The NBA Contraction Debate Verdict

October 28, 2010

Read the opposing arguments from Sports Geek and Babe Ruthless.

Considering the fact that I am an expectant father, with a child due just a few weeks from now, I have already developed an irrational fear of the word ‘Contraction.’ And it seems that, considering the context of this debate, that negative connotation is quite justified.

To boil this debate down into its most simplistic form, and to put it into terms that many people around the country can truly relate to, the conversation about NBA contraction is really a conversation about layoffs.

The “L” word

The business (NBA) is losing money, and cannot afford to operate under its current structure. As a result, the business (NBA) is forced to choose which is the lesser of two evils – force a pay cut, or proceed with layoffs.

As Babe Ruthless points out, contraction should be perceived only as a viable option when there are none other worth pursuing. A decision like this would not only affect the teams facing the cull, but would also seriously impact the cities and fans which support, and are supported by, those franchises.

For a league like the NBA who already is struggling financially, the bad PR from league contraction and the fan reaction from those cities which would lose their franchises could be very damaging.

But all those premonitions of gloom and doom from Babe Ruthless still did not provide enough justification to me that league contraction was the wrong decision to make. As such, I am awarding the verdict for this debate to Sports Geek, although for a moment, Sports Geek’s own argument almost convinced me to go the other way.

Identifying the root cause

Sports Geek points to franchises such as the Dallas Mavericks and Portland Trail Blazers as teams with winning records that were losing money. So out of curiosity, I checked the attendance numbers from last season to see how those two clubs (for example) fared at the gate.

According to last year’s statistics, the Mavericks averaged 19,994 fans per home game at American Airlines Center, an arena that holds 20,000 at capacity. Likewise, the Blazers averaged 20,497 per game at the Rose Garden Arena, which holds 20,630 spectators at capacity.

Folks, those are sold out seasons.

The Blazers and the Mavericks are not suffering from lack of fan support. And when you look at the rest of the league, only the Philadelphia 76’ers, New Jersey Nets, and Memphis Grizzlies played to an average crowd of less than 75% capacity (compare that to the MLB, where 17 different teams drew average crowds of fewer than 75% capacity).

The real problem is, DESPITE that fan support for home teams, that the cost of paying the athletes has exceeded the amount of revenue that is even possible to be gained. If a sellout will only draw in $2M in sales for each game, how can you be expected to pay $3M in salary?

And even with revenues being generated from TV contracts, advertising, and merchandise, these teams are STILL paying more than they are making.

Normally, this is a problem that can be corrected either by a) cutting players’ salaries or b) raising ticket prices, rather than having to resort to league contraction, which Sports Geek argues is the answer. But just as I was ready to place my seal of approval and award victory to Babe Ruthless, I noticed something very interesting that ultimately changed my mind – attendance statistics for NBA teams on the road.

Big names sell games

Obviously, teams with winning records should be able to garner support from their hometown fans. But it is when those teams go on the road that you find out their value as it is perceived by the REST of the league. The New York Yankees and Dallas Cowboys, for example, will sell out no matter where they are playing. They appeal not only to their home town fans, but they are a draw to EVERYONE.

So, how did the Blazers and Mavs fare on the road?

Portland averaged a road crowd of only 16,546 (nearly 4000 fewer fans than when they played at home), while Dallas drew 17,129 (nearly 3000 fewer fans). And that trend was not exclusive to those two teams, either.

In fact, there were only two teams in the entire NBA (the Cavaliers and the Lakers), who averaged sellouts on the road. And the not too surprising reason those two teams managed the feat is simple – LeBron James and Kobe Bryant.

Every other team (even championship contenders like the Orlando Magic, Boston Celtics, and Phoenix Suns) failed to attract people on the road to the same extent that they managed at home. A problem, as Sports Geek points out, created by an utter lack of star power in the league.

The gap in marketability between players like LeBron or Kobe, and players like Mehmet Okur and Chris Kamen is far too great. There just aren’t enough “faces” in the NBA to fully support 30 different NBA franchises. Then, when you compound that lack of star power with the grossly overinflated contract amounts that the athletes are earning today, you find yourself in a very bleak financial situation.

People just don’t care to go out on a Wednesday night in the middle of December to see Carlos Delfino lead the visiting Milwaukee Bucks in scoring against the Roy Hibbert led Indiana Pacers.

Real value must be established

In a concentrated market, Chris Bosh is not a $100M athlete. Likewise, a guy like Anderson Varejao of the Cleveland Cavaliers, who averages only 24 minutes per game over his career, is not a $50M athlete. But when you dilute the talent level to the extent that the NBA has, players like Bosh and Varejao BECOME superstars simply by comparison to the weaker talent around them. They APPEAR to be superstars, and can cash in as such.

A concentrated player pool, played within a league of fewer teams, would allow for a much better product to be put on the court. Player salaries would more accurately reflect the talent levels in the league, and the “business” of professional basketball could be righted.

It’s time to trim the fat. Addition by subtraction is the answer, and an NBA in concentrated form will help everyone remaining in the league to be successful for many years to come.

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The NBA Contraction Debate

October 27, 2010

Read the opposing arguments from Sports Geek and Babe Ruthless.

It seems these days like the only people making money in the NBA are the athletes.

While players like LeBron James, Chris Bosh, Dwayne Wade, and Amar’e Stoudemire were recently awarded contracts at or beyond $100M each, the collective NBA teams posted a net loss last year of $400M.

Obviously, a business of any kind cannot sustain itself if it continues to lose money.

So in an effort to combat this financial predicament, NBA commissioner David Stern has stated a desire to see the players’ collective salaries reduced by $750M-$800M in order to reverse the negative trend so the NBA can get a return on investment.

One such idea that has been floated to help support this process – an idea that will be on the table at the upcoming owners’ meetings – is the possibility of a league contraction, as some within the league feel that a reduction of teams would provide a remedy to the imbalance between player salary and league revenue.

Which brings us to our debate topic for today: With the financial losses posted by the NBA recently, and the prospect of more losses on the horizon, should the NBA contract some teams?

Clearly this is not a decision that David Stern or the collective NBA owners will be taking lightly. Their continued goal to this point has always been the growth of the league, and expansion has been a major part of that growth. The NBA is arguably at its peak in terms of popularity among the fans, and to face the prospect of eliminating teams from the league would be extremely disappointing for everyone involved.

In evaluating today’s topic, Sports Geek believes that NBA contraction is the way to go, and will argue that “trimming the fat” will be better for the league as a whole. Meanwhile, Babe Ruthless feels that contraction would not be the best solution, and will argue that the NBA should not consider this as a viable option.

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The NBA Contraction Debate… Less is More

October 27, 2010

Read the opposing argument from Babe Ruthless.

Yes, less is more… and I’m not referring to the Miami Heat point total from Tuesday night’s season opener. No, my reference is to successful businesses in today’s modern business landscape. Am I pro downsizing? Of course not… but successful businesses cannot sustain themselves long term if they are consistently losing money. Guess what, folks? The NBA is consistently losing money. Bravo to David Stern (who, for the record, I do not like) and league officials for acknowledging that fact and proposing an obviously unpopular – but shrewd and smart – solution by contracting the league.

Let’s all put our thinking caps on and consider why the NBA expanded in the first place. The business climate of the late 1980s was dominated by one word – growth. The more the better. The faster the EVEN better. Growth was the ambition that superseded all other reasonable concerns. It was the only thing that mattered. Long term thinking did not enter into the equation as it often derailed the conversation regarding growth.

The late 1980s saw four expansion teams appear within two years. First, in 1988, the league welcomed the Miami Heat and the Charlotte Hornets, then in 1989 the Orlando Magic and Minnesota Timberwolves joined up. Six short years later – still in the full swing of growth in the build up to the dotcom bust – two MORE teams were added for good measure in the Toronto Raptors and the Vancouver Grizzlies. None of the teams were berthed with a long term plan for sustainability or even a good solution for how the league was going to create a talent pipeline to maintain and boost the level of competition fans had grown accustomed to with a more concise league structure that made both product and economic sense.

Here’s more business sense for you. The Charlotte Bobcats were purchased for $175M by Michael Jordan. The seller, Robert L. Johnson, paid $300M for the team. Johnson lost a whole lot of money.

In the most recent evaluation of which teams in the NBA made money and which teams lost money, a surprisingly large number of teams lost money. In fact, 40 percent of the league’s franchises LOST money. More shocking, FIVE of the teams that are losing money are actually successful, winning teams. The Portland Trailblazers lost $20M, the Dallas Mavericks lost $17M (though the majority of that may have been in Mark Cuban fines), following by Orlando, Atlanta, and New Orleans. Perhaps the economy impacted a few of those teams, but all 40 percent? That’s doubtful. The league’s costs are out of control and drastic measures must be taken to reign in the poor business decisions from years gone by.

Does the NBA currently have teams that do not contribute much in the way of notoriety of financial return? Yes. Do these franchises in peril have a track record of success but have recently fallen on hard times? No. If the franchises aren’t functioning as they should, and there is no hope of digging them out without deepening the bad investment, why not cut bait? Needless to say, the Memphis Grizzlies, Toronto Raptors, New Orleans Hornets, and Minnesota Timberwolves are not successfully functioning NBA franchises, and they have never had enough success to warrant further investment.

It’s time to trim the bottom feeders in the NBA. Think about it, only good can come from it. The talent pool is richer as there is a higher concentration of talent available to few teams. The franchises that require the most financial attention from the league are now taken out of play. The promotional resources the NBA has available are now concentrated better on the franchises that warrant the attention. Each of those factors is a big success for the NBA.

And, most importantly, the league will save a whole lot of money in player costs, enough to keep the league financially successful and viable.

The NBA is in an interesting time right now. Whether LeBron and his dodgy and insulting new Nike commercial like it or not, he is the villain of the NBA, along with his cohorts down in Miami. For the first time since perhaps the early 1980s the league has a legitimate villain and the suddenly appealing Kobe Bryant playing the likely uncomfortable role of league “good guy.” In short, the league has more attention and popularity than it has grown accustomed to in this decade. It needs to better focus its resources to grow the league’s popularity and diminish the cost of doing bad business.

Contraction will likely suck for those cities that are impacted by it, but the people in those cities had the chance to support the team and chose not to. No blame to pass, that’s just reality. The league must become financially solvent again, but then it has to honor its covenant to the fans and avoid the temptations of rapid growth that lured officials in with its siren song in the late 1980s. Unfortunately for some, contraction is a good place to start.

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The NBA Contraction Debate… Downsizing is Out of the Question

October 27, 2010

Read the opposing argument from Sports Geek.

Right now is a very important time for the NBA. The league stands at the brink of a make or break scenario that holds huge implications for the league. The NBA is suffering significant financial losses while at the same time staring down a lockout for the 2011 season. Right now the NBA is peaking in terms of popularity and the NFL is teetering on the verge of a hugely unpopular work stoppage. The NBA could see major gains in its fan base if it ends up being the only show in town… or it could drive away fans in droves if multi-million dollar athletes decide to sit out during the biggest economic recession of our time.

With the NBA figuring to experience major losses this season, it appears that commissioner David Stern and company are looking at any and every option to stay profitable, including cutting franchises. While on the surface this looks like a good first step towards getting into the black it appears the commish isn’t looking at the long term big picture.

So Long Small Market Teams, Basketball Is Big Business

The NBA is one of the few professional sports that is somewhat small market friendly. The NBA currently has franchises in cities like Memphis, Oklahoma City, Sacramento, and Charlotte. These are certainly large cities but they are by no means the sprawling metropolises of most big sports cities (i.e. Boston, New York, L.A.). In the grand scheme of things the sport might not implode if the Grizzlies or Thunder weren’t apart of the 2011 season, but it certainly would be a major loss to the fans.

Right now then NBA has cracked markets that other sports franchises have not, and that is certainly a public relations booster for them. But if the small market teams get the axe because the league is in the red, it will be a huge step back for a sport that is more inclusive than most. Obviously the NBA is a business and it can only afford to operate at a loss for so long, but pulling the rug out from under a franchise, no matter how small, is sure to make enemies of a sport.

For instance, when the Hornets abandoned Charlotte there was a lot of ill will toward professional basketball amongst the people of the Queen City. Sure all wounds heal with time, and slowly but surely the city is embracing the Bobcats, but that has been a slow and bumpy journey at best. North Carolina was college basketball country to begin with, and a pro team was a risky venture. Then when the people of Charlotte felt they got burned by the NBA it made for awkward bedfellows moving forward with future business ventures. The city opposed funding for a new coliseum for the Bobcats and attendance generally struggled in comparison with the Carolina Panthers. I do not suggest every market would turn against basketball for football and baseball, but it is a plausible result. One that the NBA cannot afford.

Cutting Teams Should Be A Last Resort Not A First Option

Cutting teams is a desperation move for which the league must be fully prepared. The fallout from such an unpopular decision is sure to have ramifications for years to come. When a team or a league abandons a fan base, they turn fans off for years to come. That is not something the NBA, or any sport, can afford.

Popularity is 90 percent perception and 10 percent substance. While that is not a mathematical law, it is a fair enough assessment of the way the world often sees sports. That is not to say a sport’s popularity is not influenced by the excitement of the action on the court or on the field, but rather that a sport’s popularity is influenced by things other than the successes of its best players, high profile teams, or biggest events.

Popularity is often a matter of how the fans perceive they are being treated. If a sport entertains fans, gives them great value, and does not betray their trust, it earns loyalty. But that loyalty can be lost.

For instance, when baseball went on strike, and then the curtain was torn down on the steroid era, the popularity of the sport was dealt a black eye, one that the sport is arguably still not over the hump from today. One of the most damaging legacies of those fiascoes was quite simply that the fans felt abused. Baseball fans are an intensely loyal bunch, and the league allowed the fans trust to be betrayed by performance enhancing drugs and the greed of the players union. Basketball is not above being pulled down by similar circumstances and culling a franchise, no matter how big or how small is public relations suicide.

Of course basketball has to make money, but cutting franchises is not the answer. Calling it league “contraction” does not change the fact that it is telling millions (yes, literally millions) of fans that they were not important enough to continue to entertain. The league must find another way or face the backlash of a scorned public that finds another way to spend its money than supporting a game that doesn’t support them back.

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The Publicly Grading Officials Debate VERDICT

October 14, 2010

Read the opposing arguments from Loyal Homer and Bleacher Fan.

Today’s debate is not about whether leagues should grade officials, but whether those grades should be public knowledge.

This is an extremely important issue in sports because there is a great deal at stake. On the one hand, if publically grading officials encourages them to perform better then it would improve the overall quality of the sports we love so much, but if it does not have this effect than it could serve to seriously undercut the authority of officials.

Bleacher Fan based his argument off of the need for increased accountability through transparency in the way leagues evaluate officials. He believes that officials are afforded the ability to hide behind a wall of anonymity when it comes to corrective efforts meant to redress poor officiating. He finds this to be hypocritical considering the high profile nature of every other aspect of sports. He pointed out that the actions taken against players, coaches, and team management for poor performance is usually very public, yet the league’s efforts to correct problematic officiating remain highly secretive.

This point was definitely not lost on me. Sports fans are very aware of league actions taken against players and owners alike, but officials remain a different story. We all know about the not-so-private war between NBA commissioner David Stern and Dallas Maverick owner Mark Cuban. We all know about the leagues dealings with player with problematic players, such as Ben Roethlisberger and Michael Vick. But no one seems to know which officials, if any, are getting their butts handed to them behind closed doors. Bleacher Fan believes that this cloak in dagger approach cannot lead to anything good.

Bleacher Fan acknowledges the human aspect of the sports. He admits that no one is perfect, but that because we know that no one is perfect leagues should be more open about telling the public what officials grades are and what the leagues are doing to improve the lowest achievers.

Loyal Homer, however, states those grades should remain a secret. He challenges the logic behind releasing private evaluations to a public that is already highly critical of the job officials are doing in the first place. As Loyal Homer explains in his argument, public evaluations would only serve to further undermine the authority of officials.

He made a strong point for his argument when he aptly pointed out that evaluations are not intended for the purpose of establishing worst-to-first ranking of officials, but rather to specify the areas where each official needs to demonstrate professional growth. The goal behind assessing the job officials are doing is to encourage improvement, not to invalidate their authority, which very well could be the result of releasing performance evaluations. Loyal Homer stood firm in his belief that the mere fact that performance evaluations and the incorporation of assistive technologies (i.e. replay) exists to help officials is enough to ensure their validity and reliability as an arbitrator of the rules.

Loyal Homer’s argument raises concerns over the potential dangers of labeling officials due to their performance review grade. If publicized, referee and umpire ratings would be akin to restaurants sanitation grades. Can you imagine the grumbling and second guessing that would surround the calls of an umpire with a “C” rating (the equivalent of a sketchy IHOP)? Regardless of the accuracy, there would be those who would second-guess them solely on the basis of their performance grade. Similarly, in the mind of the public it would not matter whether the official met the minimum competencies established by the league because any official with a less than perfect score would be perceived to be doing a bad job.

Ultimately it was this comparison that made my decision. In the real world, not all workers deserve perfect performance reviews. If they did there would be a lot more Fortune 500 companies out there. The truth is that there are excellent, above average, average, below average, and poor employees in virtually every industry, including professional sports. Some officials are better than others, but publically acknowledging that fact and then highlighting the underachievers would only serve to create a distracting spectacle. Publically grading officials would do nothing to help them improve. Do you really think Jim Joyce would have tried harder to call Armando Galaragga’s near perfect game if he knew his evaluation would be in the media at the end of the year? I honestly think when an official screws up, the media usually covers it sufficiently. Ultimately it is because there is nothing gained but controversy and the undermining of authority by publically grading officials that I award this victory to Loyal Homer. Bleacher Fan can throw the red flag all he wants to, this is one call that is final.

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The Dan Gilbert Tirade Debate

July 14, 2010

Read the opposing arguments from Bleacher Fan and Babe Ruthless.

Here we are, days after Cleveland Cavaliers owner Dan Gilbert wrote an open letter to Cavs fans, and it’s still making news. It’s just too good to pass up, so we’ve decided to address it.

Yesterday, NBA commissioner David Stern fined Gilbert $100,000 for his “inappropriate” comments in the letter. Jesse Jackson, who apparently is a “friend and ally” of the league, called Gilbert’s feelings a “betrayal [that] personifies a slave master mentality.”

There are some high profile names coming out against Gilbert. But Bleacher Fan and Babe Ruthless also are high profile names (in TSD circles), and they are going to debate the issue today. Please look at the question closely.

Was it a good thing for his investment for Dan Gilbert to send the anger-filled message to the fans of the Cleveland Cavaliers?

Bleacher Fan will argue that he has no problem with the move and that it was the right thing to do as an owner. Babe Ruthless will argue that this was not a smart move by Gilbert.

Fire away! I promise I won’t fine anyone $100,000 for anything you say in this debate!

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The 2009 NBA Draft Debate – This Draft Was No ‘Thriller’

June 26, 2009

Read Sports Geek and Loyal Homer’s opinions.



I don’t know about you, but to me, last night’s NBA Draft reminded me an awful lot of the American Idol auditions.

There’s some marginal talent, a lot of probable duds, and I just don’t see any of them turning into the next Michael Jackson of the NBA.

So in this year’s draft, where any pick after the first was ‘Bad’, I decided to give some credit to the one team with enough foresight to ‘Beat It’ right out of the draft – the Washington Wizards.

The Wizards were slated to pick at #5 and again at #32. Having come off of one of their worst seasons in franchise history, they didn’t want to place their hope in some ‘Pretty Young Thing’ that may or may not pan out, especially in this lackluster draft. Their needs were immediate, and so new head coach Flip Saunders didn’t want to risk courting the new young boys of the NBA.

When the Wizards drew the fifth pick in the lottery this year, they immediately began shopping it around and listening to anyone who would make an offer. After soliciting offers from the New York Knicks, Dallas Mavericks, Phoenix Suns, and Portland Trail Blazers, they finally responded when the Minnesota Timberwolves ‘Moonwalked’ over and said they ‘Wanna Be Starting Something’ in a deal for that pick.

After negotiations were finalized, the Wizards traded away the expiring contracts of Etan Thomas, Darius Songaila, and Oleksiy Pecherov – along with the fifth pick. In return, they received from the Timberwolves guard Randy Foye and combo forward Mike Miller, both of whom will make an immediate contribution to the team.

Foye, who averaged 16.3 points per game last season in Minnesota, will make an outstanding complement to the already dangerous guard rotation of Gilbert Arenas, DeShawn Stevenson, and Nick Young.

Miller, who shoots just above 40% from 3-point range, should also make an immediate impact for Washington, who struggled last year with a 3-point average of only 33%. His presence on the perimeter should also help create better scoring opportunities for teammates Arenas, Antawn Jamison, and Caron Butler.

Consider the impact of those two new players on the already explosive Washington Wizards offense now led by the very offensive-minded Saunders. Compare that upgrade to the players they could have taken with the fifth pick in the draft, like Ricky Rubio, Jonny Flynn, or Stephen Curry. The Wizards were smart to take the experienced Foye and Miller and sneak out like a ‘Smooth Criminal’ in the night.

As for pick number 32, it was sold to the Houston Rockets for the small fee of $2.5 million. That $2.5 million could go a long way towards helping them land another key free-agent who will once again bring immediate results to a team that just last year was believed to be a serious playoff contender.

At the end of the 2009 draft – where even NBA Commissioner David Stern seemed to be half-asleep – the Washington Wizards still found a way to bring the right talent for their team and improve exactly where they needed… SHA-MON!