NBA Projecting $300 Million in Losses This Season, Commissioner Stern Says
The National Basketball Association is projecting $300 million in losses this season as it approaches the end of the collective bargaining agreement with its players union, league Commissioner David Stern said.
The NBA owners’ labor committee, headed by San Antonio Spurs owner Peter Holt, has been given permission by the full ownership to make a new proposal to the National Basketball Players Association in the next week or so, Stern said today at a news conference that followed a two-day meeting in New York of the league’s Board of Governors.
The figure Stern cited for the 2010-11 season was lower than loss estimates he made earlier today on ESPN Radio for previous years. He said in that earlier interview that the NBA lost $370 million two seasons ago and $340 million last season.
NBA Deputy Commissioner Adam Silver added that about 22 of the league’s 30 franchises are expected to lose money this season.
“Business has improved, nothing to be proud of, but we’ve reduced losses,” Silver said at the news conference. “We don’t believe, within this current system, we have the ability to move dramatically much more.”
While the NBA has had discussions with the union since the February All-Star Game, there have been no formal bargaining sessions in that time, and neither Stern nor Silver would discuss the specifics of what a new proposal might contain.
The league previously cited the need for a more favorable revenue-sharing agreement, a hard salary cap, the end of guaranteed contracts and shortening of contracts as the top negotiating points for the owners.
“The goal remains the same, to create a system in which all 30 teams can compete for a championship, and if well managed, have the opportunity to make a profit,” Silver said. “There are other ways to reach the same goal.”
Dan Wasserman, a spokesman for the players’ union, said in a telephone interview that he was unable to immediately respond to the NBA’s comments because union Executive Director Billy Hunter was sick and unavailable.
Certified annual reports from NBA teams from both the 2008-09 and 2009-10 seasons have been given to the union by the league, Stern said. The expiring contract was signed in 2005.
“We didn’t anticipate cost expenses to rise as quickly as they have in virtually every area of our business, and we didn’t anticipate that the world would change in essence,” Silver told reporters after the news conference. “There’s been a sea change in the global economy since we negotiated our last deal.”
While both the NBA and union agree that some teams are losing money, Hunter has said it is only a small number of franchises in a system that could be fixed by better revenue sharing among the owners.
The union between November and February handed out a 56- page “Lockout Handbook” to its players to help them prepare for the financial difficulties of a work stoppage. In the guide, Hunter warned that “a lockout is VERY likely.”
The NBA’s last work stoppage began in 1998. The 1998-99 season was shortened to 50 games from 82 following a lockout that ended in January 1999. It’s the only time in league history that games were missed because of a work stoppage.
“It doesn’t take that long to reach a deal,” Silver said today, with the deadline 2 1/2 months away. “It’s a question of whether there will be movement.”
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