The National Basketball Association (NBA) is facing the possibility that there may not be a basketball season for 2011 as the current lockout is still in place. The lockout began on July 1, 2011 after failing to come to a resolution on the collective bargaining agreement (ESPN, 2011). Team owners are now prohibiting players from accessing the team facilities and trainers (ESPN, 2011). The issues presented for discussion are: (1) Splitting the revenue amongst teams; (2) Obtaining a Competitive Balance; (3) Setting a hard cap versus a soft cap; (4) Increasing revenue sharing for team owners; and (5) New contract terms(ESPN, 2011). The views of the NBA players in comparison to the team owners and the NBA officials are on different ends of the spectrum, and may cause millions of basketball fans disappointment if the NBA season fails to resume this year. The NBA has recently filed an antitrust lawsuit against the players for unfair bargaining (ESPN, 2011). This entire dispute could be resolved if the unions were dissolved, and owners were left in total control of their teams.
Splitting the Revenue Amongst teams
It has been suggested that teams should share the revenue when they play against each other. So there will be a certain percentage of the revenue retained by the home team and a percentage shared with the visiting team. Although on the surface it appears to be a fair proposal, there are other variables not accounted for. Should the NBA allow the least dominant teams (less successful) to benefit from the hard work placed into advertising, promotions, and the commitment to building a successful organization by the most dominant teams? For example, should the Los Angeles Lakers be forced to share its revenue with the Sacramento Kings when the Kings come to play in a sold out Staples Center? And should the Lakers share in the revenue when they play in the Pavilion (formerly known as Arco Arena)? Clearly one team would benefit more than the other from this arrangement. While the Kings would clearly benefit from sharing revenue with the Lakers, the Lakers would not stand to gain the same from sharing its revenue with the Kings. In this example, the Lakers would likely incur a larger profit by keeping the revenue made at home, rather than sharing with the Kings, while the Kings may very well profit more by receiving a share of the revenue that the Lakers made on their home court. This would be unfair to the more successful NBA teams.
Obtaining a Competitive Balance
It has been suggested that in order to obtain a competitive advantage, it is necessary to enter into a new collective bargaining agreement that would reduce the maximum salary paid to NBA players to an amount that would allow the less successful teams to have the ability to compete for superstar athletes. No matter what figure is agreed upon, it will always be to the benefit of some and to the disadvantage of others. A competitive balance can be reached without manipulation of player salaries. The most successful teams are able to attract superstar athletes not simply because they can offer a higher salary, but because they can offer a championship team. The least successful teams may argue that they are not able to compete for superstar athletes because they cannot pay their salary while trying to also surround that player with teammates who are of championship caliber. Although this would be a plausible argument, if the salary cap was lowered so that the least successful teams may compete for superstar athletes, does that not strengthen the bargaining power of the most successful teams? This would allow the most successful teams to have more money to attract an entire team of superstars. And the growing trend is that superstars are willing to incur pay cuts to play with other superstars because the chances of winning a championship is greater. The Dallas Mavericks is a perfect example of this. A salary cap will only increase the ability of the most successful teams to attract an entire squad of superstars. This would lead the NBA to setting a cap on the amount of superstars one team may have, resulting in extremely unhappy team owners, unhappy NBA players, and unhappy fans.
Hard Cap Versus Soft Cap
The owners of NBA teams proposed that the total salary paid should not exceed a certain amount to be agreed upon, and any team who exceeds the cap should pay a penalty for doing so. The players union however would prefer a soft salary cap similar to the salary cap currently in place. The disagreement over hard salary cap versus soft is of the least importance in my opinion. Either way, the fact that the salary cap will likely remain in the millions suggests that team owners, players, and the NBA should all be thankful that it can continue to pay lavish salaries while the rest of the United States are content with making less than six figures annually with hardly any time off from work. The decision on what players should be paid should be left to the owners, the players, and the players attorneys to decide. If some players can't accept it, there are lots of lower paid athletes who will.
Increasing Revenue Sharing for Team Owners
New Contract Terms
There is a debate over the length of new contracts and the age in which individuals should be allowed to enter the NBA. Once again, this is the least of their worries. If an 18 year old has proven his ability to play at a professional level, no one has the right to tell him that he cannot enter the draft. This may work for the NFL but it is a matter of time before this is debated there as well. Also, the length of a player's contract should be left up to the owners and the player's representative. After all is this not the reason why players hire agents and attorneys? If the union could accomplish this better than they could, why are players even paying attorneys?
In the end a lot of the issues being debated amongst the players, team owners, and the NBA are being discussed in the wrong forum. The NBA allowed the union to create too much player influence, and not enough sound business influences. The NBA in its entirety is after all a business. If there were no NBA, where would the players be right now? Where would the owners be right now? Where would the union be right now? So the overall goal should be saving the NBA, giving the fans what they pay for, and preserving the competitive advantage of the NBA amongst other basketball leagues abroad. There are already players entering into contracts with foreign teams, and if this lockout continues, larger numbers are sure to follow. So team owners should be allowed to control their own teams, and players should understand that there are others in the United States who have suffered pay cuts, but found a way to persevere, and surely they can do the same.
Reference:
ESPN (2011). Retrieved on August 8, 2011 from: http://espn.go.com/nba/topics/_/page/nba-labor-negotiations.
-Kerriann E. Sheppard
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