As Negotiations Continue, Same Questions To Ponder

Darius Soriano —  November 5, 2011

Today, after 8 days since their last meeting, the owners and players will resume talking about how to kick fans in the stomach again divide the league’s revenues and what system the league should operate under in order to bring the NBA back. As we’ve discussed in this space before, the sides are pretty close to a deal and only need to hammer out the details on the last few, yet significant, issues.

However, in the lead up to these talks, the rhetoric and positioning has only ramped up and become more strategic. Howard Beck is reporting that Michael Jordan leads a group of 10-14 hardline owners that will not go above a 50/50 split on BRI and would actually prefer the owners get a bigger piece of the pie in any agreement. Jordan taking such a strong approach can be seen as hypocritical as he has a history of saying some things about NBA ownership that mirror today’s players position. Or, Jordan can simply be taking a turncoat position and looking out for his own interests (it’s not like that would be out of character for MJ). Either way, the significance of Jordan being trotted out as the face of this movement is interesting to me because he is the lone owner that has a true history with the players the owners now oppose. His Jumpman brand is endorsed by several of today’s top players. He competed against many of these guys both as a Bull and a Wizard and the ones that weren’t yet in the league during his career likely see MJ as an idol. They know Jordan as the ruthless winner that always comes out on top, so for the owners to position him as a key cog in how these talks proceed surely has some psychological advantages.

That said, it’s not like the players are simply going to back down without making their last big stand in these negotiations. On Friday, reports surfaced of a conference call between players and lawyers with the union decertification being the main topic of discussion. The reports further state that a group of 50 players are seriously considering pushing for decertification – a measure that would disband the union for the purposes of filing an anti-trust lawsuit that could lift the lockout. Decertification would be the “nuclear” option as it would put this entire process into the hands of the courts and away from both sides’ leaders. Up until this point in the process the union has vehemently denied that decertification would be an option they’d explore. However, as the talks have progressed and the owners seemingly negotiating in a manner where offers are made, taken away, then put back on the table under the guise of “progress” and “concessions”, this small sect of players seem to be sick of it and are willing to take this step.

So, as talks continue with both sides showing their fangs to the media and putting on a public display of strength, we fans continue to sit and wait for the word that there’s a breakthrough. But, the same questions still run through my mind. Will the owners give anything back that can allow the players to save some face in these talks? Will the players finally succumb to the owners demands by giving everything the owners want by effectively folding? Will the return of the mediator keep both sides honest in these negotiations? The answers to these questions could prove to be the difference between a deal being made over the next couple of days or us not having an NBA season at all.

Darius Soriano

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41 responses to As Negotiations Continue, Same Questions To Ponder

  1. Darius,
    You are bemoaning the fact that fans don’t have any input, nor are they considered, in these negotiations.

    That is as it should be, because fans make up some of the worst general managers, owners, and talent evaluators in the world. It makes sense that you wouldn’t trust them with any type of negotiations about money or rules of the game.

    As this has gone on it has become more and more clear that it is only when the owners want to settle will there be a settlement – unless the players totally cave, of course.

    In this environment I really am starting to root for the players to decertify. This would possibly end the season, but it would be better than all the high-low extremes we are going through now. Also, this would really expose the owners who claim paper losses, but would now be faced with losing real TV money and long-term franchise value.

  2. As much as I miss the NBA – and trust me, I really, really miss it and actually feel kind of edgy around 7:30 as if there’s something I am forgetting to do – my antipathy grows daily towards the owners’ position. Let’s not forget that the owners STILL have not agreed to open their books to show how their ostensible losses are determined– they’ve given what they claim are the final numbers, but they are very cagey on the degree to which depreciation (absurd– a sports team or a stadium is not a computer but rather assets that appreciate enormously), loan interest (unfair/irrelevant), amount paid over book value (absurd), etc. factors into their analysis. Stripping away those accounting tricks (and not even considering the value that owning a team adds to the owners’ other businesses, especially real estate, there’s a very real question if any of these teams are actually losing more money than they are taking in on an annual basis.

    Trotting out MJ as the face of management is a repellent tactic that MJ should have the courage or at least the good sense to resist. I hope it kills his endorsement revenue stream going forward, but doubt it will….

  3. #1. Craig,
    Fans’ input should carry little value from a “they know what’s best” perspective, but should be respected from a consumer perspective. The popularity of the game that leads to ticket and merchandise sales, tv contracts and advertising dollars, etc is the money both sides are arguing over. So, I agree with your sentiment, but I also feel the need to point out that fans do have value in this equation even if they lack a position in the negotiations.

  4. Jordan has never in his entire life looked out for anyone BUT himself.

    It isn’t about a lack of courage for Jordan. It is, as Darius pointed out, completely consistent with his character that he now sides completely with owners now that he IS one.

    Not lost on him would probably also be a desire to harm the chances of a player like Kobe or Jordan to chase after his legacy. There’s nothing but upside for MJ doing this, and if there’s one thing that anyone who isn’t lost in hero worship should have been able to figure out over the last couple of decades it’s that the only upside that MJ has ever cared about has always been his own.

  5. Patrick O’Connor November 5, 2011 at 2:32 pm

    I’m pretty tired of Michael Jordan. Under the heading of what have you done for me lately we have his tee shirt commercials which feature semi geeky guys fawning over him in public (what other celebrity endorser does that?) and his ownership of the Charlotte Bobcats. By definition, the owner of the Charlotte Bobcats is a loser.

  6. What has been unsettling to me in the past week or so has been the unseemly efforts by paid media NBA announcers to bully NBA players to totally capitulate to Owners demands–to possibly save their jobs.

    Meanwhile, these weenies say virtually nothing about the damage that already has been done to the game–even before the Owners further water it down. The Owners appear unaware that they might use monopolistic powers to their own disadvantage.

    The season is too long.

    Hyping the invented superstar destroys team aspects of basketball.

    Just like in other walks of life, the rich players will get richer, the mid level players will disappear to the Euroleague, and fill-ins will contiue to water down NBA quality.

    The game has already been damaged, the owners are making things worse, and I hope that competition will emerge sooner rather than later.

    If the league starts up in two weeks, I can live with the pain the owners have cost us, but the damage won’t go away.

    When that first game finally happens, we’ll see a flock of rookies on the bench, and we won’t see any of the coaches or much of the staff. Even Jerry West will be gone. I haven’t heard about Kareem.

    I’m sure that we’ll see a whole lot more of Jimmy and a whole lot less of Jeanie–and Jerry might find it impossible to get away from his other entertainments.

    Wonder how thrilled Mitch is about managing the Lakers from now through the upcoming transitions . . . .

  7. I’m surprised that there isn’t a crafty agent or business man that is running around organizing a players’ league, even if only temporary.

    A pay-per-view 1-1 tourney of all the locked out players, or 3-3 tourney etc…

    Sure it may damage the NBA in the long term, but right now, what doesn’t?

  8. When LeBron and Wade left millions on the table to go sign in Miami,I believe it was a watershed moment for the small-market owners. Reinforced by Carmelo forcing his way out of Denver and then Utah giving up and trading Williams.

    The small-market owners no longer can believe that if they get lucky in the Draft they can build a long term contender as their star will leave them for brighter lights.
    If they can’t realistically hope to win a title,they might as well not lose money.
    And they either make a profit by cutting expenses(ie Player salaries) or getting the richer teams to cough up some serious bucks. The Lock-Out’s not ending til they get one or the other.

  9. This isn’t about money anymore, it’s about power.

    Each percentage point of BRI is worth about $40 million per year. Split among 30 teams, that’s $1.33 million per year.

    So the difference between the owner’s 50/50 share and the player’s 52/48 split works out to about $3 million per team each year.

    That’s the price of a mediocre backup point guard.

    I think the actual reason the owners are pounding on the BRI split is because from a public relations standpoint it’s easier to sell (“Wow! 50/50 seems fair…”).

    What they really want is the onerous luxury tax provisions and other restrictions on player movement.

    The owners aren’t about to let another Big-Three-to-Miami or Melo-forces-a-Knick-trade situation to happen again.

    Personally, I’d like to see the players decertify the union and file some antitrust suits.

    I thinks it time the owners were reminded that if they all died in a plane crash tomorrow, people would still show up to the arenas to see the players play. The converse is NOT true.

  10. Darius,
    I understand the fans do contribute something to the game. However, until we all stop supporting the game we won’t be taken into account by either the players or the owners.

    The players may be closer to the fans because they are the people we identify with on our team, but the owners will suffer the greater financial impact if the TV revenues and stadium revenues decline.

    It is sort of like withdrawing your money from a bank and placing it with a credit union. Until you do this the banks won’t listen to what you want. Of course afterward you may not want to go back.

  11. I miss basketball but I’m really rooting for the players in this. As someone who’s lived around the world and will continue to, well, if they have to go overseas and show the owners what they’re missing, well I hope they do. If the NBA takes a hit, other leagues will rise and occupy the vacuum. I hope the players counterpunch hard about how they are the ones who want to play and are being locked out (I still have ignorant friends asking me if they’re striking). They should continue to offer good PR whether by doing positive things in the community, engaging in other things in other settings, and in hammering the owners for their intransigence and greed. I’m wondering how much of the report by Beck was bait to try and see whether players could be further broken. I hope they remain strong.

    I want the league back Darius, don’t get me wrong, but this has nothing to do with me. Let’s be quite clear on that. We DON’T have a vested interest in this at the table. It would be nice to but ultimately this is about the division of power within a massive corporation and I hope that if the owners punch, the players punch back much harder.

  12. This entire situation is growing more disgusting by the day. NBA owners have already won these so-called negotiations. Why do they have to rub dirt in the players and fans faces in the process? Take your $1 billion+ you have gotten already and spare the rest of us the gloating.

    And Michael Jordan’s antics are a surprise to no one.

  13. Like others on here, I’m actually sorta-kinda hoping the players decertify at this point. Not that I’d like to miss a season, but the way the owners have “negotiated” (read: run roughshod all over the union, played the small-market fans for fools by trumpeting ‘payroll=parity’) ticks me off. The union really has had only 1 real bullet to fire back at the owners. Part of me hopes they take a stand a use it.

    Will they? Not for a while. It’d take 30% of the players to get on board just to take a vote, and I can’t see that happening. But I’d love to see the looks on the owners’ faces if the players walk in and do announce they’re dercertifying the union.

  14. What I want to see, honestly is this;

    Players threaten to decertify
    Big Market teams try to convince hawks but fail
    Dove owners create their own league
    Players play in that league
    Hawks get to see what they’re really worth.
    Stern’s out of a job.

    I know this ain’t likely, but it would create parity.

  15. From the associated press:

    “Union executive director Billy Hunter has long believed it was very possible that this season would be lost. He started to believe two or three years ago that owners intended to lock out the players so they could force through the changes they wanted.

    Fisher echoed that early Sunday morning.

    “We anticipated and expected to be here, that the NBA and their teams intended to lock us out for as long as they needed to in order to get what they wanted,” he said. “Our players are prepared. We’re aware.”

    Read more: http://sportsillustrated.cnn.com/2011/basketball/nba/11/05/labor.talks.ap/index.html#ixzz1cuRQpidF

  16. Jordan Farmar is blossoming in Europe, he is this weeks Euroleague MVP: http://www.youtube.com/watch?feature=player_embedded&v=RlDEsl9oj3c

  17. As things turned out, Farmar and the Lakers both might be better off today if he had stayed here. He might well have been the 2011-12* starter in the new system had he stayed.

    Also, the proposal about teams over the tax line not being allowed to do S&Ts is basically the “Keep Dwight Howard off the Lakers” clause.

    * include usual caveat

  18. As much as I want the Union to win, I doubt they have the mentality or even resources to fight a long draw out war as it is right now. Kind of like in 1998, the players sooner or later will break down, or in this case break themselves down, like Carmelo Anthony, and end up giving owners more edge in negotiation. So if I were them, I would accept the agreement, or else the agreement will be worst than what they will get now.

  19. Decertification would be an interesting move.

    If, in the end, the NBA teams will be able to hire players like any other business hires workers than I am all for it.

    I am sure the players who are screaming bloody murder about having to play for only 5 million a year (on average) would be willing to play for less than half of that amount – next year or the year after that.

    The owners have nothing to lose here – they will always have the stadium itself as a real asset. All the players will have is their bling and their ego and less years on their career. The owners are also probably better positioned to suffer the financial losses of an extended lockout and trial.

    Personally, I don’t see Pierce, Garnet, Rondo, Wade and LeBron investing their time in establishing an entire new league, which will take years to build and reach the level of profit that the NBA currently makes, and in which they will not be able to play anyway because by the time it is worth anything, they’ll be retired or very close to it.

    Basically, it is now down to the hurt feelings of some superstars, who have forgotten that the NBA that built them up, can also tear them down. Time to get back to reality…

  20. Basically, it is now down to the hurt feelings of some superstars, who have forgotten that the NBA that built them up, can also tear them down. Time to get back to reality…

    _____

    No. If it were like that, the owners would be using replacement players or threatening to. They’re not. And if the players really bailed, the owners would:

    a) Mostly vanish from the public’s mind. No one streams owners’ meetings on broadband, goes to games to watch owners, or buys suit jackets they see owners wearing.
    b) See their investments possibly blow up in their faces.

    But the players bailing would for them be a lot of work, a lot of sacrifice, including sacrificing more than half the NBPA, and a lot of risk, so the owners are simply using their structural advantages to stick it to the players. Most fans, being typical fans, go along with it unquestioningly.

  21. @Comment 20

    Tomorrow, there are 2 games to which you can buy tickets or watch on TV

    Game #1: The “NBA” in an “NBA stadium” with D-league players

    Game #2: Kevin Durant, LeBron James, Dwight Howard, Kobe Bryant, et. al. in an alternate league in a college fieldhouse

    Which one will get your money/attention?

    How much are the owners’ arenas really worth without the players?

  22. 22- Well, as I said, it will be very interesting to see how things will play out.

    As to the level of basketball being a measure of interest – there is ample proof that this is not the case at all. People watch basketball in Europe even though the level of play is, individually, weaker. Many people watch the college game even though the level of play is inferior to the NBA.

    So the question really is to what extent do fans watch basketball for its own sake/their hometown team/individual players-stars/other reasons. i have no idea.

    But I think that Stern has already proved that he can create interest in the game under very difficult circumstances. I’m willing to bet that the NBA will be able to do it again, even with different players.

    I can even imagine that in such a league the overall income will be down, but the margin of profit will be much higher for the owners.

  23. Yogi says:

    “Personally, I don’t see Pierce, Garnet, Rondo, Wade and LeBron investing their time in establishing an entire new league, which will take years to build and reach the level of profit that the NBA currently makes, and in which they will not be able to play anyway because by the time it is worth anything, they’ll be retired or very close to it.

    Basically, it is now down to the hurt feelings of some superstars, who have forgotten that the NBA that built them up, can also tear them down. Time to get back to reality…”

    I’m not sure it’s up to the hurt feelings of superstars. Personally I wouldn’t be surprised, as I said earlier, if that report by Howard Beck wasn’t planted propaganda by the owners’ camp to try and divide the players. That is a typical anti-union tactic. I agree that I’m not sure how the American public would respond if the quality of the league was diminished. I think the league would be surprised though at how many people would tune out the league even more and they would lose money and influence. As I’ve said, I’ve lived overseas quite a while and although players often miss the conveniences of home, I think that many of them would rather stick it to the NBA than to buy into a shady union deal.

  24. But I think that Stern has already proved that he can create interest in the game under very difficult circumstances.
    _____________________

    Actually, I think Magic, Bird and Jordan did most of that the first time, and then the Shaq/Kobe teams here drove it the second time. The third time? Laker/Celtic/Bull/Knick revival and LeDecision.

    Stern is a smart man, but like Napoleon, without the revolution, he would be nothing.

  25. Many people watch the college game even though the level of play is inferior to the NBA.

    ____________________

    That is largely because of geographic and alumni connections and also because people love the Tournament. A watered-down NBA would not have these advantages.

  26. @20 & 23

    Yes, people will watch all levels of basketball for all sorts of reasons.

    But will Jack Nicholson pay mega-bucks for his courtside seats to see D-leaguers play? I doubt it.

    Will ABC/ESPN/TNT/etc. pay top dollar for TV rights to a league that is barely better than college ball? I doubt it.

    Maybe the owners are sitting pretty right now because some of the money that supports the league is already “baked in” for the near future.

    But if, as the owners claim, they are losing money from not playing games, that has to start hurting after a while.

    And their not going to gain that revenue back if they start trotting out scab players.

    Just as no one goes to a movie because of the Key Grip or the Second Assistant Director, no one goes to an NBA game because “Wow, I really want to support our great owner!”

    If the NBA owners want to create a male version of the WNBA, where they play before crowds of 4,000 people and eek out a $2 million profit on a $10 million payroll, that’s their right. But it will make for boring basketball.

  27. From the initial action of locking out the players, the owners sent a clear message that they were going to force the players into submission. What I did not get then, and I am still not getting now, is why is the tail wagging the dog?

    Over the years, the players have increasingly shown that they were gaining in the understanding of what they bring to the table. The decisions of Wade, James, and Bosh last summer I guess exhibited too much player power, at least too much for the owners liking.

    With the present impasse, where the owners feel they are in the driver’s seat, the players should seriously consider eliminating the middlemen and take their product directly to the fans. This would give the players the 52% they now seek, plus the middlemen’s share which would put them well above the 57% they had before, and set the conditions for lowers ticket prices to the fans. Isn’t that what the OWS movement is all about?

    Looking forward to the Players’ Basketball League.

  28. The idea of NBA replacement players is funny. I can’t wait to see how many people shell out $100 to see a team headlined by Smush Parker and James Augustine.

    The NCAA must be loving this lockout. If this goes on for over a year (which I highly doubt), it’ll be the first time in my life I’ll seriously look at NCAA ball without a critical eye.

  29. I just can’t wait to get this whole thing over with.

  30. It sounds like the owners have given the players a “take it or leave it” offer and it appears the union is going to “leave it”.

    Which sounds like the whole mess will be heading to the courts eventually, and
    if that happens, the 2011-2012 season is DOA.

    To use another cliche, my fellow fans, this season is “on the bubble”.

  31. “The idea of NBA replacement players is funny.”

    It’s more than funny. It is downright delirious. Without LeBron, Kobe, Wade, Howard, Dirk, Nash, Garnett, Durant, Pierce, and others the NBA as we know it wouldn’t exist. Remove those top level guys and the NBA is no better than any league in Europe or Latin America (no disrespect to those leagues). Remove all 400+ players and it is worse than those leagues.

    And just in case anyone is confused, NBA teams are worth $300, $400, and $500 million dollars and up largely because of the overall quality and marketability of the league’s players. You water down the quality of the players and the value of the teams will plummet.

    However, just for laughs I would love to see the owners attempt to use replacement players.

  32. Well, true need to see quality players to play the game than watching amateurs in high school or collegiate…..true also that fans have varied opinions and not qualified to be GM’s or owners, that why they are called “fans”.

    Gosh, what we are doing nowadays, we ‘re narrowed down to a bunch of characters. Basketball has been replaced by wits of lawyer gladiators likes of Billy Hunter et al vs. a rebuttal from a dictator-liked David Stern….man oh man, it’s desperation time, I wish Chick is still alive. HELP

  33. It is really just the hard core (die hard) fans, such as the FB&G commenters that are truly suffering with a lack of professional NBA basketball, our favorite sport, along with lost jobs for some. I mention the lockout, and for some reason most people could care less, that I talk to about it. For me, I would either watch live or DVR every single Laker game in the season, and actively pursue my fantasy basketball team. Usually even to the detriment of my college grades, somewhat. Now, I have really settled in that I probably will not see any games this season, but there is still a sliver of hope in me that I am wrong, and I very much hope that I am wrong.

  34. Actually, replacement players can and will work because some of the talent will be drawn back to the NBA simply because paychecks won’t match.

    Now, sure the league will hurt without Kobe, Wade and LeBron, but if the league still had Blake Griffin, John Wall, and other players who don’t earn quite as much but have upside?

    I see enough fans and enough players returning, and of course enough owners having enough money and patience to make this work.

    Still, it would be interesting if the top talents went international and if that move could degrade the NBA into a ‘local’ league. That would be something the owners should be scared of.

  35. harold,
    That was my point a couple of threads ago.

    Just got back from reading comments over at Kurt’s website (PBT). Man, that stuff is really unreadable. Every time I visit I promise myself I won’t try to read the comments again.

    There are a variety of opinions over here, but at least people do a little thinking about the situation and don’t just spout nonsense.

    Thanks again people!

  36. Man, that stuff is really unreadable. Every time I visit I promise myself I won’t try to read the comments again.
    _______

    Indeed.

  37. but if the league still had Blake Griffin, John Wall, and other players who don’t earn quite as much but have upside?

    _______________

    Well, those guys aren’t “replacement players.” They are current and future All-Stars. Big difference.

  38. Jordan is doing what he has always done. Win! It is unfortunate for the players that Jordan is “playing” for the owners now. His team lost $20 million last year, no way is he going to let that happen again. Stern is smart letting Jordan take the lead on this new deal and ultimatum. NBA players and fans are used to seeing him push and bully players into getting what he wants. This is what NBA2K11 wanted to do- let an all time great push around the current players. If this deal gets done or of the 47% for the players deal is done everyone will know that Jordan can have his way with the players of today’s NBA just like he did with the players back in the day.

  39. After an extended period of planning, with no serious discussion with player representatives, the NBA owners unilaterally locked out NBA players and offered a specific long term contract, drawn to their terms, to end the lockout and resume normal basketball operations.

    Although the players have made concessions from the previous bargaining agreement, the owners have refused to substantially change their ultimatum, most recently put forward by Commisioner David Stern last week with an ominous Wednesday deadline.

    Should the players now bring in Clint Eastwood to say, “Go ahead, make my day.”? I really don’t see what else they can do, but perhaps there is some way to salvage the season.

    The problem facing Laker fans is that even without the lockout, the team faces a new management, complete with coaches and staff, under the leadership of Jim Buss. Anticipating significant transitions, the Lakers are without the veteran brain trust they have relied on in the past.

    As Laker fans, some of us worry both that there won’t be a 2011-2012 season, and that there will. . . . . .