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Malcolm Gladwell says owners shouldn’t expect to make money


Is owning a sports franchise a business or a toy?

Right now, the NBA owners are telling you the NBA is a business, and a bad one at that. One that needs to be fixed. Even if it means costing an NBA season.

But you look at owners like Mark Cuban and you see him treat it like a toy — he has said the Mavericks have lost money every year. He has been sued over it. He can kind of erase that on the books because he also owns American Airlines Center and he has said he will cover the debt. But he treats this as a toy and bought himself a title. (Go ahead and say the Heat are trying to buy a title, but the Mavericks paid $20 million more last year in salary and in the last decade only the Knicks have paid more.) Of course, Cuban has made his money on franchise valuation, that has flattened out a lot for owners who bought recently.

In an interesting piece over at Grantland, social commentator Malcolm Gladwell — he of Blink and Outliers and TED — says that NBA owners shouldn’t expect to make financial profit off a team. He notes that owners get a “psychic benefit,” an emotional benefit from owning the team that is what makes owning a sports team different than owning a car repair shop.

The rationale for the NBA lockout, from the owner’s perspective, goes something like this. Basketball is a business. Businesses are supposed to make money. And when profits are falling, as they are now for basketball teams, a business is obliged to cut costs — which in this case means the amount of money paid to players. In response, the players’ association has said two things. First, basketball teams actually do make money. And second, if they don’t, it’s not the players’ fault. When the two sides get together, this is what they fight about. But both arguments miss the point. The issue isn’t how much money the business of basketball makes. The issue is that basketball isn’t a business in the first place — and for things that aren’t businesses how much money is, or isn’t, made is largely irrelevant….

The Financial Times recently interviewed Diego Della Valle, the chief executive of the Italian luxury goods manufacturer Tod’s. Della Valle owns the celebrated Italian football club Fiorentina. “I ask if the decision to buy the club was made from the heart, or for business reasons,” the Financial Times interviewer writes. Della Valle replies: “With football, business reasons don’t exist.” Exactly.

The question to me has become, “has that attitude changed among owners?” I would say Gladwell’s perspective was true 20 years ago, it has shifted some now. The guys who form a partnership and spend hundreds of millions to get a team — guys who are leveraged — get their psychic benefit but do not let that get in the way of the bottom line. They are the hardliners pushing for change.

But should they feel that way? Or should they enjoy the psychic benefits (and the profits they will make when the team is sold) and stop treating their toy like a business? Not sure there is one simple answer to those questions.

Chandler Parsons out for Grizzlies’ opener

Memphis Grizzlies forward Chandler Parsons poses for a picture on NBA basketball media day Monday, Sept. 26, 2016, in Memphis, Tenn. Parsons signed with the Grizzlies in July. (AP Photo/Mark Humphrey)
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Chandler Parsons missed the Mavericks’ final 18 games last season, including the playoffs, due to knee problems.

Now with the Grizzlies, his games missed streak will hit 19.

Michael Wallace of

Maybe this is just a blip. Parsons will get healthy soon enough and diversify Memphis’ offense.

But Dallas didn’t make a stronger push to keep Parsons due to his knees. We could look back on this and chastise the Grizzlies for signing someone to a max contract who wasn’t even ready to play in the first place. They have big plans for Parsons, but he must play for those to work.

Brandan Wright just can’t get healthy. Maybe Memphis will believe this injury warrants missing time.

Ty Lawson makes the Kings’ regular-season roster

ANAHEIM, CA - OCTOBER 04:  Ty Lawson #10 of the Sacramento Kings attempts a pass between Yi Jianlian #11 and Jordan Clarkson #6 of the Los Angeles Lakers during a preseason game at Honda Center on October 4, 2016 in Anaheim, California.  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.  (Photo by Harry How/Getty Images)
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When it’s news your expected opening-night starting point just makes the team, you’re in a bad place.

But we already knew that about the Kings.

With Darren Collison suspended the season’s first eight games and Garrett Temple the only other point guard with a guarantee salary, Sacramento – despite his preseason problems – will turn to Ty Lawson.

Kings release:

The Sacramento Kings today waived guards Jordan Farmar and Isaiah Cousins, according to Vice President of Basketball Operations and General Manager Vlade Divac.

That allows Sacramento to keep Lawson. Lawson was a good starting point guard until last season, when he struggled with the Rockets and Pacers. Can he re-find the groove he had with the Nuggets? If so, the Kings might be alright. If not, they’re in for a rough start. That Lawson had to settle for a make-good contract says plenty about expectations.

Farmar was Sacramento’s other swing at an experienced point guard. Losing this job to Lawson bodes poorly for his NBA future.

With Cousins, the No. 59 pick, the Kings become the third team to relinquish rights on a 2016 draft pick already. The Celtics waived No. 51 pick Ben Bentil, and the Jazz dropped No. 55 pick Marcus Paige.

Archie Goodwin requests trade, Suns waive him

PHOENIX, AZ - APRIL 13:  Archie Goodwin #20 of the Phoenix Suns handles the ball in the second half of the NBA game against the Los Angeles Clippers at Talking Stick Resort Arena on April 13, 2016 in Phoenix, Arizona.  The Suns defeated the Clippers 114 - 105.  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. (Photo by Jennifer Stewart/Getty Images)
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Archie Goodwin had been stuck behind better guards with the Suns, most notably Eric Bledsoe and Brandon Knight.

But when Goodwin lost playing time to someone better and younger – Devin Booker – it became time to exit Phoenix.

Suns general manager Ryan McDonough complied.

Paul Coro of The Arizona Republic:

McDonough said they did not see a way Goodwin would play meaningful time in a fourth Suns season.

“We told Archie Goodwin and his agent at the end of last season that if there wasn’t going to be an opportunity for him to play going into the last year of his deal, that we would try to help him get to a good spot,” McDonough said. “We explored some trade scenarios throughout the summer and into the fall. We tried to help him get elsewhere in a trade.“

Unable to fulfill a trade request from the Goodwin camp, the Suns waived the 22-year-old

This allows Phoenix to keep two players without guaranteed salaries, John Jenkins and Derrick Jones Jr.

Jenkins, the No. 23 pick in the 2012 draft, previous played for the Hawks and Mavericks. He looks like a good spot-up shooter and shot well from beyond the arc in Phoenix after being claimed on waivers last season. But he was dreadful from beyond the arc in Dallas and has had other lulls prior. Despite quality defensive rebounding for a shooting guard, he’s a defensive minus.

Undrafted out of UNLV, Jones is a phenomenal athlete. But he needs to develop his skills and, at 6-foot-7 and 190 pounds, his body. He’s an intriguing project.

So was Goodwin, but the guard didn’t progress enough in three NBA seasons. He remains a lousy 3-point shooter and unreliable defender. His ability to penetrate goes only so far without better finishing or floor vision.

Goodwin’s athleticism and raw tools could convince a team to take a flier on him. But he has a long way to go to being a helpful NBA player. The team that knows him best being willing to let him walk says something.

PBT Podcast: Predicting NBA playoffs, Finals. Yes, meaning Warriors vs. Cavaliers

CLEVELAND, OH - JUNE 16:  Stephen Curry #30 of the Golden State Warriors reacts to a foul call during the fourth quarter as LeBron James #23 of the Cleveland Cavaliers looks on in Game 6 of the 2016 NBA Finals at Quicken Loans Arena on June 16, 2016 in Cleveland, Ohio. 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.  (Photo by Jason Miller/Getty Images)
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The Golden State Warriors vs. the Cleveland Cavaliers.

Like virtually every other prognosticator, we at PBT are predicting that as the NBA Finals as well.

Is having the same teams in three straight Finals good for the league? Which teams could get in the way of that rematch? Kurt Helin and Dane Carbaugh of discuss just that, including the Celtics, Spurs, and Clippers. They also talk surprise teams and the log jams in both conferences after you step back from the top few teams on each side. There’s a lot to cover.

As always, you can check out the podcast below, or listen and subscribe via iTunes (check there to see all the NBC Sports podcasts), subscribe via the fantastic Stitcher app, check us out on Google play, or check out our new PBT podcast homepage and archive at