Is half the battle solved?

The overall vibe of yesterday's larger meeting between players and owners was negative. It appears the players didn't want to discuss how much they would bend financially until the owners agreed to leave the system in tact, but there was one sparklingly positive quote about yesterday's meeting.

From Ken Berger's twitter:

Stern: Felt going in there was an economic deal "within view." Thought there were economic goals they could mutually meet.

We don't know how much the players moved. We don't know how much the owners moved. We know that the players offered additional financial concessions that were large enough to entice both sides to bring a larger group to the table.

The larger group from the owners weren't willing to negotiate with the present system in tact. Silver said the owners don't use terms like "blood issue" or "non-negotiable" and Stern termed it an "emotional attachment".

Silver, of course, is full of crap. Everything is negotiable for the owners only when being negotiated down. There isn't a single thing coming from this agreement that will be better for the players than the previous agreement. However, clearly long term profitability is a blood issue for the owners and apparently so is moving away from the present system.

Stern and Silver would argue that if the players get the money on a macro level they shouldn't care who pays it on a micro level, but that's clearly not true. Like we all know in our daily lives, some jobs are better than others. Larger market teams are more attractive than smaller market teams to players.

Players want the large market teams to continue to have more purchasing power so they can go there. They want winning teams to continue to have exceptions to add players to them, so guys can chase the ring on an MLE instead of a vet minimum.

Also, whether the players want it for this reason or not, success in the large markets means more ratings and more money for the NBA. The league simply has more interest when the marquee franchises are at the top of the league.

On top of that, after major financial concessions, the NBAPA likely feels it needs to win something to save face.

There are many reasons why the players don't want a hard cap even with the macro level salary agreed to.

However, all of that aside, there were two primary issues heading into this negotiation: Money and system

The two sides have not resolved money issue completely, but they are close enough to resolving it that it can be resolved. That's fairly good progress for mid September given how far away the sides started.

If the money issue really is close enough, then the players should expect to get system concessions if they wait long enough. You only need 16 owners to agree to a new CBA, and at some point, it seems likely that 16 owners come to the conclusion that it's insane to blow up this season over the system after they won the money battle.

At this point, if the money has been worked out, there are at probably 20+ owners who are losing out on huge amounts of money by not agreeing to a deal, and getting system concessions wouldn't make them any richer it would just give them the hope of better parity.

At some point those 20+ owners are going to stop and think, "Am I really willing to lose a ton of money in order to have a system where I theoretically [but likely not in practicality over the course of this agreement] have a better chance to win?".

Assuming the deal is six years, how many championships would be swung in a different direction by system changes? If the system changes don't break up the Miami Heat, the answer is likely between none and one, and breaking up the Miami Heat probably isn't good for the league as it is about to enter new TV negotiations.

So if you are an owner, and you know that over the next six years, changing the system is likely to either not impact the eventual champion or will impact the eventual champion but lock you into a considerably worse 10 year TV deal, how hard do you really want to fight that thing?

It's David Stern time now. It's time to sell the owners on how much they've already received in concessions and convince them to start bending in other areas to close this deal.

The owners don't need to win everything in this deal as they will still be here in six years. They're probably better served entering their next TV negotiation period with the present system benefiting large markets and superteams in tact anyway.

They won the most important part of the negotiation already, and it can't be worth missing a season for them to continue to hard line stance on the system.

We've seen the players give, now it's time for the owners to give too, and it's time for David Stern to convince them to do it.

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  • Great analysis. I love reading this stuff.

    Also: intact.

  • Hi Doug,

    thanks for posting all these articles during the off-season. I really enjoy reading them. I am a hard core bulls fan and NBA fan, so this is the first page I open every day.

    It's an interesting issue. The new system from the owners will push for parity. You would expect parity to make the league more interesting but historically this has not been the case. the league is at it's most popular when big markets are wining. Hopefully they come to an agreement before games are missed

  • In reply to dperrozzi:

    I'm not sure the new system will necessarily push for parity. It will push for whomever has the best superstar to win which won't necessarily favor large market teams anymore, instead you'll have a different set of haves and have nots, and it will be based entirely on luck of the draw in the lottery.

  • Doug,

    Whiile I mostly agree with your analysis, and I find it reasonable to a rational person, you might be optimistic and viewing the situation from a fans perspective, i.e. someone who just wants there to be basketball and in the end doesn't really care about who wins between the players and the owners.

    My sense is that there is always more ego and pride involved in these type of negotiations that most of us realize. And most of those involved have enough money to put ego and pride ahead of reason, especially the owners.

    My sense is that the average fan probably sides more with owners on changing the system(so that we stop having Eddy Curry, Rashard Lewis, etc contracts) and maybe more with the players on the cut of the pie situation, even if at the end of the day all we really want is an agreement that means not loss of games.

  • In reply to BigWay:

    I agree that ego plays a huge role in how this thing will turn out. I think that's one of the reasons I hope the owners give in to some of the system demands of the players.

    It allows them to walk away with some ego.

  • Here is the thing though, there is lot of rumblings going that agents are pushing the players to decertification. If the players decided to decertify this might change the entire thing, and possible make the whole entire process longer. Possible missed from half of a season or the entire season in jeopardy.

    Thursday players and owners meeting is going to be important determine what is going to happen next. Maybe lead a possible decertification from the union side.

  • In reply to pduh:

    It will be interesting to see what will happen if the owners push too hard and the players vote out Billy Hunter and go the decertification route.

    Do the owners want to really deal with that mess?

  • doug you're looking at this whole thing as a fan of the Chicago Bulls & I also sense you are a Lebron James fanatic. But what about the teams like Memphis or Toronto. With Miami kept together, the NBA will draw more attention but it won't draw more money. The TV camera's are going to follow Lebron James, Dwayne Wade & Chris Bosh, whether they are together or apart. It's more profitable, overall, to have them apart. The other thing is, if we don't share Lebron, D-wade & bosh with other teams, & make salary reductions, then owners are going to sell and get out because it simply isn't a profitable investment. That's bad. If the NBA doesn't have investor's then its all taking a turn for the worse AND players will see even more significant salary reductions. And if you think the NBA is self-sustainable, then you really are clueless because if the owners aren't seeing a significant profit then the NBA definitely isn't staying even. Or do you expect investors to sacrifice their investment for the good of the game?

  • In reply to mepeterser2451:

    The NBA drew record money last year with Miami being a massive story.

    People are compelled by potential greatness, especially potential all time greatness. The biggest money drawing time in the league [inflation adjusted] was in the Jordan era, and at that point we knew Jordan was going to win.

    People wanted to watch the greatness.

    In terms of profit, the players, reportedly, gave back enough concessions to ensure profitability during the most recent talks, and the owners said not good enough because they also want a hard cap.

    It's no longer a profitability issue. It's a hard cap issue now.

    Also, it's worth noting that these franchises are far more profitable than the numbers let on. The owners all own other businesses and hide their costs in their NBA franchises as a tax shelter.

    The numbers all around aren't great for the league everywhere, but the plaeyrs have given back enough to make them acceptable.

    This isn't about the money anymore.

  • In reply to DougThonus:

    when it comes to the owners, it's always about money. Miami was a massive story & drew record money but it didn't provide the profit to other owners that they expected when they invested in the teams. That's why we see so many terrible teams being sold. Also, the players giving salary money back doesn't make the owner's in the least bit profitable. We're comparing millions & billions. The way that salary reduction increases profit for owners, is so that high caliber players will be forced to spread throughout all the other teams increasing revenue. And again revenue sharing doesn't fix this. Because the owner who invested in Miami spent a whole lot more than someone who invested in Indiana. Then you talk about the owner's other businesses. That makes absolutely no sense. An investment is a sound investment if it will produce a profit no matter how rich the investor is. In fact, the richer an investor is, the larger the profit should be for any one investment to attract that investor. I'm pretty sure you have invested some money and hope to get something out of it down the road. Would you be happy if they took your profits and used it for themselves? Would you continue to invest in that company if it brought you much less than other investments?

  • 1. I think the fans want to watch a combination of failure and success. I think if Miami keeps losing for the next 3 years, their team will not be a draw. But if they win one or two and lose some, people will want to watch them to root against them.

    2. Today, Barkley was mentioning that this big market agenda driven by superstars is not going to work. I think the owners in Minneapolis, Milwaukee, Cleveland, Indianapolis etc...didn't buy teams to become a minor league team for NY, LA etc.. If there is no hard cap and franchise tag kind of thing, this will be a difficult negotiation for the players.

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