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How the lockout could have been avoided.

Stern and the NBA owner's stay they want more team profitability and competitive balance and that is why they have taken a hard line with the players during this most recent CBA negotiations.  The problem is they were barking up the wrong tree.




Basketball like all sports is an entertainment business. Now in sports a team makes money when it is successful and/or can attract marketable star talent. Now I understand if you cannot put a competitive franchise on the court you probably will not make money.  So if I was a small market owner I would be talking about competitive balance too. Because the better I can compete the more money I will make.

 

Let me make this clear, player salaries do not impact a teams profitability one bit. Some of the NBA teams that reported the biggest losses also had the lowest payrolls and some of the most profitable teams had the highest payrolls. So in the long run lowering payroll will not make the Glen Taylors or the Michael Jordans of the league any more money than they are making now. What effects the bottom line is improving fan interest and marketability of your franchise. NBA basketball is a consumer driven business and as any consumer driven business the profitability of that business is less related to the cost of the product than the popularity of the product.  Frankly speaking far too many NBA franchises are far too unpopular with consumers to turn a profit.

 

So how do you fix the popularity problem. I have a simple answer change the Larry Bird exception. The original intent of the Larry Bird exception was just as it sounds. The Celtics were over the salary cap and petitioned David Stern to allow them to sign their superstar player and biggest crowd draw Larry Bird. Without that exception Bird would have been forced to sign with another team.  Now to me the Bird exception was the first step into the abyss. It allowed the Celtics to keep a star player instead of letting him go to possibly make another team competitive.  But we can use this exception to satisfy all parties.

 

I would restrict the Bird exception to one player per roster and not allow a team another Bird exception while they had a Bird exception player under contract.  Remember the real intention of this exception was to allow teams to keep their superstars, so it does not make sense that Jared Jeffries has bird rights. I would then allow that team to go outside of the salary scale to pay that Bird exception player, while forcing all other teams wishing to sign that player to comply with wage scale. So for example last season I would have allowed Dan Gilbert to declare Lebron James a bird exception player, and therefore he could have offered Lebron as much as he wished for him to stay. Under present rules the difference that a team can pay its own max free agent is not significant enough to present a real competitive advantage. What if Gilbert could have offered Lebron 30 mil to stay in Cleveland? Maybe Lebron would have found it harder to take his talents to South Beach. Or maybe Chris Paul would find it harder to take his talents to Broadway if he was leaving that kind of money on the table.

 

Now in order to increase competitive balance you have to make it harder for perennial playoff teams to keep talent and easier for non-playoff teams to acquire talent. Therefore you need a two tiered system. Now if you are a team that has not made the playoffs in the last two seasons but sign a player using the Bird exception, say the Wizards with John Wall, I would allow his salary not to count against the cap for two years. Therefore if the Wizards manage their cap right they can keep Wall and have money to sign other players to put around him. For playoff teams your Bird exception player counts in year one. So if the Lakers decide it is worth 30 mil to keep Kobe Bryant in LA for example, that means if they cannot get under the cap to sign Pau Gasol then they would have to let him go. Under this system playoff teams would be forced to prioritize free agent players. So 2nd and third tier talent would be constantly on the move, and if non playoff teams are the majority of the ones with the most money some of those players will land with those teams. So in this hypothetical the Wizards keep Wall and may also have the money to sign Pau Gasol. A team with Wall and Gasol on it should be able to compete for a playoff berth, which increases fan interest and profitability.

 

The above strategy is a large reason the NFL has such decent competitive balance. Now the NFL has a much harder cap than the NBA. NFL teams can spend up to the cap but there are few exceptions that allow them to spend over it. As a result a lot of good players change teams. In terms of player movement the NBA is a maximum security prison compared to the NFL. Twenty-three pro-bowl players changed teams this past off-season and that turn over is about average. Imagine if in the NBA 10-12 All-Stars changed teams every year, instead of the 2-3 on average that change teams now.

 

Simply by making tweaks to the Bird exception the league can increase competitive balance and allow more teams to turn a profit. The owners would get the balance they want, and the players would get the money and free agent movement they want. Sure a Pau Gasol , Chris Bosh, or a Manu Ginoboli might have to leave playoff teams to go to rebuilding ones but they would still be able to make max money to do so.

 

So they NBA could have just rolled over the old CBA avoided these confrontations and fans could have had basketball, while players and owners could have gotten everything they said they wanted. Given that most of these people are smarter than I am, I am going to assume that there is a more nefarious agenda in place here.

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