The National Basketball Association’s 30 franchises are worth an estimated 77.5 billion dollars. The NBA’s next national TV deal is expected to top $70 billion . The league is contemplating expansion. Average game attendance has not yet recovered from its historical pre-pandemic high, but it’s not far off.
The truth is, nobody can look at the NBA’s business fundamentals and seriously argue that this is a league in trouble. And yet, if you’re an avid fan of an NBA team and/or watch the league’s game product and follow league news and narratives, there’s a good chance that you’re dissatisfied. I know I am.
I hate that if you go to or tune into a game you cannot reasonably expect to see the best players of those teams suit up and play. I hate how player movement drama so often massively overshadows the actual game. And I hate how aggressively dumb and smug the personalities who front the league’s flagship TV products are.
The good news, for me, and for you if you share my dissatisfaction, is that I have a plan to fix the NBA. Not all of it, but a lot of it. And it all starts with re-negotiating the fundamental player-management power conflict.
The Draft (and standard rookie contracts) Sucks
Bad franchises get rewarded for being bad, great prospects get no say in where they live and work for at least 5 years, optimal development timelines get thrown out the window, teams are forced to make nine-figure commitments way too early, and all this mismatching and frustration leads to inevitable player movement drama and power plays.
Under this system, players have no power at the start of their careers, but then have way too much power as they enter stardom. And because teams are forced to throw 19 year olds into the meat grinder in order to justify their high selection, and because they have so little time to find out whether or not a player is worth making massive investments in, player development is severely hampered, and many many young players never reach their true potential.
There is a better way. Partly inspired by the MLB draft bonus pool system, welcome to the NBA Rookie Market.
An event held every year at the same time as the draft is currently, the NBA Rookie Market is an open marketplace where every single qualified amateur entrant is allowed to sign with whoever they want. So why wouldn’t all of them just choose to sign with the best teams and/or the most fun cities to live in? Because money.
In this marketplace, the worst finishing teams in the league have much more money to spend. At the end of the season, every team is given a Rookie Market bonus pool that they can distribute to the prospects they sign, with the amount determined by their finishing order. For example: In summer ‘22, Golden State would have entered the market with $4 million in bonus pool money, while Houston would have had $40 million.
This bonus money could all be given to one prospect, or distributed across a few. This money would not count against the cap, and would come from a central NBA pool. The money would be paid to the prospect over the first 4 years of their rookie contract.
And if a team wants, they could choose not to spend and roll over up to 75% of the unspent bonus pool into their following year's market.
So with all that, let’s see what this draft replacement looks like in practice. Let’s imagine an alternate summer 2023.
Detroit has come into the Rookie Market with $40 million in bonus money to distribute. Victor Wembanyama is a generational prospect, and this is not a hard decision. The Rockets offer all of it. What does Victor do?
Well Victor says no. The money is nice, but Indiana has offered their full $24 million pool, and Victor loves the pitch they gave him centered around their personalized organizational player development process, their medical team quality, and their exciting young core. For him, that more than equals the additional $16 million he’s missing out on. He’s joining the Pacers.
What does Detroit do now? Scoot Henderson is willing to sign for $35 million in bonus money. Amen Thompson and Brandon Miller will sign for $30 million. But Troy Weaver is not as high on them as consensus, so instead he signs Ausar Thompson for $16 million, and Cam Whitmore and Jarace Walker for $12 million each.
This process would play out with every team and every prospect until all the bonus money is gone. And at that point all remaining rookies can sign with whatever team offers them a standard rookie contract (more on that later).
When the dust settles, most of the best prospects will have signed with the league’s worst teams. But some of them won’t. Some of them will take less money to go to more developmentally competent organizations or more fun or commercially advantageous cities. And wherever they end up, every player will have had a choice, and every team will be working with a young man who chose to be there. And they’ll have the ability and incentive to actually invest in their long-term development.
Because in this system, rookie contracts would look very different too. There would be one standard non-bonus salary for all rookies, no matter what size bonus they did or didn’t get, and the length of the contract would be standardized to 5 seasons. But contracts would not begin counting until a player had spent at least 100 days on an active NBA roster, with a maximum delay of two seasons. Teams would now be able to have up to 25 active contracts, with a maximum of 15 on the active NBA roster, and unlimited movement between the NBA and the G-League (or a foreign league) until a player has accrued those 100 days.
The fifth year option would be gone, and there would be one year of restricted free agency following the final year of the rookie contract. Teams would be able to offer the exclusive super-max extension immediately upon the conclusion of the rookie contract.
Now that teams have up to 7 seasons with a player, and now that their ability to get prospects to sign is at least partly based on their reputation for development, the G-League will finally become the developmental system it was always meant to be. 19 year olds with raw handles and broken jumpshots will get to play in an environment where they won’t be benched for mistakes and where they get to take many, many reps with serious offensive and defensive responsibility.
Young players will get to play with each other and develop chemistry, learn the team's systems, and gradually integrate into the NBA roster as they mature. More of them will reach their full potential, and teams will have a better idea of who is worth giving mega extensions to.
The effects of such a system would be massive. To list just a few: 1) Reduced incentives to tank. 2) Better player development. 3) Better team cohesion and chemistry. 4) Reduced star movement.
There are some obvious issues that arise though, so let’s address them.
If draft picks don’t exist anymore, what can teams use to trade? Rookie Market bonus money! Teams can trade fixed amounts or percentages of their assigned pool in any given year, along with protections. So for example, at the deadline, the Pelicans could have traded their entire ‘23 $8.5 million pool and 50% of their ‘24 and ‘25 pool to the Raptors for OG Anunoby. And they could protect against catastrophe by capping the possible amount sent at $15 million in each season.
Won’t cynical owners/management keep players in the G-League past when they’re ready to move up in order to maintain team control?
Sure. But those that do will have a harder time getting prospects to sign, and even in the worst case scenario, prospects will spend just two extra years under team control. Considering the imminent end of one-and-done, and the continuing drop in average age of drafted prospects over the last 3 decades (there were 44 total under-20 year olds drafted into the NBA from its founding through the 2000 draft, there’ve been hundreds since then), this would just be restoring the onset of free agency closer to the historical norm, and would have the added benefit of delaying a players first big life and business decision until they’re a little more mature and have a better understanding of their career path. Everyone who was going to make money in the NBA will still make that money, it’ll just come a little later.
I would also add a contract clause allowing players on rookie contracts who have not accrued 100 NBA roster days to unilaterally end their deals and enter unrestricted free agency if they are averaging less than 10 minutes a game in the G-League (when medically available, disputes over that to be settled by independent medical arbitrators) after at least a season.
What’s to stop top prospects from taking the biggest bonus, playing out their five years, signing the exclusive super-max, and then forcing a trade?
Introducing the negative trade kicker. Any player on a super-max who gets traded automatically gets their salary dropped down to a standard max contract level. It’s that simple.
Woah. So what’s to stop teams from just dumping a guy if it turns out he’s more All-Star than All-NBA?
Introducing no-trade clauses. Any player can negotiate to have an NTC inserted into their contract.
Interesting. So teams can’t dump players, and players can’t force their way to a preferred destination while keeping the extra tens of millions they got for agreeing to stay with their organization.
Exactly. The next attempted super-friends formation is going to have to sacrifice real money in order to make it happen.
Any other cool ideas you want to share before we go?
Yes. Retained salary. Teams should be able to trade away players while retaining up to 75% of their salary, as in, they will still be responsible for paying that portion and that percentage will still count against their cap for the duration of the contract. This will make it possible to trade over-the-hill but still useful players who are finishing out a contract and get some value for them, instead of being forced to buy them out and allow contenders to pick them up for free.
Oh, and the season should be cut down to 72 games, and there should be a midseason global tournament with a $25 million prize for the winner to be split among all players who took the floor, and a $10 million prize for the highest finishing non-NBA winner. This would essentially be an extended mid-season break for vets, with teams giving much more of the playing time to youngins and G-League prospects.