NBA seeking rollback of existing salaries

Per Realgm:

An
NBA spokesman confirmed to RealGM that the league is in fact seeking to
roll back existing player salaries, rather than simply changing the
rules dictating the terms of future contracts.

In attempting to reduce player costs by approximately one-third, the
league is not making a distinction between signed contracts currently in
force and those that would be signed after the new collective
bargaining agreement takes effect.

Whether they get a full rollback in salaries or not, if they put in a hard cap or some other salary structure, at a minimum, they need to rollback how the present salaries count against the cap.

The negotiation, IMO, really comes down to this:

Is David Stern and the NBA full of crap when they say they're losing 350 million a season or are they actually taking such losses?   As I've noted, Forbes details on the franchises show a considerably higher operating income than that. 

If the franchises are losing as much money as Stern says in reality rather than due to accounting tricks then the owners will play hard ball with the players, and the owners will win.   The players have a remarkably short shelf life in terms of years they can earn in the league, and probably 25% of the players would need to declare bankrtupcy after a single canceled season.

Decertification could be a tremendous hammer to use against the league, but the players don't really want to decertify as it hurts more players than it helps, and there would be huge money spent on the anti-trust suit which isn't guaranteed to be successful.   Both sides have a lot to lose in this scenario, as a work stoppage would shrink the pie by so much that either side is better off taking less up front to avoid a stoppage.

At the same time if the average franchise is losing 10 million a year, a work stoppage isn't really costing the many of the owners anything.   They're losing money by playing the season anyway, and while they need to still pay some lease agreements/staff even during a lockout, the fact that they save on player expenses means that they'll probably be in a near break even situation whether they play or not.

As such, many owners will have nearly infinite patience in watching this thing play out.  They need a new agreement to get profitability.     While it will be a tough sell, the real solution to this problem is probably greater revenue sharing between the haves and have nots.  No other solution is ever going to create a system where New York and L.A.  can have a salary cap that fits their revenue at the same time the Memphis Grizzlies have one that fits theirs.

Can the owners negotiate that amongst themselves?   There are many sides that need to come together, and few of them are looking out for what's best in the league.   The haves and have nots on both the owner and player side have significantly different views and motivations then their peers which explains why these negotiations are always difficult.

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  • The biggest problem is except for San Antonio, there has not been many small markets which have even won once in the NBA. You never have that in any other sport. David Stern milked all he can from Magic, MJ, Kobe etc... This other teams just don't have a chance and plus the rules favor the superstar+ big market combo. With the bad economy in the whole world(it is probably the worst since the Great Depression), it has definitely reduced ticket sales. Last year I got free tickets handed out when I was visiting Atlanta before the start of a game. I remember it was tough to get tickets during the 90s in Atlanta(atleast not for free).
    Also, combined with the super incomes in the last 20/25 years has clouded the thinking in most people's minds like our housing market. We cannot value the teams the same as it was in 2003/2005. Revenue sharing is useless as we have seen in baseball with the owners pocketing the money and leaving the competition the same. The Memphis owner would probably like to pocket the extra 10 mil and not pay any new player.

  • Agree to your points. The problem with the NBA is the impact of the talented player unlike other sports except for maybe the QB in Football. LBJ's salary(if he was an engineer) at a minimum should be 5 times the next best guy say Durant. So, I would never understand how a cap would work in the NBA unless the minimum salaries are very,very low like D-League.

  • I like that idea..

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