The looming sportspocalypse
I’d wager it’s almost certain we’ll see a work stoppage in either the NBA or NFL for the 2011 season, and there’s a decent chance both leagues will shut down. Consider first Peter King on the NFL’s looming labor troubles:
As of this morning, we’re 580 days away from Opening Day 2011 — the first day there will be no football if the owners lock out the players. There are going to be 580 twists and turns of the story between now and then. Still, I believe there will be a work stoppage in 2011. The fact is, owners want players to bear some burden for the costs of all the stadiums that have been built in recent years, and players don’t want to pay for something they’ve never paid for before. That’s the elephant in the negotiating room right now, and no one’s budging.
The NFL’s in a spot — league revenues are declining, though not precipitously — but one that’s manageable due to the absurd largess of their television contracts. My understanding is that every NFL team can essentially cover its payroll obligations just from the TV deals. How big are those TV deals? Well, ESPN pays $1.1 billion per year for the broadcast rights to Monday Night Football. That’s for 16 games a season. NBC, meanwhile, is paying $600 million per year for Sunday Night Football, a steal in comparison. Plus there’re the regular season games, the playoffs, DirecTV’s deal, and the Super Bowl, all of which command billions of dollars a year. The owners would be nuts not to come to some sort of deal with the players.
But in the NBA, things are different. Estimates vary, but many — maybe most — NBA franchises are losing money. The NBA commish David Stern places the figure at $400M this year plus $200M in each of the past four seasons, with another source saying that 25 to 27 of the league’s 30 teams will lose money this year. The reasons for this vary — Bill Simmons, ESPN’s Sports Guy, gets into them here — but a key reason is the spiraling cost of player salaries. Mid level guys are getting $10M a season. This, in a word, is nuts.
As a result, the NBA players union has to realize that they’re going to make concessions: A hard salary cap, reductions in the maximum length and pay of contracts, and a smaller portion of the league’s revenue at the very least. It simply has to happen, because if it doesn’t, the league will lock the players out and starve them: Better to lose a little money by not playing games than a lot of money by playing them. As the Sports Guy has said on a number of occasions, the average NBA player lives paycheck to paycheck: It’s why they crumbled so quickly back in ’98-99. You’d think the players would have learned their lesson — and maybe they have — but we’ll see.
It will be interesting to see just what transpires over the next 18 months or so. But don’t say I didn’t warn you: The fall and winter of 2011 could be a barren time for sports fans.