At first glance its pretty easy to understand why NBA owners resorted to a lockout.  Its about finding a way for team owners to protect themselves from their own actions.   The lockout is also a way to close the ever-widening financial gap between large and small market teams, a gap that could destroy the gains the league has made in TV ratings, public perception and quality of play.   But the truth is this lockout is much more complicated than one might think, and is not one that very easily can be blamed on well-paid players or their union.

Are players at fault for demanding multi-million dollar salaries?   I don’t blame them, especially since these now angry and hypocritical owners so easily paid up.   I ask you: if someone was willing to pay you millions per year to do your job, would you take the money?  Of course you would.

But because of this reckless extravagance, too many NBA teams are losing money.  Unlike the NFL, most NBA owners have balance sheets deep in the red.   There are a number of reasons for this.

Television revenue is not spread equally among teams in the NBA as it is in the NFL.  There needs to be a fix for that. The way things are set up now, big market teams are able to extract more from their local TV deals than smaller market teams, which provides the big guys with a significant advantage when trying to lure high profile free agents and key role players.

There is also a market size disparity in some cases when trying to get corporations to pay for glitzy luxury suites, which is another way that large market teams make extra money to spend and profit from.

Labor negotiations are often difficult to explain to those who’ve never experienced the process.  It can be messy, complex and brutal.  But the edge here goes to the owners.  Unions of all kinds these days are having a hard time gaining public sympathy, which means very few people will be concerned that the world’s highest paid union members, will go without a paycheck for a while.

The fact is there is a real chance there will be no professional basketball next season.  The lockout could last that long.  Seven years ago, the National Hockey League shut down for an entire season to change the way it did business.  Several NHL owners also own NBA teams.  They might be willing to do the same thing with their basketball franchises.

Owners are serious about changing the business model of the NBA and making it possible for most if not all teams to finally make a profit.  But players are equally adamant that they not give back too much to owners who they say gladly signed their contracts.

Of course this labor dispute could seriously damage the remarkable progress the NBA has made.  Right now the NBA is as popular as it was during the Michael Jordan era, which was a rich and bountiful time for professional hoops.

But now as players, and big and small market owners, take sides, the real strength of the NBA will be put to the test.  The only good thing about this is that there are four months to go before the new season starts, which means time is on the side of an agreement being made – for now.

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  1. Kathy says:

    Hi David –

    Good article & presentation of the parallels & dissimilarities between major league organizations; basketball’s business model and revenue sharing plan is closer to baseball versus the NFL, right? Meaning the more popular your team, the more spending money you have,so the big get bigger & it becomes lopsided?

    These issues are fascinating and also so relevant with respect to labor relations. It is unfortunate the opportunity is not seized to engage the public in the theoretical issues at hand, such as profit distribution between labor and ownership. The most important issue is not necessarily the median salary of the “laborers”, it is also important to look at the underlying principles of revenue sharing between the owners and its work-force. Maybe. lol.

    Anyway – I LOVE basketball. Not just watching it, but the principle. It’s so much more democratic than most sports, with each player making a visible contribution and difference on the team. Theoretically, who really engages with each of the personalities on any one baseball team or football team? They have a couple of celebrity leaders, the rest of the guys are more like anonymous chattle. To me, the way I experience this facet of the sports is also a reason I prefer basketball, due to the way it reflects more of a dignified role for the worker, be he black or white, but so often black – it evokes the notion of “positive leadership opportunity”, as long as the athletes remember their dignity. Their role tends to be so much more individually influential, versus that of the often large, rage-filled, steroid fed barnyard animals that other pro sport images can evoke. Basketball affects me as more of a diverse and egalitarian sport, and as such as much more of the All-American sport than MLB or NFL.

    Could just be me. Hope they work it out, I want the NBA to succeed.

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