Somehow, you can always tie professional sports back into television money. That may include the NBA lockout.
Right now, the players deal on the table calls for them to take slightly less in in overall revenue (from 57 percent of Basketball Related Income now to 54.3 percent next season) with a five or six year Collective Bargaining Agreement (CBA).
The owners on the other hand proposed capping players salaries at $2 billion a year total (as a flat number not a percentage of revenue) and leaving it there for a decade long CBA.
As Sherwood Strauss reminded us at Hoopspeak today, there is an elephant in the room at these CBA talks not really being discussed.
2016 is when the NBA’s current national TV deal expires. This 2007-inked agreement promises pro basketball a total of 930 million dollars per year from ESPN and TNT, divided equally among teams. Stern netted the package during something of an NBA nadir, an ugly lull that did little to foreshadow this renaissance we’re all chomping mutton legs to in 2011.
The 2007 national TV deal? Well, that 930 million-per represented a 22% boost over the preceding arrangement (despite a dip in ratings the couple years before it)….
If the cost of NBA broadcast rights climbs after bad ratings, great TV ratings should boost the NBA’s televised value higher than helium-sucking angels. The league has been on a TV tear recently, culminating in 15.0 rating for the 2011 championship-clincher. Even before that strong finish, Mike Ozanian of Forbes wrote of a potential 3 billion dollar total increase for the next NBA television deal.
Now you start to really see what is at stake in this fight. If the owners got their way, all of the extra money from that looming increase in television revenue would go straight into their pockets without the players seeing a penny increase. (And the owners would still cry they are not making enough money — when was the last time you didn’t hear a CEO or business owner say they were making enough money?)
The players know that revenue bump is out there, too. Which is why they want a percentage of league revenues to go to salaries, and why they want to negotiate their next CBA right after that new television deal is put in place.
It’s just one of the many long-range plays to watch here when the two sides start to negotiate again. They know there is big revenue down the line… if they don’t screw it up with the lockout.