Indianapolis, Kansas City, and the changing arena economy

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What do you look at to tell if a team is doing well? Attendance, right? After all, the way to tell how good a team is if they have fans coming to games.  Low attendance means you’re not making money. Sure, the Clippers are the exception, but it’s L.A. Everything’s overpriced. But attendance is still the real determining factor in success.

Right?

In the words of Dwight Schrute, “False.”

The real key to a franchise’s success is a more complicated algorithm that factors in sponsorships, partnerships, and attendance. But the attendance piece isn’t built on sheer numbers, but in quality.

The Dallas Morning News’ Mark Francescutti has an excellent article today outlining the success teams are having by doing something counter-intuitive. Slashing prices. The Mavs are obviously the centerpiece, with this money quote from Mark Cuban:

“Bottom line is that the upper bowl is becoming a smaller and smaller
part of our total revenue,” owner Mark Cuban
wrote in an e-mail to The Associated Press. “So we would rather
have a full house than make a couple dollars more. More fans means a
better home-court advantage, it means a better fan experience, which in
turn means more sales.”

The reason that the Mavs can make those kind of cuts is because the modern arena economy is now dependent on corporate suites and club seating. By focusing on those tickets, it allows the teams to fill out the big house.

This is why so many owners are requesting new arenas (outside of sheer greed). The modern economy has shifted to a sleeker, more efficient model and many older arenas are simply not fitted to that model.

Which brings us to the case of Indianapolis versus Kansas City. We told you yesterday about the Pacers potentially being sold for dirt cheap (that’s right, $230 million is cheap in what we’re talking about). One of the reasons a potential owner may want to relocate the team is because of the way the arena is configured.

Conseco Fieldhouse has 69 luxury suites. To put that in perspective, American Airlines Center in Dallas has 144 suites. Geez. Even smaller markets like the Rose Garden in Portland has 70 suites. Arco Arenas is severely behind with only 30 suites, one of the reason a new arena is a major issue in Sacramento. The Toyota Center in Houston has 80 suites.

Now, market size is going to be a huge factor, but so is how new the arena is, as well as what kind of club level seats are available. Kansas City has been a place discussed as a potential arena location for years, because they have a brand new arena, the Sprint Center, with no tenant. Huge building, no tenant. The arena also features 72 suites and a higher capacity for club seats than Conseco. So you’d have a similar overhead structure in a cheap city, with a building that maximizes profit, if you can fill it.

The arena itself is beautiful. When I spoke with Hornets’ guard Chris Paul at a preseason game in KC, he remarked that he “couldn’t believe how nice the arena was.” Everyone that attends an event there is stunned it’s so nice and even more amazed it has not regular tenant, outside of whatever Miley Cyrus/Jonas Brothers/Nickelback merchandise-fest is in town.

The public funding issue is going to be a problem anywhere in this country during the recession, but somewhere like Indiana with traditional Midwestern values is going to be even less likely to pony up for some new owner to build an arena he can charge more for to see a team that won’t be good for some time.

The Pacers are an institution. But this situation become representative of the changes going on in modern arena structuring.

UPDATE: Some interesting numbers on a few other arenas. The new Amway Center for the Magic will only feature 56 suites with 10 specialty suites. Similarly Charlotte features 67 suites, but does feature another 60 “lodge boxes.”

Additionally, a commenter points out that Conseco features two hosptiality suites, making for a total of 71 suites in Conseco to 72 at Sprint Center. It’s easy to argue that moving from Indiana to KC would be a lateral move, and a costly one at that.

Suns’ Markieff Morris, Archie Goodwin get in scuffle on the bench

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Just another magical day in the Valley of the Sun, where clearly Jeff Hornacek was the problem….

During an early timeout in the Suns’ game at Golden State, Markieff Morris tried to explain something to Archie Goodwin, who is seated. This conversation gets heated quickly, and teammates eventually have to step in and separate the two teammates.

The Suns have shopped Morris around as the trade deadline approaches, this isn’t going to help his value.

We should find out more about what happened after the game ends, although I’m sure both sides will play it down as “nothing.”

Kawhi Leonard drains game winner to beat Orlando (VIDEO)

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This is how much Gregg Popovich trusts Kawhi Leonard on offense now: Tie game with 13.3 seconds remaining, and the play design is a 1-4 flat isolation for Leonard. It’s the kind of play teams will call for LeBron James or Kevin Durant. Popovich just called it for Leonard.

And he was rewarded with a game-winning bucket.

Leonard finished with 29 points, LaMarcus Aldridge had 21, and the Spurs head into the All-Star break with a 45-8 record, on pace to win 70 games this season. And that still would only get them a two seed.

Hornets’ Michael Kidd-Gilchrist suffers shoulder dislocation, leaves game

Michael Kidd-Gilchrist
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Michael Kidd-Gilchrist had been back just six games after suffering a torn labrum in the preseason that required surgery. The Hornets had won four of those six, were playing improved defense, and looked like a potential playoff team in the East.

Now this.

He went straight to the locker room and did not return to the game (the Pacers got the win).

You can see the injury above. In a scramble for a loose ball, the Pacers’ Ian Mahinmi falls on MKG’s arm, dislocating his shoulder.

We don’t know the severity of all this and if MKG is going to miss time beyond this game. But it isn’t good.

Wife of former Pelicans coach Monty Williams dies in car accident

NEW ORLEANS, LA - DECEMBER 12:  Ingrid Williams, wife of New Orleans Pelicans head coach Monty Williams and other member of the Pelicans organization feed the homeless on December 12, 2013 at the New Orleans Mission in New Orleans, Louisiana. NOTE TO USER: User expressly acknowledges and agrees that, by downloading and or using this Photograph, user is consenting to the terms and conditions of the Getty Images License Agreement. Mandatory Copyright Notice: Copyright 2013 NBAE (Photo by Layne Murdoch/NBAE via Getty Images)
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There are no words to describe how sad this is.

Ingrid Williams, the wife of Oklahoma City Thunder assistant coach and former New Orleans Pelicans head coach, Monty Williams, died Wednesday at the age of 44 from injuries suffered in a car accident the day before.

Williams’ car was hit head-on by another vehicle that had crossed over the center divider, according to the Oklahoman.

The Monty and Ingrid had been married more than 20 years and have five children, ranging in age from 17 to 5. Williams is one of the better respected and personally liked coaches around the league, and the tributes have just started to pour in.

Our thoughts are with Williams and his family.