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February 25, 2010
A fan-friendly solution to fix the NBA
ESPN.com
by Bill Simmons
In the NBA, the owners are headed for a similar, "Wait a second, were we doing this the right away?" realization, if it hasn't happened already. The current system doesn't fly. The salary cap and luxury threshold ebb and flow with yearly revenue -- so if revenue drops, teams have less to spend -- only there's no ebb and flow with the salaries. When the revenue dips like it did these past two seasons, the owners are screwed.
They arrived at this specific point after salaries ballooned over the past 15 years -- not for superstars, but for complementary players who don't sell tickets, can't carry a franchise, and, in a worst-case scenario, operate as a sunk cost. These players get overpaid for one reason: Most teams throw money around like drunken sailors at a strip joint. When David Stern says, "We're losing $400 million this season," he really means, "We stupidly kept overpaying guys who weren't worth it, and then the economy turned, and now we're screwed."
...For instance, when I was in Dallas for All-Star Weekend, I asked an extremely wealthy person the following question: "Why haven't you bought an NBA team yet?"
His answer: "Because they're still overvalued. Anyone who buys in right now is doing it for ego only. That's why the league grabbed the Russian's [Mikhail Prokhorov's] money [for the New Jersey Nets] so quickly. He has a big ego and deep pockets, and he didn't know any better. He just wanted in.
Posted by eric at February 25, 2010 10:29 AM