Close, But No Cigar….Yet

Darius Soriano —  October 29, 2011

Yesterday, Phillip wrote about how an 82 game season, compressed into a shorter time period, could potentially affect the Lakers. This was a topic of interest because going into Friday morning, both the owners and the players were optimistic about a deal being made to end the lockout. And with that optimism, came the prospect of still getting in a full 82 game slate for each team. Progress had been made on many of the “system issues” that derailed talks in other recent meetings and the only major issue left to tackle was the revenue split.

Then, as talks continued into Friday, lines were drawn in the sand. The owners still want 50%. The players still want 52%. Talks over. That optimism that was so fresh in the minds of the negotiators and the fans is now on life support as talks broke down again. And, on top of that, David Stern announced the cancellation of the remainder of the November schedule and that an 82 game season will not happen under any circumstances. Well, then.

That said, despite being fooled too many times to count by sides that seem to extend olive branches to the fans only to kick us in the stomach when we reach out to grab it, I remain optimistic. The sides are as close as they’ve ever been to finding the middle ground that will be the foundation of a deal. Nearly every issue is solved – or at least close enough that they won’t be the impediment to a deal.

With the sides this close, the rhetoric becomes less important to me as it takes a backseat to how close the sides actually are. So, while it’s disappointing to have talks break down again, I completely understand it. In many ways, it should have been expected. It makes sense that both would make one last stand to try and get the other side to move the last few feet in the deal. Those last few feet still represent close to a billion dollars in revenue over the life of a 10 year agreement and thus still represents the difference between a win, loss, or a draw in these negotiations. Remember, these are still prideful men and winning is what they’re used to.

That said, as much evidence we’d like to point to that says contrary, these men are not stupid. They know they’re within spitting distance of a deal and they also know both sides have moved a fair amount to get to this point (regardless of what you think about the owners’ starting position in these negotiations – a starting point I believe to be ridiculous, by the way – movement has occurred). At this point, I’d rather both sides take a short break to regroup and take stock in their respective positions to truly evaluate how much more they can move to make a deal. As I said yesterday on twitter, both sides have made concessions to get this close and now must take a look in the mirror to figure out what they can live with so an agreement can be made.

Meanwhile, we wait. Again. But as frustrating as that can be, it could all be over soon. Maybe it’s naive to think so, but when on a journey of this length and rigor, I have to believe the people in the room are smart enough to not turn around and go home after this latest stalemate.

Darius Soriano

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33 responses to Close, But No Cigar….Yet

  1. Hi Darius,

    You say, “. . .as frustrating as that can be, it could all be over soon. Maybe it’s naive to think so . . . ”

    Yes, it’s naive to think so–and most of us love you for it. The management ploy has always been to wait at least until the players felt some loss of paycheck pain–unless the players capitulated sooner.

    There will be a “deal” when the players capitulate–if they capitulate.

    That might happen next week–but I wouldn’t hold my breath.

    Of course, it also might happen for next season . . . .

  2. I agree… I’ve lost the tingle of optimism after the FMCS long-ass meeting but got nowhere. I wouldn’t say nowhere but it didn’t even cut the cigar.

    The fact that these guys think the world owes them for what they do is getting ridiculous.

  3. I respect your logic and your optimism, Darius. My own opinion in these matters swings toward a screaming death spiral but man, I hope you’e right.

  4. I always wondered where that saying ‘Close, but no cigar’ came from? An older buddy of mine told me that back in the old carnival days, you would throw a dart, and if it hit in the target spot you got a cigar prize, and if you just missed it was, well you know. I am not quite as optimistic about the season starting any time soon, I still think that it may possibly be totally cancelled, but if they are really only 2 percent away (1 billion dollars) from an agreement, who knows.

  5. In his most recent article for the NY Times, Howard Beck articulates some of the same logic I tried to convey while also stating the reality that the last steps will be the hardest. A couple of excerpts:

    “The new N.B.A. labor deal is practically done. You wouldn’t know it from the headlines, the dour news conferences or the apocalyptic rhetoric spilling from league officials. But the deal, in practical terms, is about 95 percent complete.

    The N.B.A. and the players union have agreed on contract lengths and luxury-tax rates, trade rules and cap exceptions, and a host of oddly named provisions offering “amnesty” and “stretch payments” and less onerous “base-year” rules.

    All of these pieces — some favoring the players, most of them favoring the owners — have fallen into place in recent weeks, even as talks collapsed and restarted and collapsed again. The checklist has been reduced to a few items.

    But it is the last 5 percent that is ruining the prospects for labor peace and gradually eroding the N.B.A. season….

    Neither side believes it can, or should, make another move. Their mutual intransigence has cost them a month of games and hundreds of millions in revenue.

    Yet if the negotiating pattern holds — and the breakdown in talks is quickly followed by another last-gasp return to the table — it should not take long to complete the deal.”

    Give the entire thing a read because he also gives great details on the items that both sides have already agreed to.

  6. It’s all on the players plate. The owners couldn’t care less if they blow the entire season, they got the leverage here…

    It’s just a matter of how far the players are willing to go. When the “final” moment comes, they will have to fold, no other options really…

    Players will have to drop their last offer at a certain point, we just don’t know when…And it will be something like 51-49 BRI + other things…But it’s just a matter of options: No season x player’s final offer. They’ll have to pick one.

    While the negotiations float around the 52-48 scope, it’s just bla-bla-bla…

  7. Darius,

    I have been talking about the potential ramifications of an Amnesty Clause as a vehicle to waive Luke but the way that the clause is being explained we could effectively waive Kobe in 2012 (because the owners are asking for more than one year to decide), get 75% of his salary off the books, get closer to the cap and sign say Deron Williams or Dwight Howard to a multi-year deal, and then re-sign Kobe for a minimal salary because he would still get paid his previous salary in addition. Am I reading this right?

  8. My comment is based upon Mark Stein’s article, not Howard Beck’s.

    http://espn.go.com/blog/truehoop/post/_/id/32935/more-flexible-amnesty-clause-on-way

  9. The lockout must continue, with all attendant vitriol intact, until the fundamental disequilibrium is fully addressed: multi-billion dollar entertainment ventures are a luxury that no society can afford at present. And the relative handful of genetic lottery winners who have become wealthy beyond the imagination of the average man need to be humbled. No basketball player would be worth a million dollars if no basketball game ticket cost more than $5. That’s where we’re headed, folks…the sooner the better.

  10. Personally, and I know I may be in a distinct minority here, I’d like the players to stand firm even if it means my missing more basketball.

    Think of the great players of the olden days of the NBA who fought and battled to get the union where it is today, even when it was personally painful for them and they lost out on some of their career earnings. They helped build a legacy by getting their successors what the owners are eager to continue chipping away at.

    Look at wage growth in the U.S. for EVERYONE, and yes, it is hard to make a case that NBA players are bad off, but there’s been an unprecedented transfer of money upwards across every industry in the U.S. that has coincided neatly with the decline of unions over the last couple of decades.

    That’s because there are few, if any, pressures and levers forcing “owners” of any kind to pay more to workers. Only a few years ago, the owners were literally crowing about how lopsided a deal that they made the players swallow. That same deal that they now say it is impossible for them to make money on? When the NBA hasn’t been this popular in years?

    **** that. The owners should not be saved from their own incompetence and the players union should not be under the mirage that they won’t be in the exact same situation a few years down the road.

    Giving in now won’t save them from losing games and paychecks in the future. In fact, it would almost guarantee we have another lockout the next time around. It will show, once again, that the players WILL fold if the owners apply enough pressure.

    Appeasement is a failed strategy against aggression in politics and it won’t work at the negotiating table against NBA owners. Unless the players want to lose even more the next time the collective bargaining agreement expires, they should stand firm now.

    Even if it means that this NBA junkie loses a few more regular season games or, god forbid, an entire season of Kobe’s few remaining years.

  11. Karyanr-
    You missed the point completely. Basketball players *are worth $1500 a ticket because people will Pay $1500 dollars a ticket. If the players took a 50% pay cut- how much do you think the owners will lower ticket costs? How much will they lower concession costs? What about Jerseys? I’ll give you a hint…the answer rhymes with hero.

    This is the society we live in, for better or worse. Capitalism drives our economy and players drive the NBA. They are worth what we will pay to see them and last year was a very good year in the NBA.

  12. #11 & #9 Understand too that the revenue streams related to TV and digital broadcasts are also huge parts of determining the players’ worth. Do you think the Lakers get their massive TV deal w/o Kobe or the Lakers’ history of driving fan interest (mostly through their ability to compete via the presence of elite level talent)?

  13. I couldn’t agree with you more, Darius. This league is a star-driven league. I don’t pay money to see college caliber players. I love the NCAA tourney and have gone to a few tourney games, but on the whole, I love watching great players and that is what the NBA provides. People happily pay $600 for the newest iPad, when that costs Apple $50 to make? They charge $600 because they *can charge 600 bucks. The owners are no different and the players are the high priced product.

    I don’t believe that bad owners, who make poor decisions, deserve to turn a profit. If you signed Gilbert Arenas to a craptacular turd-sandwich of a contract, then you deserve to lose money!

  14. #13 said “I don’t believe that bad owners, who make poor decisions, deserve to turn a profit. If you signed Gilbert Arenas to a craptacular turd-sandwich of a contract, then you deserve to lose money!”

    so true.

    if, as an owner, the team isn’t fun anymore and you’re losing lots of money, sell the team! even terrible franchises are easily sold at profit it seems…

    again, although there is a lot of business because of the NBA, the actual teams are NOT a business. they are a rich man’s luxury. if the cook can’t stand the heat, get out of the kitchen, he shouldn’t be a cook.

  15. I also don’t believe in siding with the players because they are the “poor” workers, although I do see why that is so advantageous. I side with the players because those are the people I want making the money that I pour in every year to see NBA basketball. Those are the people I pay to see. Although I also would want raises also for GMs since the GMs and their staffs are the reasons teams have good enough players to win. I’m more a GM guy than I am a coach guy.

  16. I also love that the owners are screaming about their offer getting worse because they wont be making money from the season. Wait? What? I thought you were losing money? Now you need the profits from the start of the season?

  17. Regardless of which side you fall in, it’s a forgone conclusion that in the end everybody loses…owners, players, networks, and fans.

    The only one probably coming out winners are the other pro sports. I’ve never watched so much MLB and NFL as of late.

    Incidentally who caught Phil Jackson’s commercial during Game 7 of the World Series. The man may be retired but he continues to send subliminal messages. The line “You don’t know the egos I have to deal with” was prophetic.

    http://www.youtube.com/watch?v=55QPT5vhk6E

    JLV

  18. Comments have been moderated/deleted. Read the commenting guidelines. Comments about politics, racism, etc can be taken somewhere else. I hope everyone respects my wishes on this. Thank you.

  19. cigar is coming soon. not as good as for somebody, before but it’s coming.

    btw i’ve been checking a pretty cool website the last couple of hours http://www.itsmyplay.com they bring together all the people involved in basketball. worth taking a look

  20. @10 – just now reading your comment… absolutely great. Kudos.

  21. (18) Darius,
    Besides the great writing and insight, that is one of the things that separates this blog from the rest and why many of us continue to read. thanks for keeping it classy!

  22. My biggest question is, “what will the new offer from the owners be after more games are lost?”

    Will Stern and the owners start offering 52-48? After a few weeks? Will the offers keep going down for the players?

    What will the offer be after a year?

    That is what Stern has proposed. Unless the owners continue to lower their offer the union will crumble.

    Wouldn’t it be great if the players and owners thought like business partners? If we bring in X amount of dollars there will be money redistributed back to players. If there was a shortage there would be X % detracted from their salary.

    Would that be an incentive to play your best all the time?

    A much more likely solution should be a floating split. If the revenue is higher than the previous year you give 52. If it is lower you give 50. If it’s the same you keep the previous year’s percent. Do that for the next 5 years and then take the avg % of that for the following 5.

    That way it would be in both parties’ favor to agree and stop losing fans so revenue can continue growing.

    I’m just frustrated that at the last meeting, both sides started at 52.5 and 50, then did nothing. That is zero progress. Wake me up when something happens.

  23. you know, let’s just remember that the reason that there’s no basketball is NOT because there’s no new contract. the reason there’s no basketball, is that the owners, wishing to crush the player’s union have LOCKED the players OUT from the workplace.

    they could just be playing basketball while the details are worked out. perhaps if there wasn’t a lockout, this wouldn’t be so hard to do. the players did not strike. that would be a whole different situation.

    it’s also worth remembering that the owners considered the last contract a major victory. this sounds like bumbling. you win and STILL can’t make money, even with record receipts. there is much about the story and the way that it’s covered(which is NOT finger pointing at this blog) that is bogus.

    the owners have a responsibility to the communities that they represent(whether they think so or not). they are allowed their toy, tax breaks, and keys to the city with the understanding that they will represent the city well with the gladiator battles that they put on, and that if they can’t do that, they have the responsibility to be entertaining and keep a significant portion of the community employed.

    i’m starting to think tar and feathers sounds like the right kind of party…

  24. I hate to sound like a broken record, but unless the owners can restructure their brains, they’re going to lose money period.

    All they need is a gentlemen’s pact on how much to bet for players’ services and that will eliminate the need for any ‘system.’

    Not quite sure if that falls under collaboration and market manipulation but they need not hammer things out with the union, just among themselves.

  25. Busboys4me, I believe what you missed on your analogy is the fact that whoever your team waives, you can no longer sign back to however much. You’d be restricted from signing him for atleast a year.

  26. NBA management unilaterally locked the players out and gave the union a take it ir leave it ultimatum.

    The players left it.

    The lockout was unilateral, not consensual.

    Why not let the players back in under old rules and continue negotiations as the season continues?

    That can be done unilaterally at any time, no?

  27. 22- Considering the fact players have come down to 52% from their previous figure of 57%. If “progress” is defined by movement, then the players have done their part. It’s the other side that is holding up an agreement.

  28. @27,

    I believe the owners do NOT want a season. They want to break the union in 1000 pieces…

  29. Unfortunately, Stern has a very bad attitude, and the owners are no better. They don’t respect the players not named labron. They somehow believe they can field a team full of “Novitski’s” and win. Foreign stars are still an anomoly, and the bulk of the league are “tatooed” city guys. That said, they still deserve to be treated fairly and respectfully. I’ve never heard of a union not negotiating a raise!!

  30. -27

    The players started the day of negotiations at 52.5 and didn’t move one inch.

    The owners started the day at 50 and didn’t budge.

    The owners started the negotiations at 38 % for the players, if this is the case then you could say 50% is progress too.

    The players are full of ego and will hold out for a few months longer. We will be starting in Feb.

  31. Thanks Warren for the clarification (25).