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Comparing markets, attendance and ownership in Sacramento and Seattle

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We’ve discussed the issues that will determine whether or not the Sacramento Kings stay in California’s capitol or go to Seattle, including the impact of public subsidy support in both cities, the race between the two cities for an arena deal, and what lawsuits pending in Seattle mean to the process.

Next we take a look at markets, attendance, and ownership groups for both locations.

Sources with knowledge of the league’s thinking tell PBT that neither city will have a discernible advantage in these areas heading into meetings with the Board of Governors joint committees on April 3.

Seattle enjoys the nation’s No. 12 television market but shares that market with up to six sports teams, an issue that has come under great scrutiny when comparing Seattle with Sacramento, something the Sacramento side brings up often.  David Stern pointed the issue out at All Star weekend, Chris Hansen’s group reported the same idea in its market analysis, and Sacramento’s group highlighted the same thing this past week when they unveiled their market analysis to the press.

A potential Sonics franchise would share Seattle’s larger market with the Mariners, Seahawks, Sounders, and University of Washington football, in addition to an NHL team if Hansen’s group can make it happen.

That would reportedly position Seattle closer to Sacramento’s No. 20 television market, where the NBA enjoys 100 percent market share.

Think Big Sacramento, the city’s arena task force, put out a report this week contending that they are a better market than Seattle, which is what they’re supposed to say, but when you look at a similar report put out by Chris Hansen’s group the two sides aren’t necessarily squabbling over the details.

Hansen’s report indicates that Sacramento has 1.4 million TV homes per team (NBA, NFL, NBA, NHL), compared to 937,000 TV Homes for Seattle under the current scenario of two sports teams (Mariners and Seahawks) already in town.

Under this metric, Sacramento ranks No. 2 and Seattle ranks No. 4.  Orlando is ranked No. 1, L.A. is ranked No. 3, New York is No. 5, and from there it goes Atlanta, Philadelphia, Houston, Chicago and Dallas — mostly large markets.

Should Seattle secure both an NBA and NHL team they will fall to No. 15 on Hansen’s report.  If you add the successful Seattle Sounders MLS franchise to the metrics as Hansen’s group does, then Seattle falls to No. 21 assuming they land two new pro sports franchises.

League sources say the TV Homes per team metric is one of the reasons small-to-mid markets like Orlando, Sacramento, and Seattle are coveted by the league.  Networks understand the competitive impact of multiple sports teams in a region that steal away eyeballs and ratings, and they include such analysis in their bids for rights packages and the like.

Otherwise, leagues would contend that ‘TV Homes’ never watched any of the other sporting options available to them, and instead just the games that a particular league is selling to a network.

Still, Hansen’s report states that Seattle (84) has 30 more businesses than Sacramento (54) with 1,000 or more employees, and Seattle’s household median income is ranked No. 6 ($66,500) compared to Sacramento at No. 8 ($63,618). However, if you use the 2011 federal numbers for the counties of these cities (King County and Sacramento County, and work to draw fans outside the city limits) that gap grows to more than $15,000 a household.

Just like other professional teams cut into the NBA’s TV viewership in Seattle, sources say the same issue mitigates the advantage the Emerald City has in terms of potential sponsors.  The issue was summed up by longtime Seattle writer Art Thiel, as he said in a recent roundtable discussion between local pro- and anti-arena groups that competition for sponsorships in Seattle could be a problem.

“Which team in Seattle is the sixth ticket in town? When you consider Seahawks, Mariners, Sounders, University of Washington sports and then these two new teams that might occupy Hansen’s arena … the complicated business problem in Seattle is that our major companies here like Amazon and Microsoft are either bit or ‘no’ players in the sports sponsorship scene. They don’t buy the suites, they don’t do the sponsorships at least at the same degree as you find elsewhere with Fortune 500 companies.”

At his State of the City address last week, Sacramento Mayor Kevin Johnson revealed that he had sponsorship commitments of $50 million over five years from local businesses, which is similar to the $10 million Johnson secured when the Maloofs tried to leave for Anaheim in 2011.

It is unclear what Seattle has presented to the league on that front, as Seattle supporters have maintained that Hansen is under a gag order and cannot talk about his proposal to the press.

As for Hansen’s arena task force marketing itself or leaking information to the media about sponsorship support in Seattle, league sources do not expect the group to be public about their position.  As they put it, “when you’re trying to take a team from another city, particularly one that is fighting as hard as Sacramento is, it pays to be quiet.”

Past attendance will likely be a moot point or favor Sacramento, as Kings fans have turned out at the gate more frequently than their Sonics counterparts over the years.

Given the constant relocation threats and substandard ownership over the past five years, sources say the league is impressed that Kings fans continue to show up the way that they did, just as the league was impressed with Sonics fans when they showed up for the last two years under Clay Bennett prior to the team’s move to Oklahoma City.

Sources say the league won’t be overly critical of attendance in either city once public relations became a nightmare.  This was the case starting in 2006 in Sacramento after the Maloofs torched an arena deal and in that same year when Bennett took over ownership of the Sonics.

Ownership groups are another area in which sources tell PBT that the league is likely to conduct itself with some ambivalence.

Steve Ballmer is ranked No. 51 on Forbes’ top billionaires list, while Chris Hansen, Ron Burkle, and Mark Mastrov are not listed.  Each ownership group is “overly qualified” to own an NBA franchise, and the sports connections each group brings to the table are regarded as second-to-none.  Burkle is a finalist to purchase sports and entertainment powerhouse AEG, while Ballmer’s wealth alone is enough to make most owners blush.

Sources with knowledge of the league’s thinking said this is a great problem for the NBA to have, but pointed out that the league is highly unlikely to make this a question about which ownership group is better, instead letting the other factors decide the matter.  “There are only so many yachts these guys can water ski behind, and while Hansen and Ballmer are a dream team when it comes to ownership, it’s doubtful the NBA is going to downgrade Burkle and Mastrov.”

The source added that it didn’t make sense for the league to pit the ownership groups against one another, noting the association still wants to do business with both well into the future.

After David Stern’s press conference on Friday in which he said the Sacramento offer needed to be increased, and subsequent votes of confidence from Mastrov and Johnson that they would be able to deliver, the framework for discussion among owners is all but laid out.

Assuming Sacramento can provide the right offer, with the two cities drawing toward a tie on the issues of markets, attendance and ownership groups, the source said that with the advantage Sacramento has on the public subsidy issue, “Tie should go to the runner.”

Bull for Bull: Pau Gasol to replace Jimmy Butler in All-Star Game

MINNEAPOLIS, MN - FEBRUARY 6:  Pau Gasol #16 of the Chicago Bulls prepares to shoot a free throw against the Minnesota Timberwolves on February 6, 2016 at Target Center in Minneapolis, Minnesota. 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 2016 NBAE (Photo by David Sherman/NBAE via Getty Images)
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Jimmy Butler is out of the NBA All-Star Game in Toronto this weekend due to a strained knee. Which suck, because he earned that spot, and while the fans didn’t vote him in the coach’s did.

Butler’s teammate Pau Gasol will replace him.

NBA Commissioner Adam Silver gets to make the call on a replacement, and he stayed in Chicago, but he added a front court player to replace a guard. Keeping a Bulls representative might have been part of the thinking. The coaches’ votes on replacement players has been weighed in the past (Gasol may have been high on that list, coaches love him). Also, the East roster has a lot of wings and was light on bigs (Andre Drummond, Paul Millsap and Chris Bosh are the only real bigs), so this gives coach Tyronn Lue some flexibility up front.

The East leading Cleveland Cavaliers remain with just one representative, LeBron James (voted in by the fans).

Gasol is averaging 17 points, 10.9 rebounds, and a couple blocks a game, and is the only thing close to a consistent performer the Bulls have. Besides the injured Butler.

Bulls’ All-Star Jimmy Butler out 3-4 weeks with strained knee

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It was concerning when it happened — Jimmy Butler injured his knee and had to be taken off the court on a stretcher.

But then the reports came back saying the X-rays were negative, this was just a strain. Butler was going to miss some time, but the question was how much?

Turns out, 3-4 weeks — including the All-Star Game, the team announced Tuesday. From the official team press release:

Bulls guard/forward Jimmy Butler was re-examined by Bulls Head Team Physician Brian Cole.  Butler is expected to miss the next three to four weeks with a strained left knee. Butler has begun rehabbing his injury and he will be allowed to engage in all activities as tolerated with the primary goal of maintaining his conditioning over the ensuing weeks.

Butler is the Bulls best player, averaging 22.4 points a game and handling a lot of the shot creation for the team (along with Derrick Rose, who was out Monday injured). The Bulls offense is 1.6 points per 100 possessions better when Butler plays, plus he usually draws the other team’s best wing player as his defensive assignment.

Following an ugly loss to the Hornets Monday night, the Bulls are now 5-12 in their last 17 games. Since Joakim Noah went out for the season with an injured shoulder in particular, their defense has struggled. They still have no offensive identity.  Chicago has fallen to the seven seed in the West, just 1.5 games ahead of Charlotte and falling out of the playoffs completely. This injury is simply going to add to that slide.

The Bulls thought they were the team that could challenge Cleveland for supremacy in the East at the start of the season. Now they may need a late push just to make the playoffs.

NBA Commissioner Adam Silver will pick his All-Star Game replacement. In the past, he has picked the player highest in the fan voting not selected as a reserve, in this case that would be Kyrie Irving. But Silver can go any direction he chooses.

Report: George Karl to remain Kings coach following face-to-face meeting with GM

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George Karl isn’t going anywhere as coach of the Sacramento Kings after all.

At least for now.

Marc Stein of ESPN, who had the report that the Kings decided to fire Karl during the All-Star Break — now says the two sides have sat down and hashed things out. For now.

Those first reports went too far down the line, according to Adrian Wojnarowski of Yahoo Sports.

First things first, the Kings are a leaky organization right now. Which is never a good sign.

This has become a power struggle in the organization — DeMarcus Cousins has said the Kings’ problems go beyond the players, and he is known not to be a fan of Karl (Rajon Rondo is the coach’s biggest supporter because Karl gives him a green light). Owner Vivek Ranadive remains too impatient, stability is needed.

But there are still big picture questions to be answered.

Ranadive, with Vlade Divac, needs to sit down and set the long-term course for this team, including style of play they want to have, then decide if Karl can be part of that future. Also, if Cousins can be part of that future. If those two can be part of the future together (I’m not sure they can).

There needs to be more meetings with the Kings, and then this summer some significant decisions must be made. But doing it now at the All-Star break isn’t going to change anything. So Karl stays.

Adam Silver remains optimistic there will be no 2017 lockout

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By this coming December 15, both the NBA owners and the NBA players can opt-out of the current NBA Collective Bargaining Agreement. At least one side (likely the players) is expected to do so, setting up a potential lockout in the summer of 2017. The last one in 2011 lasted 161 days and forced the NBA to start its season on Christmas Day.

NBA Commissioner Adam Silver is optimistic it will not come to that.

The two sides are already talking about an extension of the deal, and Adam Silver talked about that on the USA Today A to Z Podcast with Sam Amick and Jeff Zillgitt, something they detailed in a story.

Encouraging signs exist – even if there is a lockout – that regular-season games won’t be lost, as was the case in 2011. The two sides are meeting regularly, building relationships and trust. The league is dealing with new leadership on the union’s side: Michele Roberts, the NBPA executive director, has been on the job about 17 months and NBPA general counsel Gary Kohlman was hired at the start of the 2014-15 season.

“My cause for optimism is based on to me the spirit of the discussions and the directness in which we’ve been dealing with each other,” Silver said.

The two sides have done a good job keeping the negotiations private and not negotiating through the media. So far. And the number of optimists that a CBA extension can be worked out is growing around the league daily. The new faces at the negotiating table help with that, some of the old animosities are gone.

But the main reason for optimism: There is too much money on the table now for both sides to screw it up. The new television deal brings $2.6 billion to the table annually in addition to gate and other revenues. It’s putting money in the pockets of owners plus dramatically driving up their franchise values. For players, it means larger paydays — in the new system the average NBA player salary will be around $8 million annually, and the average starter will make $12 million a season (ballpark numbers, of course). Players are not going to want to miss paychecks for esoteric, or even good, reasons.

Never underestimate the corrupting power of human greed. These talks can go sideways. But there is reason to be hopeful that no lockout is coming. And that starts with the fact both sides are already talking to each other (and not the media).