Windhorst: "players have no idea about the capwave that's about to hit them"

[VanWest82]

I personally think they should just let it ride out, and let the cap drop. Do we really care that owners and players will "lose money"? This is millionaires vs. billionaires. Let the cap go down, but they should keep the lux tax where it is.

As a Bulls fan, I am just bummed (but understand) if we don't see NBA ball again until March or April.

This might be what they have to do. Tell the players they're anticipating significant lost revenue and go forward based on some much lower number. It's crazy to me that NBA is projecting a flat cap. If they pay players based on that they stand to take on huge losses which you know they won't do for long. It feels like they're dreaming.

[vxmike]

I personally think they should just let it ride out, and let the cap drop. Do we really care that owners and players will "lose money"? This is millionaires vs. billionaires. Let the cap go down, but they should keep the lux tax where it is.

As a Bulls fan, I am just bummed (but understand) if we don't see NBA ball again until March or April.

NBA owners care if they lose money, and there’s no guarantee we get NBA ball in March or April. There’s no guarantee we get a 2021 season. Players don’t want to do a bubble and lots of owners can’t afford to pay the salaries with no revenue from ticket sales. COVID-19 spreads worse in the winter and as cases get better we loosen restrictions and then cases get worse.

If they don’t play 70 games I think there is no TV money at all. They have to play some kind of season even if they do another bubble. Could do an East bubble and a West bubble and just play inter-conference games for one regular season.

[trickshot]

Ratings don’t matter though

Ratings have been falling since 2012, you know, the same time frame the cap skyrocketed. The pandemic and the China situation are far more relevant to the impending cap drop

[Mulhollanddrive]

Isn't it going to just be smoothed?

So 109m for a few years until revenue is fully recovered.

[Buckeye-NBAFan]

I've seen many fans say they don't care about ratings and the financial health of the league. And they don't care if players are making less because they make so much anyway.

But I'm wondering how fans will feel when their team suddenly has no money for free agents and starts making roster moves simply to cut costs. That doesn't sound super awesome to me.

It's not like they'll stop playing basketball

Those players won't leave the league. Teams with lots of flexibility like ATL, NYK, DET, SAC, CHA, MIA benefit

Tickets will get cheaper

Obviously within reason, no one wants to see the league fold. But that's not going to happen

[VanWest82]

18 month journey? I dont think the people/economy will stand for that

They don't have a choice. Ignoring this virus doesn't make it go away - it just makes it spread faster and do more damage, and it's already been proven out in many places that you can't have a fully functional economy, at least in the way it existed pre-pandemic, with covid cases rising out of control. People get freaked out and stop going out and spending money. As long as large swaths of the public are getting extremely sick and dying that'll be the case.

[VanWest82]

Isn't it going to just be smoothed?

So 109m for a few years until revenue is fully recovered.

If there's significant lost revenue next season "smoothing" would require significant losses for the owners. Not all of them are likely in a position to withstand that, especially with their other businesses likely hurting as well.

[islanders11040]

Ratings have nothing to do with the cap. It would only matter if the league contract was up and networks were not willing to pay as much. But so far nothing indicates networks won't pay billions for live sports rights.

I’m honestly not in the know about this but if the contracts are all signed I guess you’d be right. But I don’t know if they are.

Ratings matter a lot for syndication though and the NBA probably leaves room for more of that. Also, contracts can be contingent on things like ratings. It’s not always black and white.

But again, all speculation. Don’t know the facts.

actually i remember reading somewhere that the next contract was gonna be even more $$$ even with decreased ratings. Live sports are becoming more and more important for networks that are competing with streaming services.

[Calamity_Cometh]

I don't think that it is outrageous to say that we are in unprecedented territory here. Every single person reading this has had that moment of "whoa, what world am I in right now. "

[BoogieTime]

18 month journey? I dont think the people/economy will stand for that

They don't have a choice. Ignoring this virus doesn't make it go away - it just makes it spread faster and do more damage, and it's already been proven out in many places that you can't have a fully functional economy, at least in the way it existed pre-pandemic, with covid cases rising out of control. People get freaked out and stop going out and spending money. As long as large swaths of the public are getting extremely sick and dying that'll be the case.

How do Sweden, Belarus and the non locked down countries look ?

Even if it was doing untold damage, societies cant afford it

[zimpy27]

Isn't it going to just be smoothed?

So 109m for a few years until revenue is fully recovered.

This is the logical thing to do. Or just increase it by something low, like 2m a season.

[snaquille oatmeal]

And so the free agent one year and done signing era begins.

[PaulieWal]

I've seen many fans say they don't care about ratings and the financial health of the league. And they don't care if players are making less because they make so much anyway.

But I'm wondering how fans will feel when their team suddenly has no money for free agents and starts making roster moves simply to cut costs. That doesn't sound super awesome to me.

A lot of damage was caused by that one Morey tweet. The one where he just tweeted and didn't actually follow up with some action plan to help those in trouble.

Yet it was the players that were financially affected by this error that ultimately led to no change at all for the people affected by china. People even got upset with the players for being annoyed by this.

Oh come on. Morey tweet has nothing to do with the ratings in a free fall in North America and the virus has basically taken away 40% of the league's revenue due to no fans in the arena.

With or without the China tweet, the league would operate in the red without fans in the stands. Players were mostly annoyed because it would cost them endorsement money rather than actually the salary cap. Let's be real with that.

[celticfan42487]

While the salaries will be lower, and free agents will prefer 1 year deals because of it.

This should land to the same priority for free agents.

1) Goto a big city to make money outside of the NBA in endorsements
2) Winning team to get to the playoffs to increase one's marketability for endorsements

When that new TV revenue hits though after the contract expires if these trends continue we may actually see a contraction in the league for franchises. Or perhaps some negative ramifications for the Dleague and the financial black hole that is the WNBA.

We're living in a dangerous time for the financial health of the league.

[VanWest82]

18 month journey? I dont think the people/economy will stand for that

They don't have a choice. Ignoring this virus doesn't make it go away - it just makes it spread faster and do more damage, and it's already been proven out in many places that you can't have a fully functional economy, at least in the way it existed pre-pandemic, with covid cases rising out of control. People get freaked out and stop going out and spending money. As long as large swaths of the public are getting extremely sick and dying that'll be the case.

How do Sweden, Belarus and the non locked down countries look ?

Even if it was doing untold damage, societies cant afford it

just because a place isn't locked down that doesn't mean covid isn't changing habits. You can't force people to go out and spend money. And even though Sweden's economy shrunk a little less than some others who did lock down, they still had their worst quarter in half a century. Why do you think that was?

Also, I never said it was 18 months of lockdown; rather, 18 months (at least) of having this virus out there infecting people.

[JN61]

Yes. Such a successful product that alienated all their fans that if you can't sell over priced tickets to companies you are making a loss...

[JN61]

I personally think they should just let it ride out, and let the cap drop. Do we really care that owners and players will "lose money"? This is millionaires vs. billionaires. Let the cap go down, but they should keep the lux tax where it is.

As a Bulls fan, I am just bummed (but understand) if we don't see NBA ball again until March or April.

Never underestimate the entitlement of the millionaires. They don't love the game enough to play with heavily reduced salaries. Rather take shortened season and same pay later on for less work.

[ArtMorte]

I thought I saw a piece of news / speculation a while back that the cap is going to stay at 109m and if franchises think they can't afford that without losses it's up to them to make moves. I really think that's more realistic than lowering the cap to 90m or whatever to screw teams over even more.

[zimpy27]

I've seen many fans say they don't care about ratings and the financial health of the league. And they don't care if players are making less because they make so much anyway.

But I'm wondering how fans will feel when their team suddenly has no money for free agents and starts making roster moves simply to cut costs. That doesn't sound super awesome to me.

A lot of damage was caused by that one Morey tweet. The one where he just tweeted and didn't actually follow up with some action plan to help those in trouble.

Yet it was the players that were financially affected by this error that ultimately led to no change at all for the people affected by china. People even got upset with the players for being annoyed by this.

Oh come on. Morey tweet has nothing to do with the ratings in a free fall in North America and the virus has basically taken away 40% of the league's revenue due to no fans in the arena.

With or without the China tweet, the league would operate in the red without fans in the stands. Players were mostly annoyed because it would cost them endorsement money rather than actually the salary cap. Let's be real with that.

China accounts for 7% revenue and that's non-arena income that has very little expense to create. Arena revenue is high but expenses to operate that is also high, the net profit would be smaller than you think and the net profit from china would make a big dent.

Players cost about $3B and that's meant to be about 50% of profit. So say profit is meant to be $6B. China brings in $500m, other tv and streaming brings in about $3.5B, $1B comes from merchandise meaning stadium brings in ~$1B profit from ticket and food. The season was halfway through so let's say $500m was lost from stadium profit.

Loss of china and stadiums and bubble costs= $1.5B loss or a 25% drop.

[naabzor]

Can teams just cut salaries proportionally to the players?