Archives For Buss Family

The Economy and the Lakers

Kurt —  February 19, 2009

This winter, with the national economy tanking and sports team owners taking hits on stock and real estate, the market for baseball players shriveled up. Bobby Abreu goes to the Angels for just $5 million. Consistent 40 home run guy Adam Dunn to the Nationals for just $10 million. Manny Ramirez still doesn’t’ have a deal.

Except in the Bronx. There, the Yankees spent money like it was 2005, throwing out by far the three largest deals of the off-season.

How did they do that in this economy? CNBC’s Darren Rovell explains:

Think about all the other owners who have gotten pounded this year in the sector of the economy that they might still have their money in.

Think about the New York Mets, whose owners not only lost money from the Madoff mess, but also are in the real estate investment business. So too is Theodore Lerner, the owner of the Washington Nationals, who were hoping to land Teixeira. The Chicago Cubs are being sold by an entity that is bankrupt.

Go down the list and you can see that there’s a lot of people that lost money this year in other businesses. I have no idea where the Yankees are investing their personal money, but the bottom line is that their business is only the New York Yankees.

What does that mean? It means that as long as the Steinbrenners believe that the business of the Yankees will be good, they are not as affected as the others are. Will people still go to games? If not, will they watch the YES Network. It’s a pretty simple equation.

That brings us to Jerry Buss and his family, the majority owners of the Los Angeles Lakers. Buss made his money on real estate deals, but today he is in the Lakers business and very little else.

And right now the Lakers are a very good business, recession or no. The building still sells out at the highest ticket prices in the Association. The Lakers television ratings are up (unlike the Steinbrenners, the Buss family does not own the cable network showing games, but they do get a healthy payment). While Lakers officials said they have felt some pinch from sponsors, go to a game and it does not appear to be significant.

Just how healthy are the Lakers financially, as the second highest valued franchise in the NBA? This is what Forbes says (thanks to Darius for finding this info):

Based on the team valuations made by Forbes for all the 30 teams, the Lakers were pegged at US$ 534 million. Here’s the breakdown:

1. $123 million or 23% comes from the earnings from the league’s shared profits
2. $240 million or 41% comes from the value of the city’s market size
3. $140 million or 24% comes from the stadium earnings (ticket sales, merchandise, food, etc.)
4. $81 million or 14% is attributed to the team’s brand

Last season the Lakers were second in the league in operating profit at $47.9.

All of this ties into the big question for we Lakers fans — just how much is Jerry Buss willing to spend to keep this team together?

This summer, Lamar Odom, Trevor Ariza will be free agents. The Lakers if they pick up Sun’s option (his deal is two years) will have nine players on the books for next year with a payroll of about $74 million. This season, the luxury tax is at just higher than $71 million, but that number is expected to drop the next two seasons. (To really get a feel for what this means, read the excellent post from the always-amazing Tom Ziller over at Fanhouse. That guy should be bronzed. In a good way, not the Hans Solo way.)

Right now, in Jerry Buss’ head, there is a number of how high he will go. We can speculate all we want about it, but the fact is we have no real idea what that number is. We know he will spend more to win, but we also know he made some cost-cutting roster moves during the three-peat years to keep payroll under control.

Not only do we not know the number, we don’t know if it is possible to fit both Odom and Ariza under that number. Remember, if the Lakers sign both of them, they are still going to have to sign at least three more minimum level players (this year’s late first rounder, maybe Shannon Brown and another pick or free agent). The likelihood that the Lakers would keep Odom and Ariza and use the Mid-Level exception on a free agent seems almost nil.

If Kobe opts out and resigns a max deal extension, he will make about $1 million less (but will extend five years out). That is not a huge savings, but every little bit helps.

No doubt this Lakers roster, as is, can win — the Lakers have the best record in the NBA and are serious title contenders. The question is can the Buss family keep the band together.

One other factor in all of this is AEG, the company that owns 30% of the Lakers and the majority of Staples Center. AEG just spent insane amounts of money to build LA Live, the restaurant and entertainment complex across the street from Staples Center. This is a tough time to open a venture like that, and you need foot traffic to make it work. The kind of foot traffic that a sold-out Staples Center 41 times a season plus playoffs provides.

AEG cannot afford to have the Lakers slip. The question again is how much AEF is willing to pay to make sure they do not.

This is a hard topic, because reading into the Buss family and its finances is about as easy as bringing peace to the Middle East. There is no way to get 100% knowledge or certainty.

But it looks like they should be in position to keep the band together. Unless the market goes crazy this summer and a couple of band members get huge offers. Then, well, who knows?

It’s blown up all over — Jerry Buss sat down with reporters in Hawaii and said he’d consider trading Kobe. He doesn’t want to, but he’ll consider it.

There are plenty of people saying this “dumped gasoline on the almost extinguished fire,” but if Buss had come out and said “we will never trade Kobe” that is what would have set #24 off again.

If you read both stories (LA Times and OC Register) I think this is just Buss being honest about what happened this summer. First, Kobe goes Vesuvius. Eventually Kobe sat down with both Mitch and Buss and, as Buss said, they made their pitches and Kobe said he is still frustrated and would like out. Then I think they both told him “if that’s what you want, we’ll keep an open mind, but we’re not going to trade you for Luther Head and an expiring contract or two.” Buss said he’s kept Kobe apprised of the lowball offers that rolled in, so Kobe would understand.

If Buss had played to the fans and taken a hard line in the interview — directly contradicting what he told Kobe to his face — that is what would have destroyed what is left of his relationship with Kobe, it would have hardened Kobe’s heart toward opting out regardless of what the Lakers did. So Buss professed his love of Kobe, said he wants to make moves that would keep him here (“”I wish he felt differently. And if we win, I think he will feel differently. So we’ll just wait and see if we can win.”) and at the same time put other GMs on notice that they will not be taking lowball offers — come for real or don’t come at all.

And I’m not sure any of this is really a big shocker. Kobe knows that his frustrated outburst hurt his chances of being traded (or getting a trade that would help him out) so he will continue to say all the “good soldier” stuff. If Buss had taken any other tack in that interview, things might have been different.

Buss traditionally does one of these camp interviews, and he usually looks big picture. He’s got short-term issues (Kobe, not to mention Phil’s contract) but panicking on these issues is how teams end up with the Knicks roster from last season.

So, we wait and tonight watch game two of the Lakers and Warriors. As was said after the last game, the Warriors are a team that makes many a defense look disjointed. What we want to see is improvement — from players and the team — as the preseason wears on. So that is what I’m looking for.

Sick and Tired

Kurt —  May 30, 2007


It’s all about power. The last few days of the Lakers soap opera has been about power, the power to control the direction of the franchise. The power of trust. Kobe’s power as the star player. Jerry Buss’ power as the owner. Jim Buss’ power as the heir apparent. Mitch Kupchack’s power. Jeannie Buss’ power. Jerry West’s power. Magic’s power. Phil Jackson’s power to try to bring it all back together.

And I’m sick of it all, weary of the four-year-olds fighting over the sandbox.

Any regular reader of this blog knows how I feel about the soap opera surrounding the Lakers — I despise it. I like it as much as I like the trend of flopping. I started this blog in large part because I wanted to talk about the Lakers on the court at a time all regular media wanted to talk about what Shaq thought of Kupchak and who Kobe’s wife was talking to at games. I just wanted to talk about the games.

And yet, in the last few days I got sucked into the front office power struggle made public, the “who is the insider?” soap opera. Certainly all this impacts the team on the court, but it’s still more General Hospital than NBA professional. And I feel like I need a shower just following it.

Is it really all that hard for Kobe, Jim and Jerry Buss, Mitch, Phil and anyone else in the loop to sit down in a room and talk? Is negotiating through the media really necessary? Don’t successful organizations have a master plan that everyone is aware of and working toward? Isn’t talking things out face-to-face what good managers and mature adults do? Not everyone has been mature, but now everyone is being immature.

These are the days that try fans’ souls. It is the kind of day that makes me question my fandom (which Dan said so well) and makes me question blogging about it all.

Kobe says he’s tired of talking. I think I speak for a lot of fans when we say we’re sick and tired of this whole situation, too.

Maybe it costs me a bunch of readers, but I’m stepping away from the edge of insanity for a couple days. Write what you want in the comments, but I’m done updating who is fighting for what part of the sandbox for now.

I hope that Kobe and the entire front office can get on the same page, start pulling in the same direction. Like Kobe says in his latest diatribe, I love the Lakers as a franchise and want to see it return to winning. Maybe that is without Kobe, although I’d prefer him to stay.

But the last few days made me queasy. And I need a break from it.

The Downward Spiral

Kurt —  May 30, 2007

In case you missed it — Kobe just asked to be traded.

(Hat tip to Nate Jones.)

I always wanted this blog to be a calm, thoughtful space in the swirling vortex of controversy that can be the Lakers, but I really lack a good big-picture view here. I have but one big question:

Why has nobody from the front office talked to Kobe in the last couple of days?

Maybe they have tried and we don’t know about it, but from what Kobe has said he has not heard from them. To me, that sounds impossible.

He went public right after the team was eliminated from the playoffs, and I doubt his exit interview was a love-in. Now, nothing is going to happen fast — Kobe knows big deals are not made before the NBA Finals even start — but how come he isn’t brought into the loop more on planning? Then, when he goes to the LA Times and ESPN and starts putting on more pressure, how is it nobody from the front office takes charge of the situation, gives Kobe a call and talks him down off the ledge? How are meetings not set up? How do you let a “Laker Insider,” whoever it is in the organization, pick at the one sore scab Kobe has, the trade of Shaq? How do you not calm the man that lets you have $350 seats not even courtside (and puts butts in those seats)?

That, as much as any trade or shot down trade, shows the lack of a coordinated front office. This is basic management stuff.

Now, to be fair, I have heard Kobe do radio interviews in the past year where he said he has been consulted on trades, where he said, “Al Harrington isn’t coming here and I was consulted on the trade.” He has not been totally out of the loop, but exactly what concentric circle he was allowed into is a fair question. To use my own analogy, it’s like trying to figure out the Soviet government what is going on over there.

There are roughly a million problems with trading Kobe, which we can discuss if this really does move forward. There are a lot of problems with the Lakers making any big move (namely the lack of pieces that can be moved). But to me, the ball is in Laker management’s court. I want to see them do something with it.

Good point by Cary D. in the comments:

But Kobe is a hot-head as well. He’s not in the clear on this one. Has he ever picked up a phone (except to the press) to clear the air on a situation?

UPDATE #2: Nate Jones says one thing that crossed my mind as a possibility (and John R. said it yesterday):

Kobe’s been burnt enough by public relations in the past that he knows how to handle the media now. He’s playing all of us. I think he wanted to get traded but needed to make the Lakers look bad enough first to make him look like the good guy. And from what I’m reading around the nets, it seems like that ploy actually worked.

UPDATE #3: Trading Kobe will be very, very difficult. From the LA Times:

Bryant will obviously waive his no-trade clause, but he has a trade kicker in his contract that is believed to add about $13 million to his total contract value, a cost to be absorbed by any team that acquires him. The money would be paid like a signing bonus and would not count toward the salary cap. The Lakers had to pay a similar fee to Lamar Odom when they acquired him from Miami three years ago, paying him about $8 million.

UPDATE #4: Thanks to LG Gold for putting up in the comments the words of Jerry Buss (via Kevin Ding at the OC Register):

“We are aware of the media reports. However, Kobe has not told us directly that he wants to be traded. We have made it very clear that we are building our team around Kobe and that we intend for him to be a Laker his entire career. We will speak directly to Kobe and until we do that, we will not comment publicly about this.”

I think this supports what I said in the main post — Laker management has been too slow to react. They should have talked to Kobe already, they should have called him days ago.

Now, apparently, Phil Jackson has asked Kobe to calm down a little and wait a few days (via anonymous commenter who heard another ESPN radio interview). If Phil pulls this all back together, how much more power does this give him in the organization?

UPDATE #5: If you have not read the comments at True Hoop from Roland Lazenby, he gives his usual smart and reasoned take on the events, saying that the worst of this “Cuban Missile Crisis” can still be averted. (This is just a portion, go read the whole thing):

If I could do one thing to fix the Lakers? I would send Jim Buss off to owner school with his dad.

Shaquillle O’Neal told me in “The Show” that once Jerry West left, there was never anyone he could trust. (The hubris of the situation smells like the Bulls in 1998, when Jerry Krause determined to rebuild the Bulls.)

It’s a mess in the front office, especially if you’re a player in his prime who is ready to compete for a championship. (Someone pointed out to me once: with all the money the Lakers wasted on players like Brian Grant since O’Neal left, they could have paid Shaq his money.)

Jerry Buss is at an age where it’s transition time. I don’t know if anything can save it. The ideal thing would be for Jim Buss to stand up and say: “I’m going to let the personnel people do their job. We’re going to clear up the front office picture, and re-establish the trust that the players have a basketball person running the show.”

Kremlinology and the Lakers

Kurt —  May 29, 2007

Back decades ago, when the Soviet Union and the United States were embroiled in the cloak-and-dagger Cold War, there was something called Kremlinology. The simple definition is this — nobody really knew what was happening inside the very secretive Soviet government, so there were experts who tried to divine what was happening by reading subtle public cues. For example, who was standing near Brezhnev at the big May Day military parade meant a lot.

Trying to figure out what is happening in the Lakers front office usually involves some Kremlinology — Jerry Buss, good poker player that he is, tends not to tip his hand or thought process. The Lakers front office is really a pretty small group of people, and figuring out how decisions are really made is a bit of a mystery. How much power does Mitch Kupchak really have to make big moves? How much is Jim Buss involved day to day? There aren’t any May Day parades to see who is sitting next to Jerry Buss any given year.

More and more, this amateur Kremlinologist thinks Kobe’s recent campaign to bring pressure on management is part of an effort to get the various factions moving, ideally in the same direction. Recently there have been signs of a fissure.

There was Jim Buss on 570 AM saying he’s not sure Phil Jackson is good at bringing young players along (this after years where Jerry Buss had said he thought the triangle “boring.”) and says he doesn’t like Phil chastising his players publicly. Then his sister Jeannie Buss, who runs the business side of the operation and lives with the coach, goes on another show on that same radio station and says its ironic that Jim would publicly question the tactic of the coach to publicly question his players.

But I think the key thing Jeannie said is she had not spoken to Jim about this (and it was several days after the first comment). No communication there, and apparently not with Phil. Then company man Kurt Rambis comes on the same radio station and defends Phil, saying that Buss never comes to practice so how would he know how the staff works with young players. Then on top of it all Kobe brings up the specter of West (and now West is saying he wouldn’t come back and step on Kupchak like that).

It all reads like power is shifting some — Jerry Buss is giving up some of his and everyone is fighting for parts of it. Jim Buss is the heir apparent but as he asserts himself publicly (in a way his father rarely did using radio interviews) he steps on toes and finds people willing to fight back. Jim Buss said he would be willing to trade Andrew Bynum, but if (as has been reported) Buss was the guy who pushed for Bynum, he sees the kid or any fruits of the trade as his first stamp on the Lakers legacy. And so he is cautious in looking for the right move.

But cautious GMs tend to lead stagnant franchises. So do front offices where everyone is not pulling in the same direction. I guess we’ll just have to keep watching the clues to see where the needed leadership will come from.

Peeking into the future

Kurt —  April 2, 2007

The Lakers have always been somewhat shrouded in mystery — it may be the most prominent franchise in the NBA but it is run by just a few, a tight-knit family that rarely tips their hand in public (think the anti-Steinbrenners).

So last week, when heir-apparent Jim Buss did a radio interview on 570 AM, it was a rare glimpse behind the curtain to see what he and the Laker brass are thinking. Well, as much as he tipped his hand. I did not hear the interview, so I am relying on Ross Siler of the Daily News for the quotes (and thanks to Ian for providing the link).

Let’s look at what was said in a little detail, with Jim Buss quotes included:

“The way I look at it is I believed last year this current roster could win it this year. The way things are going, it’s going to be very difficult because we didn’t home court. We’d have to go through Phoenix, Dallas, San Antonio – – all three of them – – to get to the Finals.

“If we had played without the injuries that we sustained, then I think we would have had a home-court advantage and we wouldn’t have had such a tough road to get to. And yes, I would believe this team is good enough.’’

I think a large part of this is what you say in a radio interview, not what you believe in your heart of hearts. You always say this team could win it all this year, even if you run the Atlanta Hawks. At least I hope that is why he said this — if the top Laker brass really believed this roster was better than Dallas/Phoenix/San Antonio then we should be worried for the future because they clearly don’t judge talent well. I don’t think they are that misguided. This is a second-tier roster when healthy, one that needs another piece or two, they have to realize that.


The juicy part of the interview was when Buss said the Lakers were targeting bringing in a major free agent in the next couple of years, something they have been planning for.

“Those things start way before a player becomes available,’’ Buss said. “Everything we do is planning to be in a position if you can get an All-Star-caliber player to help your team go to the next level. You have to have it planned out years before.’’

As Rob L. quickly pointed out in the comments on this site, any signing is not likely to happen next year. The Lakers have $57.6 million committed in salary for next season, and that is before resigning Luke Walton (plus maybe Chris Mihm and Shammond Williams, and Smush coming back is not impossible), paying your top draft pick or filling a couple other holes. This team doesn’t have the cap room to make a big move this summer, unless it is a trade where Odom and/or Kwame are involved. But Buss said free agent signing, not big trade.

That following summer (heading into the 08-09 season), the Lakers have $45 million on the books (plus likely the Walton deal and more), which includes the last year of Lamar Odom’s deal. I’m not sure how much the Lakers could offer any free agent just like this coming summer. But that is the time-frame Buss offered up.

Now, the summer of 2009 is the summer Kevin Garnett can opt out of his deal in Minnesota. Would he walk away from $24 million? Maybe, is this the point at which a then 32-year-old Garnett is willing to take less money for a chance to win (alongside Kobe)? If, as Buss said, the Lakers are laying the groundwork for something this makes the most sense. That summer Lamar Odom’s deal will be up and the Lakers currently have about $33 million on the books, even with the added contracts they can have plenty of room to make an offer. Not a huge one, but a decent one.

Also, it makes the most sense because he can opt out. When the three-year deals for Wade, LeBron and others come due they are not just going to jump ship — their current teams can offer basically 30% more over the life of a deal. They are going to come in a sign and trade, because they are not going to leave that much money on the table. So you’d have to have valuable tradable assets to get them, and the Lakers do not and likely will not. The days of the Lakers basically winning the bidding war for Shaq are gone, you have to be savvy now.

“Mitch (Kupchak) is very good at watching the cap and so am I,’’ Buss said. “We have a plan to move forward and when somebody drops the ball and drops one of their All-Star players, we’re there to get them. You don’t go over the cap like some of these other teams and be mediocre. That’s like the cardinal sin in my book….

“What you do is you manage your money until you can spend it on the right thing. And it will happen. It will happen maybe next year or the year after but it’s going to happen. And when that happens, then we go right back to winning championships.’’

So apparently there is a plan. Of course, there was the 2007 plan which included the pipe dream of Yao or LeBron jumping ship. Let’s hope this plan is a little more realistic.