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Yet Another Lockout Rant

In the doldrums of the NBA's long offseason, made longer than usual for Laker fans due to Los Angeles' unceremonious exit from the Playoffs; real news becomes scarce, something exacerbated this offseason courtesy of the lockout eliminating player movement for the timebeing. The combination of lack of games and lack of news make life hell for a hardcore fan, and may well turn a casual fan off the sport; thus reducing fan interest and potentially hurting future demand for the NBA product. Oh, and not to mention both the NBA and individual teams have already begun to lay off employees. But this lockout is meant to make the League more profitable, yeah? And the reason the NBA doesn't contract teams or shut down the WNBA is because of the jobs that would be lost? Sure.

As you may have been able to tell, I'm well in the player's corner of this labor spat. As the adage goes, nobody pays to see the owners; and I'd bet that it'd be easier to find 25-30 people/groups able and willing to own an NBA team than it would be to find a single Kobe Bryant, LeBron James, Dirk Nowitzki etc. This isn't the NFL, where the League literally ran replacement players during a lockout and it didn't hurt them too bad. The NBA is built on the marketability of the players moreso than the sport itself, and the owners need to recognise this.

And indeed, there are prospective owners looking to buy into the League. Even in the hard-run small markets like Sacramento, there are individuals willing to buy Franchises off of the hands of owners who believe the team is not profitable under the current, 'broken' system. In a free market, one would assume that if the League were truly 'broken', then one would have no incentive for buying into it. So are the prospective buyers the idiots? Or is it the likes of the Maloofs, who're near-bankruptcy and have made plenty of questionable decisions in the past? I'd tend to lean with the latter, particularly considering that with offers on the table for a team making consistent losses, if the Maloofs believed the system was broken they'd be stupid to not take any reasonable offer.

This is important because David Stern specifically states he's aiming for a system which would accomplish the goal of "making sure that where we are now, that 30 teams, if well managed, have an opportunity both to compete and to make a profit". With owners like Donald Sterling (who is admittedly making a profit, but only by virtue of being in LA and short-changing his employees), the Maloofs and Robert Sarver running around, it's no wonder the League 'lost' $300 million dollars (I don't doubt that the League's used accounting wizardry to inflate this figure, as that's simply standard business practise, but I'm not an accountant, nor do I have full access to the League's logs, so I'm not going to go into it - I'd suggest reading this if you're interested). Indeed, one could argue that, considering David Stern's wording there, perhaps he should experiment with a League that is actually well-managed before insisting the CBA is broken.

The cycle of mismanagement isn't limited exclusively to the ownership level, either, with the League itself conducting activities that from a pure economic standpoint are undeniably counterproductive to their goals of secured profits, such as running/marketing the WNBA and NBDL at significant losses and having teams placed in markets simply not built to sustain them. Perhaps if the NBA owners and the League as a collective were so desperate to ensure yearly profits along with the significant portions of money they're likely to make when they eventually do sell their teams; they would invest in moving teams. A drastic measure, true, but so is laying off 11% of the League office workforce and potentially losing a whole season of play. Easier methods are also possible, such as efficiency and some restraint - the decadence of the NBA at a League level is well-documented. Oh, and why is contraction such a feared concept? Job loss? Already happening, League-wide. A city losing its team? Ultimately, as much as its dressed up, the NBA is a business same as any other, and if a city doesn't provide the requisite levels of demand for it to be financially viable for a team to operate there, movement is necessary. Relevantly, the NBA lost $300 million last year. That's pretty much exactly the amount they paid George Shinn for the Hornets, and whilst they'd likely have to pay a similar fee regardless if they wished to contract the team, every year they own the team will incur further losses.

Ultimately, it seems to me the primary issue in this matter is the bullish nature of many owners, both young and old. A nature mirrored in David Stern, it seems the owners refuse to acknowledge any mismanagement, wrongdoing or failure on their part that would assign them even the slightest modicum of responsibility for their claimed losses; instead blaming a Collective Bargaining Agreement which, despite having lauded as a great success at its inception, owners now claim to be 'broken'. The NBA's growth rate according to Forbes is at around 5%, better than most businesses in this economy, and their operating margin is at 5% also, both favourable figures that certainly do not imply a 'broken system'. Oh, and the operating margin would be at record highs if not for the greater-than-proportional increase in non-player expenses by the League, i.e. the aforementioned WNBA and running a freaking NBA franchise because they refuse to contract it. Doubtless, the players need to make some concessions - 6-year contracts are too long, I would argue, for example; but the lion's share of the blame for the NBA's current debacle lays at the feet of the owners; who would throw a max contract at Joe Johnson and then blame the system for allowing them to do so. It remains to be seen how this lockout will be resolved, and whether player actions such as harping on about playing overseas will help their cause. However, considering many owners were making little or negligible money from their franchises last year, and many owners have significant alternative avenues of income, I don't see them blinking first. Way I see it, either the Players Union can decertify and probably lose the season in complex legal proceeding with some chance of retaining their rights; or they can simply sit and do nothing, losing a season in the vain hope that the owners will concede, before folding, and saving nothing. Either way, I don't foresee any manner in which the season is saved for the fans.