow him to simply up and play for any other Turkish league team or even any other Fiba team. That's not the same as what you are proposing.

The proper analogy would be would NBA players accept smaller contracts if they were allowed to leave and sign with Turkish league teams. The answer is NO.

Fair enough, but there have been instances of players taking less in the NBA already if the team is willing to put a player option year in the contract, for example Matt Barnes last season.

He's got that out clause because he feels he can make MORE money in the NBA than in Turkey and doesn't want to miss out on making more money. If the NBA puts the max Salary at 8M wouldn't he still exercise the out clause because 8 M is more than 4m?

He sure would as the NBA is the elite league for basketball in the world, it has the largest revenue stream of any basketball league in the world and it has the largest exposure so that the upper-echelon players have an avenue to build their own "brand" (btw I hate that people now market themselves as a brand).

Now that it is being reported that the BRI for the players came UNDER what their current CBA allows and that the owners owe them money based on revenues it speaks volumes to the fact that as a 30 team league in a poor economy, they have been able to curb their previous spending habits and are self regulating. It brings to the forefront that the imbalance of the league is more in the team revenue sharing stream than it is with an imbalance of player salaries and team revenues.

[Too Late Crew]

Yes he has an out. He can go back to the NBA. It doesn't change the fact that he'd bet better off taking that out if his NBA salary were 6M a year rather than 16 M a year.

Williams only makes 4 M if he plays an entire year. That's his "market" price for a full year of Pro Ball. He's willing to lace up the shoes and play for 4M a year. So why would the NBA offer him 16 M?

Fair market value in a Turkish league though is relative to what fair market value is in the NBA. If I'm a superstar investment banker, can a small Credit Union offer me the same type of salary that one of the large Canadian banks can?
.

I still don't think people are grasping the concept.

If we use your analogy:

The NBA is the Royal Bank (largest in Canada)
The Turkish League is the Credit Union

They both are competing for the same employee.

They both offer the same basic job branch manager with the same basic duties (ie playing basketball)

The Credit Union offers 40 K a year and a partial benefit package plus you need to live near the branch which is in the middle of BFnowhere
The only competition for the Royal Bank for this employee are a whole BUNCH of Credit unions. The Royal bank is the only Bank this big.

The Royal Bank offers a FULL benefit package, they offer branches in the most desirable cities. Does the Royal Bank need to offer 160 K salary and profit sharing to get this manager? No of course not. They can offer 60 K and probably still get him because none of the competing offers is even close. The manger can't get more than 40 K anywhere else but the Royal bank. If they offer 160 K they are bidding against themselves.

What players taking 2,3 4 M a year to play in Europe does it to show that maybe the NBA doesn't NEED to give players 50% plus of BRI. The players have for a long time not really needed to look on the other side of the fence. They will come to realize that not only is the grass not greener on the other side but that the grass on the other side is full of cow dung.

This isn't necessarily about owners sharing revenue among themselves. Its about how big a piece of the pie the have to share. I don't think a lot of players know how good they have it under the current CBA..at least until they look at the alternatives. What alternatives does a guy like Reggie Evans have? Play in Europe for 200K, flip burgers at Mcdonalds or play in the NBA for millions.

I think that the owners realize that they are giving the players too big a piece of the pie and that most of them don't have any alternative that's remotely as lucrative as the NBA even at a big salary cut.

[I_Like_Dirt]

I might be wrong about this (even without this point my general point still stands) but aren't most euroleague contracts reported as net earnings rather than gross earnings, and can't they also include non-monetary bonuses that the NBA doesn't allow? If so, that contract could be the equivalent of a relatively high NBA contract. If owners were going to allow players to terminate their contracts the second a different team was willing to pay him more, some players might start by taking less.

The key point here, too, TLC, is that the euroleague season has fewer games and players play fewer minutes (nobody plays 35+ mpg like all NBA stars do) and their games are only 40 mpg. Essentially, he's going to be playing a lot less basketball for his price as well. A guy like Deron might take the equivalent in the US, but the NBA is going to lose some of its overall value if they aren't careful in negotiations. Players like Valanciunas are going to get higher offers from European teams and won't come over for rookie contracts, and guys like Ginobili and Gasol will just stay over in Europe. The NBA might still be considered the best league, but it won't be considered to have a monopoly on all the best players anymore and that's going to cause some drift over time, especially for players who could just stay closer to home for the same or more money.

Plus, if you're an engineer that works for the world's best engineering firm who is paid a lot more than any other engineers by virtue of actually being the best, and that firm locks you out in order to try and slash your contracts and tries to justify the fact that another employee decided to just go work for somebody else as an engineer for less money for less work as a reason why they should be able to pay the same, you won't exactly be all that impressed, and even if your firm gets the salary demands they want, they'll eventually lose some of the talent they'd accumulated with the salaries they were paying and might start losing out on revenue as the worlds #1 engineering firm.

In the end, the owners may very well get what they want, but that doesn't mean they aren't twisting their numbers in order to try and make a short term revenue. It also doesn't mean that they have the interests of the league as a whole in mind. Most of the owners in the NBA own the team for 10-15 years, the length of which they're allowed to write off the cost of their franchise for tax purposes. Once that happens, they look to sell the team for as big of a profit as they possibly can. These guys are looking for what will get them the most revenue and the highest resale price in the next 10 years at most, not what will result in a long-term solution to the league's problems. If/when the owners get what they want, a bunch of owners (including MLSE, I might add) will sell their teams for more than they would have gotten without the agreement and those new owners will want to see increased value to the franchise they just paid an even more ridiculous amount for and will be looking for a lockout at the next round of negotiations.

[Local_NG_Idiot]

I still don't think people are grasping the concept.

If we use your analogy:

The NBA is the Royal Bank (largest in Canada)
The Turkish League is the Credit Union

They both are competing for the same employee.

They both offer the same basic job branch manager with the same basic duties (ie playing basketball)

The Credit Union offers 40 K a year and a partial benefit package plus you need to live near the branch which is in the middle of BFnowhere
The only competition for the Royal Bank for this employee are a whole BUNCH of Credit unions. The Royal bank is the only Bank this big.

The Royal Bank offers a FULL benefit package, they offer branches in the most desirable cities. Does the Royal Bank need to offer 160 K salary and profit sharing to get this manager? No of course not. They can offer 60 K and probably still get him because none of the competing offers is even close. The manger can't get more than 40 K anywhere else but the Royal bank. If they offer 160 K they are bidding against themselves.

What players taking 2,3 4 M a year to play in Europe does it to show that maybe the NBA doesn't NEED to give players 50% plus of BRI. The players have for a long time not really needed to look on the other side of the fence. They will come to realize that not only is the grass not greener on the other side but that the grass on the other side is full of cow dung.

This isn't necessarily about owners sharing revenue among themselves. Its about how big a piece of the pie the have to share. I don't think a lot of players know how good they have it under the current CBA..at least until they look at the alternatives. What alternatives does a guy like Reggie Evans have? Play in Europe for 200K, flip burgers at Mcdonalds or play in the NBA for millions.

I think that the owners realize that they are giving the players too big a piece of the pie and that most of them don't have any alternative that's remotely as lucrative as the NBA even at a big salary cut.

But you aren't going the full way with the analogy. RBC major branches in Toronto/Vancouver would say represent the Lakers or Mavs, RBC branches in medium sized cities like Ottawa, Calgary would represent the Celts or Magic etc..., your smaller rural branches would be your Sac Kings and NO Hornets and your credit unions are your overseas league teams.

There is enough competition created and enough revenue that the top branches can justify the 160K+ salaries plus profit sharing, stock options and benefits in order to compete with one another for top end talent so price drives up at the top end which trickles down through the ranks.

What you are suggesting is called collusion which if proven is illegal in the business world. You are correct though, because the NBA is an incorporated business with "franchises", it can attempt to create this type of company wide salary limit even though they allow their own franchises to compete for the services of the same 350 or so employees. In this case however, the employees have to agree which they aren't likely to do.

[LittleOzzy]

Local_NG_Idiot Please check your PM.

Thanks.

[Too Late Crew]

But you aren't going the full way with the analogy. RBC major branches in Toronto/Vancouver would say represent the Lakers or Mavs, RBC branches in medium sized cities like Ottawa, Calgary would represent the Celts or Magic etc..., your smaller rural branches would be your Sac Kings and NO Hornets and your credit unions are your overseas league teams.

There is enough competition created and enough revenue that the top branches can justify the 160K+ salaries plus profit sharing, stock options and benefits in order to compete with one another for top end talent so price drives up at the top end which trickles down through the ranks.

What you are suggesting is called collusion which if proven is illegal in the business world. You are correct though, because the NBA is an incorporated business with "franchises", it can attempt to create this type of company wide salary limit even though they allow their own franchises to compete for the services of the same 350 or so employees. In this case however, the employees have to agree which they aren't likely to do.

the employees have to agree which they aren't likely to do.

But they have agreed. They have agreed over and over. In the last CBA in the previous one and the one before.

The players really have 2 choices. Keep agreeing to this franchise based "collusion" or decertify. They have been down this road and rejected decertification.

Decertification isn't in anyone's bets interest honestly. The result would be a totally free market where the big market teams would buy up all the best players. Now that may sound like it would be good for the Lebron's and Amare's of the world but really it wouldn't because it would shrink the size of the NBA drastically. There would be far fewer teams, fewer games and fewer jobs. The guys who aren't superstars would get paid peanuts or have no job at all.

Unless the players are going to make a major change in their thinking and decerify the argument isn't about collusion or anything else. Its simply about who gets what size piece of the pie. The owners see it as an opportunity to get the distribution of "the pie" back where they want it to be.

From a business perspective I don't blame them. I don't think a fixed % of revenue to be spent as slary is a particularly effective way to run a business.

[Crane08]

Just to let you guys know, NFL Lockout just ended I really3x hope we are next!!!!

[Ian4]

this lack of raptors news is killing me.

cha mon end this lockout already!!!!!

[Too Late Crew]

NFL agrees to a new revenue split with Players 53% for owners 47% for players.

Could this set a precedent?

Yes people are going to argue about what goes into BRI etc but the perception will be hard to overcome...owners of a business usually get more than the employees.

[Parataxis]

NFL agrees to a new revenue split with Players 53% for owners 47% for players.

Could this set a precedent?

Yes people are going to argue about what goes into BRI etc but the perception will be hard to overcome...owners of a business usually get more than the employees.

It's no more likely (indeed, less, given the revenue models) to set a precedent than the NHL revenue split agreement did.

[dagger]

NFL agrees to a new revenue split with Players 53% for owners 47% for players.

Could this set a precedent?

Yes people are going to argue about what goes into BRI etc but the perception will be hard to overcome...owners of a business usually get more than the employees.

Or as Grange states pretty elegantly.

http://www.sportsnet.ca/basketball/2011 ... bour_deal/

The NFL owners got what they wanted. The NBA owners will get what they want, and a year from now the NHL owners will get what they want too – a cut in the player’s share of league revenues from 56 per cent to much less than half.

The only question for the players is how much of their own money they want to spend to get to the place they’re all going anyway.

[Fairview4Life]

Do owners of a business really get more of the income % than the employees? On a 1 vs. 1 basis, sure, they did before this NFL CBA deal too, since the players cut is split between a lot more people than the owners cut. How many businesses out there actually spend less than 50% of their income on employee costs though? I'm sure there are quite a few, but I kind of doubt it's a majority. Seems like that would be the highest cost for most businesses to me.

[Courtside]

Do owners of a business really get more of the income % than the employees? On a 1 vs. 1 basis, sure, they did before this NFL CBA deal too, since the players cut is split between a lot more people than the owners cut. How many businesses out there actually spend less than 50% of their income on employee costs though? I'm sure there are quite a few, but I kind of doubt it's a majority. Seems like that would be the highest cost for most businesses to me.

Depends on the business. If it's a service then labor is probably the highest % or in manufacturing there are a lot of material, equipment and facility costs - but once you get into an area like entertainment - which most closely aligns with sports, it's a different ballgame.

A $100 million movie might spend $20 million on the "talent" you see in the movie (the athletes), another $20 million on the supporting staff and more than both combined ion things like equipment and location rentals, props and set design, travel and food expenses, then there's all kinds of legal costs.

A touring band might be a better example - how much does the band itself get paid when you factor in all the travel costs, stages, lighting and equipment, all the tech staff and roadies, stadium and arena costs... You can bet it's nowhere near 50%. That's just the touring side - on the recording and album side they'd be extremely lucky to get 10%.

Anything near 50% is extremely fair for athletes, let alone more than 50. IMO.

[Fairview4Life]

Slightly different situation than with movies, in that expenses are paid first, not tied to BRI (and adjusted later). There's a lot more financial risk with a movie than with an NBA team.

[whoknows]

Do owners of a business really get more of the income % than the employees? On a 1 vs. 1 basis, sure, they did before this NFL CBA deal too, since the players cut is split between a lot more people than the owners cut. How many businesses out there actually spend less than 50% of their income on employee costs though? I'm sure there are quite a few, but I kind of doubt it's a majority. Seems like that would be the highest cost for most businesses to me.

In today's automated manufacturing employees expenses are a lot less than 50% (more like 20%).
Most likely other industries (mining, oil, transportation, etc) are also with a less than 50% expense for salaries.

I'd say that a 60% (owners) and 40% (players) is a healthy balance for sports. If teams are healthy financially all fans are losing. A 20% salary decrease for athletes will not diminish the pool of talent IMO.

[youreachiteach]

I can see a 55/45 or slightly better situation (up to 52/48) simply because the players are awfully big draws and do produce a lot of money for the owners. Most stars are kind of like part owners because when they move the valuation of their franchise is significantly altered.

It simply can't be over 50. They are still employees, although wildly successful, rarely found nuggets of gold that they are.

[Too Late Crew]

Its hard to compare % of revenue to labour because of the differences in industries and their dependence on labour, technology capital assets etc.

What I do believe is more common is that out side of PRO Sports its very rare to determine wage rates by simply agreeing to give employees as % of gross REVENUE.

Yes some companies have profit sharing...but that is based on profit not revenue. There are commission sales people but once again the commission in many cases is based on profit not revenue. If it is based on revenue (ales price) its rarely 50%.

Salary is usually based on market value which amounts to what does my competition pay. When I say competition I don't mean departments in the same company but other companies. During CBA negotiations what is at issue is what the NBA needs to pay in order to get players to play in the NBA not what the Lakers need to pay vs the Twolves.

[Fairview4Life]

If only the TWolves and Lakers were sharing 100% of their revenues.

[Too Late Crew]

If only the TWolves and Lakers were sharing 100% of their revenues.

Even if they did they would still be fighting over whether the Twolves and Lakers shared 46% of 3 billion dollars or 54 % of 3 billion dollars.