I have Mike and Mike to thank for making my morning commute just a little brighter. A few days ago they had David Stern on, which wasn’t good for my happiness level. Here were some of David Stern’s points.
1. The Owners are being more cooperative than the players
This is such a ridiculous thing to say. We need to remember that this is a lockout! That means the owners started it! Why should the players be as cooperative as the owners here? By being cooperative the owners get more money. By being more cooperative the players lose money.
2. The world has changed and the owners are losing money
David Stern pointed out 57% is no longer feasible. Now let’s point out that number is tied to revenue! That means the players salaries stay flat relative to how the league is doing. The NBA may be losing money but it isn’t due to the player salaries, it’s due to external costs. Stern brought up two, which I’ll go into more detail below.
3. Charter jets are expensive
This is an ever popular topic. Oil prices have gone up and planes use oil so this is an unforseen cost that can explain the issue teams are having with money! I decided to look up the cost for a charter jet (I used a 737-200 and 727-200 as my plane type) the prices I’ve seen are around $7,000 hourly. I decided to go ahead and up the cost to $10,000 hourly to adjust for any fuel arguments. A round trip flight to Boston to Los Angeles is around 11 hours (courtesy of Google Flights) Using these two numbers we can get a fun upper bound estimate. If every team paid $10,000 an hour per flight and every flight was a Boston-Los Angeles length flight then the total flight budget for the regular season(41 flights for 30 teams) would be $135 million. The league is claiming losses of over $300 million. In the worst case flights only explain $135 million in total cost! That means the actual hit would have to be somewhere between what the NBA actually expected the flights to cost and the increase in value. In short even if we buy that the NBA was shocked by changing fuel prices and that they paid top dollar for the flights and every flight was as long as can be they still come up over $200 million short. That means every other excuse the NBA is using would have to cover the rest of those costs. That brings me to another point.
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4. The NBA needed more employees to handle ticket sales.
David Stern said that demand for the game had dropped. Of course this isn’t true. The way he sold it was that because people were buying tickets in smaller bundles (e.g. sets of 10 instead of sets of 40) that more employees were needed to handle sales. His two main cost points were charter jets (see above) and this! First off are we expected to believe that low wage workers to sell tickets could even make a decent dent in $300 million? Second, do we really believe the NBA is losing costs to employees? Employees were one of the first casualties of the lockout. The NBA has shown no problem cutting employees to cut costs. If they were losing money since the last CBA does Stern really expect us to believe they’d be content losing costs to employees?
David Stern isn’t addressing anything
I didn’t hear David Stern explain how the NBA was going to try and curb the uncontrolled costs. I didn’t hear David Stern explain how the NBA would try to increase revenue. I heard David Stern say the players need to fork over money to help the owners. The issues put forward by the owners seem flimsy. Also if the issues are enough to put the NBA in danger, why aren’t the owners trying to do anything to deal with them in this CBA? David Stern and the owners have done nothing to address the issues and have essentially asked the players for a check. The negotiations have nothing to do with the issue in fact! They have everything to do with the size of the check.
As an NBA fan I want this lockout to end. That said, when I hear David Stern talk, I can’t help but feel more upset at the fact that I am being lied to and the wrong people are being blamed. Instead of locking out the players perhaps the owners should have locked themselves out and hired a new commissioner.