Will the Economy Crush the NBA?

I hate to keep harping on the economy but it scares me and it should scare the NBA.

I am probably more bearish than most and believe we are heading into unprecedented times. I believe we will be facing a long-term recession and perhaps even a depression. The NBA, also, has a gloomy forecast with the league office recently cutting 9% of its workforce or apporximately 80 jobs. However, I do not think it is enough, the NBA needs to do more.

Last week, I was watching the Dallas Mavericks vs. the Detroit Pistons preseason game and an advertisement for the Mavericks came across the screen that read: “Opening night game tickets start at $2.”Granted, the Mavericks are probably only selling a few hundred or so of these tickets at this price and the rest come with a higher price tag, but 2 friggin dollars on opening night?? 

The advertisement got me thinking and is a direct sign of the calamity the NBA faces. We are not talking about an unpopular team here in the Maverics. Dallas ranked #4 in the league last year with home attendance, but they have not sold out their home opener and are selling tickets at these prices!?! What is going to happen to the teams that fared much worse with their attendance last year such as the Pacers, Grizzlies or Kings? If you are a Pacer fan and have season tickets to the Colts and Pacers, which one would you drop? During these times, would you spend hundreds of dollars to take your family to the game or watch it on your couch in front of an HDTV?

It doesn’t just stop with the average fan but think about all of the companies that will pull out of purchasing a suite for the year. The NBA teams have long argued that suites are what keep them profitable, as we see everytime they want a new stadium. If a company is struggling, firing employees and about to go under, do they keep their suite? I think not.

Revenues are going to drop significantly with the drop in ticket sales, merchandise sales and advertising. The NBA needs to make “stern” moves now or will be facing unparalleled measures. Players are overcompensated, the union has too much control and the entertainment of the games have diminished.  How can NBA owners support their teams if they are losing money?

If I were the commissioner of the NBA, I would renegotiate with the union and bring salaries down. How any NBA player can expect to make $20 million a year while their fan base is without a job and losing their house is beyond me? Expenses must come down or we will see teams go under. Contraction perhaps?

Also, players are not as skilled as they once were and most teams do not play a brand of basketball that is of the highest entertainment. As George said in his training camp article, teams need to practice more and the union has restricted practice time significantly in training camp. Limiting practice time hurts the coaches and the end product of the game on the floor. All of which devalues the entertainment of hte game and makes fans more likely not to attend a game.

I know these are measures that any commissioner would gladly want to take, but their hands are tied by the bureaucracy of the union and other factors. However, if the economy does what I believe it will, the NBA will be confronted with dire consequences.