Like all the cool kids — well, all the cool kids in 2001, today it’s completely overblown — NBA Commissioner Adam Silver is in Austin, Texas, for South by Southwest, or SXSW.
And one of the many division of the event now is SXSW Sports, where Silver was a keynote speaker. While there he got asked by a Seattle fan about the possibility of expansion, about the only way that city will get a team in the short-term with new arenas coming in Sacramento and Milwaukee.
Silver shot it down in no uncertain terms, saying it isn’t good for the current owners (who would need to approve expansion). From Ananth Pandian of CBSSports.com.
“We are 30 partners right now. Thirty teams. Each of those teams own 1/30th of all the global opportunities of the NBA. So the issue becomes, if you expand, do you want to sell one of those interests off to a new group of partners? One reason to do it of course, is that if it’s additive. And no doubt, Seattle is a great market. At the moment, like for me as successful as the league is right now, we (are) not in the position, putting even aside profitability, where all 30 teams are must-see experiences. That’s not a secret….
“There are so many great players in the league,” Silver said. “And that’s one of the issues with expansion. Even putting aside the financial notion of selling equity and whether if it’s additive to the league as a whole to add more teams, the question becomes is it dilutive in terms of talent. And that’s something that I’m focused on as well.”
The bottom line is this: owners currently all get 1/30th of the slice of the financial pie from television, global markets, and the rest of the income beyond ticket sales. They don’t want to make that 1/31st. Mark Cuban has said this before, the short-term bump from expansion fees is not worth the long-term hit from giving up part of that income.
What’s more, this would let 15 more players into the NBA. You can make an argument that the next 15 are no better than the last 15 currently on NBA rosters, but does the league need to put more of those guys who are bouncing between the D-League and the NBA into the league? Does that improve the product?
Silver said eventually the NBA will consider expansion again, it’s the way of any business. But it’s not happening anytime soon.