Official CBA/Labour Talks Discussion Thread II

[BorisDK1]

Team sale price, for one.

You're assuming that purchase prices are purely reflective of profitability: they're not. There's a whole lot of reasons why people buy NBA teams, and few of them are financial. Frankly, NBA teams are vastly overvalued at present and more than a few people could end up losing their shirts in that investment if the operating conditions don't improve.

[Rapsfan07]

Can some explain to me what's wrong with splitting the BRI 53% Players and 47% Owners?

From what I'm understanding, Stern believes the league would be best positioned to make a profit on a 50-50 split but it's the Player's Union that is refusing to come off of their 53% (recently lowered to 52.5%). Couldn't the union give them their 53% in exchange for a system with a hard or flex cap?

A system where for example we have a cap of 58 mil or so and a Franchise Tag on a player where his salary is removed from the cap. Lower the MLE, make more punitive taxes, salary roll backs, years of contract shrinked slightly etc.

It's a tall order from the Owner's side (obviously there would be more things added and numbers tweaked) but one that's fair, could benefit both sides and prevent this pie from shrinking even more. Every day spent arguing about this is making it even harder. With the right amount of rollbacks (current and future salary roll backs) and system that makes every team competitive, couldn't the league return quickly to profitability?

The Player's Union can't have the bigger slice of the pie AND a system that's in their favor. It's not realistic and I think that's what dragging out this lockout. Someone correct me if I'm wrong.

[dacrusha]

Team sale price, for one.

You're assuming that purchase prices are purely reflective of profitability: they're not. There's a whole lot of reasons why people buy NBA teams, and few of them are financial. Frankly, NBA teams are vastly overvalued at present and more than a few people could end up losing their shirts in that investment if the operating conditions don't improve.

They are not vastly overvalued. They are valued exactly as they should be: money making machines for all but the worst 5-6 markets. Do you think the ownership groups that bought the Warriors, Nets and Sixers are a bunch of dummies?

And if your assertion that 'there's a whole lot of reasons why people buy NBA teams, and few of them are financial' is true, then why are the owners so desperately fighting over a percentage point or two of BRI and increased financial security?

[BorisDK1]

They are not vastly overvalued. They are valued exactly as they should be: money making machines for all but the worst 5-6 markets. Do you think the ownership groups that bought the Warriors, Nets and Sixers are a bunch of dummies?

In the case of the Nets, that franchise was purchased on spec tied-in with a substantial real estate development package. The people who bought the Warriors and Sixers? Either operating completely on spec (hoping that they can re-sell the team later to make up for the cash they're hemorrhaging now) or simply want the fun of owning an NBA team, which is why a lot of people own basketball teams.

I think it's obvious by now that owning an NBA team, except for all of the most advantageous cases, is almost a guarantee of losing money - not a "money making machine". If that were true, the league would not have posted the kind of cash losses they did last year.

And if your assertion that 'there's a whole lot of reasons why people buy NBA teams, and few of them are financial' is true, then why are the owners so desperately fighting over a percentage point or two of BRI and increased financial security?

Is this a serious question? They're absolutely bleeding money. That's why they're fighting over BRI. If they were breaking even, or posting minimal losses, the utility that comes from owning an NBA franchise would make most rich folk just laugh it off (even if that's a horrible financial outcome). They need to at least do that, if they want to sustain these ridiculous values of the franchises.

[C Court]

Like I said before, this dispute is mostly about money. According to Ken Berger, the hard cap doesn't look like its going to happen, even though the luxury tax will be more punitive:

The players have won a couple of surprising "victories" by holding onto guaranteed contracts and a $5 million mid-level exception and beating back the owners' pursuit of a hard team salary cap.

All this talk of parity makes everyone feel good, but the owners value money way above competitiveness.

[Twinkie defense]

Even if team values are guaranteed to increase year over year (just like housing) I think it is better for the League, fans, and players if owners aren't forced to take year-over-year losses until they sell. Some owners can't sustain those losses - which will result in cost-cutting - and others will be pushed to sell (where we get right back into the same cycle, except with an even greater investment to sustain and recoup). I want owners to stay in for the long haul like owners do in the NFL, love and invest in their teams, treat them like family heirlooms and their best players like family, and not just flip them like real estate.

[Ponchos]

Even if team values are guaranteed to increase year over year (just like housing) I think it is better for the League, fans, and players if owners aren't forced to take year-over-year losses until they sell. Some owners can't sustain those losses - which will result in cost-cutting - and others will be pushed to sell (where we get right back into the same cycle, except with an even greater investment to sustain and recoup). I want owners to stay in for the long haul like owners do in the NFL, love and invest in their teams, treat them like family heirlooms and their best players like family, and not just flip them like real estate.

On the flip-side, create a system that favors the owners and guarantees them a profit and you have an even worse outcome for the fans.

Expansion.

[Indeed]

Again, my position is, the business doesn't have to lose money if it is not due to poor management and better control in spending.

Owners said they are losing money, but to me, they over spent on items that has no value to basketball. And it is clear "other expenses" that is going 5 times inflation is a scam to me. With NHL having similar costs and lower revenue, I don't understand why NBA owners are claiming that.

[floppymoose]

On the flip-side, create a system that favors the owners and guarantees them a profit and you have an even worse outcome for the fans.

Expansion.

Thank you. Very few people are realizing this.

The other great evil of guaranteed profits are that there is no good way to get rid of bad ownership. Bad ownership needs to be allowed to financially fail, so that they will be forced to sell and the hometown fans get a chance for their team to be led correctly.

[Rapsfan07]

On the flip-side, create a system that favors the owners and guarantees them a profit and you have an even worse outcome for the fans.

Expansion.

Thank you. Very few people are realizing this.

The other great evil of guaranteed profits are that there is no good way to get rid of bad ownership. Bad ownership needs to be allowed to financially fail, so that they will be forced to sell and the hometown fans get a chance for their team to be led correctly.

[ATLTimekeeper]

What's wrong with expansion? There are plenty of cities that could hold NBA franchises (Vancouver, Las Vegas, Mexico City, San Diego, Seattle, 2nd Chicago). And there's more than enough talent to go around. Stars are gathering in groups of threes just to compete. Create a system where everyone wins (in the wallet) and keep growing the sport. The more exposure the more people interested in playing. Look at the crop of Canadians that are about to enter the league. That wouldn't have happened before expansion.

Bad owners/management is the problem? Two of the league's biggest young stars, speaking candidly just said location is more important (to players). That's a problem that needs to be corrected.

[floppymoose]

The objection to expansion is more a matter of taste, just as competitive balance issues are. Some would like more teams, some would regret the lower overall talent level that would lead to.

Much like the hard cap: some would like the improved competitive balance, but others would dislike the increased player movement.

[J-Roc]

All this talk of parity makes everyone feel good, but the owners value money way above competitiveness.

They'll make money if they have the parity of the NFL. But you can't blame them for giving into a fight now by taking money. Whether you're the owners or the players, at some point you have to fallback on taking money and forgetting about fighting for a bigger picture.

[S.W.A.N]

All this talk of parity makes everyone feel good, but the owners value money way above competitiveness.

They'll make money if they have the parity of the NFL. But you can't blame them for giving into a fight now by taking money. Whether you're the owners or the players, at some point you have to fallback on taking money and forgetting about fighting for a bigger picture.

You really don't get it. The NBA will never ever have the parity of the NFL, not the NHL. The way the game is player one NBA star carries more value to their team than any player in the other leagues can.

So regardless of hard cap there are only going to be 6-8 teams that have realistic shot of winning the championship at any time because they are the teams with the top 6-8 players.

Lebron and a bunch of scrubs can win 65 games and almost win a championship.
Kobe +1 allstar big man wins multiple championships
MJ +1 allstar wing wins multiple championships
Tim Duncan with 2 star players wins multiple championships
Hakeem plus wins 2 championships.

The other scenario for winning a championship is called Detroit, which assembled a roster with no superstars but 4-5 star players some of which were all-stars.

Changing to a hard cap doesn't change the fact that for the next 10 or so years Miami, Oklahoma, Chicago and What ever team lands Howard are going to be fighting for a championship.

[Ponchos]

What's wrong with expansion? There are plenty of cities that could hold NBA franchises (Vancouver, Las Vegas, Mexico City, San Diego, Seattle, 2nd Chicago). And there's more than enough talent to go around. Stars are gathering in groups of threes just to compete. Create a system where everyone wins (in the wallet) and keep growing the sport. The more exposure the more people interested in playing. Look at the crop of Canadians that are about to enter the league. That wouldn't have happened before expansion.

Bad owners/management is the problem? Two of the league's biggest young stars, speaking candidly just said location is more important (to players). That's a problem that needs to be corrected.

Lots of reasons to dislike expansion:

- Do the Raptors have a better shot at a championship or a worse one if there are 34 teams in the league?

- Expanding into weaker and weaker markets leads to instability. You'll have the owners crying again that the system is broken and the players need to take a reduced share of the revenues. Whats this mean? More labor strife, more lockouts.

- The talent pool definitely gets watered down. The NBA is just recently recovering from the last rounds of expansion in terms of talent per team.

You're fooling yourself if you think expansion will alleviate stars grouping together in preferred markets.

[Rapsfan07]

All this talk of parity makes everyone feel good, but the owners value money way above competitiveness.

They'll make money if they have the parity of the NFL. But you can't blame them for giving into a fight now by taking money. Whether you're the owners or the players, at some point you have to fallback on taking money and forgetting about fighting for a bigger picture.

You really don't get it. The NBA will never ever have the parity of the NFL, not the NHL. The way the game is player one NBA star carries more value to their team than any player in the other leagues can.

So regardless of hard cap there are only going to be 6-8 teams that have realistic shot of winning the championship at any time because they are the teams with the top 6-8 players.

Lebron and a bunch of scrubs can win 65 games and almost win a championship.
Kobe +1 allstar big man wins multiple championships
MJ +1 allstar wing wins multiple championships
Tim Duncan with 2 star players wins multiple championships
Hakeem plus wins 2 championships.

The other scenario for winning a championship is called Detroit, which assembled a roster with no superstars but 4-5 star players some of which were all-stars.

Changing to a hard cap doesn't change the fact that for the next 10 or so years Miami, Oklahoma, Chicago and What ever team lands Howard are going to be fighting for a championship.

You're right. it does't change the fact that those teams will be contending for a chip.

BUT the piece I think you're missing is HOW it gets done. A hard cap (or flex cap) can definitely impact that. For example, under a stricter system Chicago could in a little bit of trouble since they paid Boozer, Noah, Deng and will need to sign Rose soon. A stricter system could force Chicago to have to move one of their pieces (i.e Deng) to another team than could use Deng in their lineup (i.e New Orleans). Likewise, it would force a team like Miami to give up one of their Big 3 (i.e Bosh) to a team that could use him and get pieces to fill out their roster (i.e Magic after they've amnestied Gilbert or something). Player movement like that would force coaches and teams to get to most out of their player and their money since EVERYBODY has a limit they MUST abide by. Talent will get shifted around and that disables some teams and helps some teams but the distribution of talent is crucial and plays a big part in how teams become perennial contender and chip winners. So you won't have the Heat blowing out say the Timberwolves by like 50 (probably still a blowout but you get the point ). Every game becomes tougher and winning a chip becomes even harder. Competitive basketball.

And when teams get better players, they're more competitive. And generally the more competitive your franchise is, the more money you make.

[Ponchos]

You're right. it does't change the fact that those teams will be contending for a chip.

BUT the piece I think you're missing is HOW it gets done. A hard cap (or flex cap) can definitely impact that. For example, under a stricter system Chicago could in a little bit of trouble since they paid Boozer, Noah, Deng and will need to sign Rose soon. A stricter system could force Chicago to have to move one of their pieces (i.e Deng) to another team than could use Deng in their lineup (i.e New Orleans). Likewise, it would force a team like Miami to give up one of their Big 3 (i.e Bosh) to a team that could use him and get pieces to fill out their roster (i.e Magic after they've amnestied Gilbert or something). Player movement like that would force coaches and teams to get to most out of their player and their money since EVERYBODY has a limit they MUST abide by. Talent will get shifted around and that disables some teams and helps some teams but the distribution of talent is crucial and plays a big part in how teams become perennial contender and chip winners. So you won't have the Heat blowing out say the Timberwolves by like 50 (probably still a blowout but you get the point ). Every game becomes tougher and winning a chip becomes even harder. Competitive basketball.

And when teams get better players, they're more competitive. And generally the more competitive your franchise is, the more money you make.

While I disagree with your example (I don't think the top teams will have to lose any core players) let's say you're right.

Ok so, LA loses Odom, Chicago loses Deng, Miami loses Bosh, Dallas loses.... someone. All these players go to teams with cap space, bottom dwellers. Sac, NJ, Bobcats etc. What does this do for competitive balance? Nothing. Zip. The top teams lose a little, the bottom teams gain a bit and the top teams STILL dominate.

[floppymoose]

You're fooling yourself if you think expansion will alleviate stars grouping together in preferred markets.

In fact it gets worse instead of better. The weaker the average talent pool is, the easier it is for three stars to create a dynasty.

[Rapsfan07]

You're right. it does't change the fact that those teams will be contending for a chip.

BUT the piece I think you're missing is HOW it gets done. A hard cap (or flex cap) can definitely impact that. For example, under a stricter system Chicago could in a little bit of trouble since they paid Boozer, Noah, Deng and will need to sign Rose soon. A stricter system could force Chicago to have to move one of their pieces (i.e Deng) to another team than could use Deng in their lineup (i.e New Orleans). Likewise, it would force a team like Miami to give up one of their Big 3 (i.e Bosh) to a team that could use him and get pieces to fill out their roster (i.e Magic after they've amnestied Gilbert or something). Player movement like that would force coaches and teams to get to most out of their player and their money since EVERYBODY has a limit they MUST abide by. Talent will get shifted around and that disables some teams and helps some teams but the distribution of talent is crucial and plays a big part in how teams become perennial contender and chip winners. So you won't have the Heat blowing out say the Timberwolves by like 50 (probably still a blowout but you get the point ). Every game becomes tougher and winning a chip becomes even harder. Competitive basketball.

And when teams get better players, they're more competitive. And generally the more competitive your franchise is, the more money you make.

While I disagree with your example (I don't think the top teams will have to lose any core players) let's say you're right.

Ok so, LA loses Odom, Chicago loses Deng, Miami loses Bosh, Dallas loses.... someone. All these players go to teams with cap space, bottom dwellers. Sac, NJ, Bobcats etc. What does this do for competitive balance? Nothing. Zip. The top teams lose a little, the bottom teams gain a bit and the top teams STILL dominate.

Not necessarily. Let's say Chicago loses Deng under a hard/flex cap system and take back Ariza and a draft pick or something. Now obviously this would have had to take place earlier but doesn't that increase the chance of keeping Paul and making one more team competitive instead of Paul running to NYK to team up with 2 other superstars? Or if Bosh was be traded to Milwaukee, doesn't that make the Bucks a much more competitive team? You also have to remember that players looks at team's squads before signing as a free agent. Maybe a Indiana Pacers with a Bosh has a better chance of signing Nene?

Stuff like that. It's not the solution to everything but it's a start. Even if it just makes a championship harder to win because it's obvious that a team like the Heat vs New Orleans is a easier win for MIA compared to if they added a Deng + FA. I guess what I'm saying is a competitive league is a league where it's harder for teams to get a chip.

Admittedly, owners will like this more than players (I think) because they will have a player on their squad that is at lease decently marketable.

[Ponchos]

Not necessarily. Let's say Chicago loses Deng under a hard/flex cap system and take back Ariza and a draft pick or something. Now obviously this would have had to take place earlier but doesn't that increase the chance of keeping Paul and making one more team competitive instead of Paul running to NYK to team up with 2 other superstars? Or if Bosh was be traded to Milwaukee, doesn't that make the Bucks a much more competitive team? You also have to remember that players looks at team's squads before signing as a free agent. Maybe a Indiana Pacers with a Bosh has a better chance of signing Nene?

Uh... Milwaukee getting Bosh changes nothing at the top. Does it make them better? Ya. Does it make them a contender? No.

I don't really get what you're arguing here. If middle of the pack teams get a bit better it does not make them able to take on LeBron/Wade and Kobe/Gasol. It certainly does not make them contenders.

In fact, you're kinda arguing against yourself. If Paul goes to New York then there's another team in the mix who can win a championship. If he stays in N.O., then there's fewer teams capable of bringing home the title.