NBA loses hundreds of millions of dollars in China, may return to play preseason games in 2020

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CHICAGO — The NBA’s damaged relationship with China hit the league’s bottom line hard, and the relationship is not yet back to normal, but NBA Commissioner Adam Silver is convinced it will get there. Eventually.

The fallout from a Tweet from Rockets’ GM Daryl Morey supporting the protestors in Hong Kong — and the league’s refusal to publicly punish him or remove him from office — has hit the league’s pocketbook hard, NBA Commissioner Adam Silver admitted Saturday night.

“I think that the magnitude of the loss will be in the hundreds of millions of dollars,” Silver said in his annual All-Star Weekend press conference. “Certainly, probably less than $400 million, maybe even less than that.

“It’s substantial. I don’t want to run from that. We were taken off the air in China for a period of time, and it caused our many business partners in China to feel it was, therefore, inappropriate to have ongoing relationships with us. But I don’t have any sense that there’s any permanent damage to our business there, and as I’ve said before, we accept the consequences of our system and our values.”

That financial hit has impacted the league’s bottom line, and the salary cap.

After a slow and rocky start, the NBA eventually backed Morey’s right to express his opinion on the political matter of the protests in Hong Kong. However, that is a third-rail issue for the Chinese government, and the fact Morey apologized and soon removed the Tweet was not enough — the Chinese government pushed for him to be fired. The Rockets and the league made no such move, Morey remains the Rockets GM.

As a result, NBA games are still not broadcast on state-run television in China, although they are available for streaming (and the viewership is similar to past years), Silver said.

Silver struck an optimistic tone that the NBA’s relationship would return to normal, eventually. That includes the possibility that the league will play preseason games there next fall, something it has done most years for a long time.

“There were two sets of games that may be potentially played in China,” Silver said. “There have been discussions about pre-Olympic games. So this would be USA basketball playing in China. So there are ongoing discussions there, and there also are ongoing discussions about whether we will return for preseason games next year.”

Silver said that the outbreak of the Coronavirus has put all those talks on hold as China focuses on that health crisis.

“It’s almost hard for us to be having conversations about the broadcasting of games when there’s a major national, if not global, health crisis happening,” Silver said. “So the answer is I just don’t know sort of next steps in terms of the process. We’ve had lines of communication open for a long time with counterparts in China, and as I said, I think there’s a mutual interest in returning to normalcy in terms of the distribution of our games.”

Silver added that the league has helped, donating to relief efforts tied to the virus, as it does in the wake of disasters around the world.

For now, all the league can do is be patient and wait.

Nuggets GM Arturas Karnisovas reported early leader for Bulls’ top job

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What do the Bulls want in a new top executive? Near the top of the list: someone who can build an organization that drafts well and develops that talent. That’s why executives from Miami, Utah, and Toronto were high on the wish list.

Enter Nuggets general manager Arturas Karnisovas, who has done exactly those things in Denver. Karnisovas is the early frontrunner, reports Vincent Goodwill of Yahoo Sports.

Multiple sources told Yahoo Sports that Denver Nuggets general manager Arturas Karnisovas is the leader in the clubhouse…

Sources said [team president Michael Reinsdorf] wants someone who has a presence publicly, especially given the reticent nature of Paxson and Forman the last several years. The Bulls have embraced analytics the last few seasons but having someone who can discern how to apply the numbers against other basketball factors is important to Reinsdorf…

“He wants someone who’ll surround himself with smart people, a great talent evaluator. There’s a need to get better in the player development department, too,” a source told Yahoo Sports.

Karnisovas has worked mostly in the background in Denver, with Tim Connelly being the face of the basketball operations. That would be a big change for Karnisovas, but one he may be ready for.

John Paxson is helping Reinsdorf with the search, but Paxson reportedly will take on whatever role is asked — or step aside completely — to make things smooth for whoever takes over the organization.

While NBA taking big financial hit, rumor is salary cap will not see huge drop

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No NBA games are being played, no fans paying for tickets or buying arena beers, no revenue is coming in. The NBA playoffs will not start on time. If games are ramped up at any point in the next couple of months, it will not be in front of fans, just television only.

Which is to say, the NBA is taking a big financial hit right now. How much is impossible to say, but a billion is not out of the question.

The NBA is set up for the players and owners to split revenue, basically 50-50 (it’s more complicated than that, but it stays close to that range). If Basketball Related Income (BRI) drops around the league, then the salary cap drops and players get less money.

The league’s income is going to suffer, but the salary cap may not that much the NBA players union told agents in a call today, according to Ian Begley of SNY.TV.

What this implies is salary cap smoothing — the league would keep the cap artificially high in the short term, but when revenue spikes back up in the following years that rise will be artificially slowed a little to even things out. The idea is to smooth out the cap number rather than have wild fluctuations.

This is likely part of the negotiations going on between the league and players union over the force majeure clause of the CBA, which allows owners to reduce salaries if games are canceled. If the players give up salary now they don’t want to see future income fall too because the cap cratered for a season or two.

Most likely, the owners and players can work out a cap-smoothing compromise that works for both sides (something they could not do when the new NBA TV deal kicked in and the cap spiked back in 2016). The league’s cap projections were already reduced some by the loss of revenue from China following the Daryl Morey Tweet controversy, the missed games obviously will reduce it further.

How much further appears to be under negotiation.

Bulls’ John Paxson reportedly willing to play small role, or even step aside, for new front office

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It all seems a little too coincidental.

Early reports about a shakeup in the Bulls’ front office had John Paxson, the current vice president of basketball operations, retaining at least some power. There also was a push to help current coach Jim Boylen keep his job.

Then the Raptors’ Bobby Webster, Pacers’ Chad Buchanan, and Heat’s Adam Simon all dropped out of the running for the Bulls job.

Suddenly, there has been a series of reports that Paxson was willing to give up his power and is ready to play whatever role the new GM wants. There was this from K.C. Johnson of NBC Sports Chicago.

But the perception that Paxson will be some hovering presence, going kicking and screaming into the night, is simply wrong. Early this season, Paxson communicated his vision to ownership for a new-look, more modern front office. He initiated some of this need for change.

Michael Reinsdorf likely would have arrived at the same conclusion anyway and has taken the reins on addressing the issue. Well before news broke over All-Star weekend, he began performing due diligence and background on a wide variety of candidates.

Joe Cowley at the Chicago Sun-Times took it a step further.

A source told the Sun-Times on Tuesday that not only is Paxson all for stepping aside from his position and acting more as an adviser to the Reinsdorf family when the front-office restructure is finalized, but would completely step down from the organization if the Reinsdorfs and the new-look executive group deemed it better for the rebuild to continue.

Was the “perception that Paxson will be some hovering presence” just among fans, or did it exist among potential candidates, too? Each of the three candidates that dropped out have positons of some power in quality organizations, each is only going to leave for just the right offer, one with total control of the organization.

It all seems a little too coincidental that they all dropped out and then came the rash of reports about Paxson not wanting to retain power. Whether it was true or not Paxson was always willing to step aside, perception matters.

Chicago did interview Utah’s Justin Zanik, another experienced executive from a stable organization who could be a good fit with the Bulls. The Jazz have set up the kind of strong draft-and-development program (Rudy Gobert, Donovan Mitchell, etc.) that the Bulls should try to emulate. The Bulls are also expected to interview Nuggets’ general manager Arturas Karnisovas and Magic assistant general manager Matt Lloyd.

With no games going on, there is no rush to make a hire by the Bulls, they have plenty of time for due diligence (as do the candidates). Chicago will want its new head man and his front office staff in place before what is likely a compacted draft and free-agency period, whenever that comes.

Potential lottery pick Arizona point guard Nico Mannion declares for draft

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His coach had said this was coming, and while it took a while to become official, it did on Tuesday.

Arizona point guard Nico Mannion is entering the NBA Draft.

In what is a down draft, Mannion looks like a late lottery or mid-teens pick. However, on an NBA court he projects more as a backup point guard.

Mannion is 6’3″ with a good feel for the game who averaged 14 points and 5.3 assists a night for the Wildcats this season. He reads the game well and seems to understand when he needs to score and when he needs to facilitate. The challenge is he’s neither athletic or long by NBA standards, and his shot needs to get a lot better — 39.2 percent shooting overall and 32.7 percent from three last season. He’s had some challenges finishing at the rim against college-level defenders. His ability to improve his shooting will go a long way in determining his NBA future (that and how much he can improve on defense).

Still a smart move for a lock first-round pick to come out and start getting paid.

The NBA Draft is scheduled for June 25 but nobody knows when it will actually happen and in what form. There are restrictions on how teams can evaluate and talk to prospects. The league will decide when the draft will take place after it figures out what to do with the rest of the season and the playoffs, a decision that will not come until May at the earliest.