There are countless sports analysts and fans who speculate on how LeBron
James will be heading to a larger market like New York to make more money off his endorsements, to gain more exposure, and apparently to move away from his friends here to be closer to 1.47% Nets owner Jay Z. (Apparently the economics of flying to hang out with each other has gotten much too expensive for both, due to rising gas prices)
We all know one of his goals is to be the first billionaire athlete, and with his Nike escalators, these arguments do make sense. However, I have never read any articles that actually tried to break the situation down. Nobody has tried to use any real logic. Unfortunately, the only articles I find repeat exactly what ESPN reported after he signed his three year deal. That trickled down to the sports columnists, who in turn put their own little spin on it, but all wanting James in a new market.
Reportedly, the stipulation is always his decision will be made on whether or not Cleveland wins a championship by 2010. To do so Danny Ferry needs to sign a “Scottie Pippen”, if you will, for scoring help. Apparently, other than James, the Cavaliers are full of scrubs. Never mind these same scrubs carried him through seven games in the Eastern Conference Semi-Finals against the Celtics this year, but that’s an argument I won’t get into. All teams are always looking to improve.
Is LeBron better off in a larger market?
In my opinion, the answer is no. If he wants to go, he’s going to go. But unless the franchises clearing room for him have not put together at least a .500 team by then, he’ll be in the same if not worse situation he’s in now. I’m sure Nike would prefer that their investment play in a city like New York or L.A. (again the escalators), but 2010 holds the same anxiety for Nike as it does Cavaliers fans. His Nike contract is also up in 2010.
Some say the 2008 Olympics in Beijing will have a dramatic effect on the outcome of the situation. With the exposure associated with the Olympics, a great performance by James, and a Gold Medal, Nike will be forced to give him a more lucrative contract. In reality, Nike is going to have to give him larger contract regardless of what happens. They do not want to let their investment sign with another shoe company. Whatever amount of money LeBron wants from Nike, he will get. Regardless of what market he plays in.
It appears to me that LeBron James is quite the savvy business man. He’s put himself in a great position to control his own future. Not Nike, not the Cavaliers, but him. Also in 2010 he becomes a seven year pro. Any player with less than seven years experience can only command 25% of the salary cap. After seven years players are eligible to earn 30% and, under the current C.B.A. (at least how I understand it), the Cavaliers are the only team who can offer 30%, a term of six years, and with a 10.5% annual increase. Any other team can only offer five years, with an 8% increase. That’s 30 million more than any other team can possibly offer. There will be no Nike escalator to make up that difference in 2010.
Will Lebron James receive more exposure in a large market?
People tend to base a teams market solely on city population and economy. This could not be more inaccurate. Here are some interesting statistics I’ve found on Cleveland’s “market”.
1. The Cavaliers were third in the league in average home attendance, with 20,465 (a capacity of 20,562). They had 33 home sellouts. Only Chicago and Detroit averaged more, with capacities of 22,879 and 22,076 respectively.
2. They had 31 nationally televised games (Top Five). The Lakers had the most with 33.
3. Every Cavalier regular season game was televised regionally. A network that reaches cable companies in Toledo, Columbus, Youngstown, Lima, Pittsburgh PA, Buffalo NY, and areas in between. The channel is also offered nationally in a Direct T.V. package.
4. Cavaliers merchandise is in the top 10 in the league, per capita. (Up 500% from six years ago)
5. LeBron is top three behind Garnett and Bryant for licensed product sales, and he is fourth in jerseys sales.
Let’s also take a look at some of the things he has accomplished as far as his exposure is concerned.
1. Cover of Fortune Magazine
2. Cover of ESPN Magazine
3. Cover of Vogue Magazine
4. Hosted the ESPY awards
5. Hosted Saturday Night Live
6. Collaborated with NBA brass to play pre-season games in China.
All these things he’s done while playing for Cleveland. The King is well on his way to becoming a World Icon. Even if he was concerned about his media market, the Cavaliers are quickly becoming on of the top markets in the league. Regardless, he’s above the nuances of worrying about which market he plays for, unlike your average upper echelon NBA baller. He's already established himself as a mutli million dollar business, he has created his own market in his name. Similar to MJ.
In closing 2010 is still two seasons away. It’s far too early to actually predict what LBJ will do that year. If he leaves I think it will be because of management issues and not because of his endorsements, market, or who he’s friends with. I think Danny Ferry has done a great job cleaning up the mess he inherited. We now are much closer to a Championship caliber team. So Cavs fans, relax, I expect we will keep our super star for many seasons to come.