Revenue Sharing

[mcHAPPY]

Well, I'm not surprised about San Antonio. They had one of the highest cap numbers in the league last season. Dallas and Miami are surprising though.

Forbes data would be for the 2009-2010 season.

[mcHAPPY]

I agree. I read somewhere (cant post source) that the Raptors is one of the profitable teams in the NBA. What i cant put my finger on is, HOW??? We've only been to the playoffs twice in 7 years and still the attendance is constant? Me, im an avid follower but i dont have money for tickets.

What i do know is that a lot, if not most of the tickets are bought by corporations as gifts for their employees or for entertaining clients. my mom works for a big sponsor and they get tickets by the hundreds. same with my aunt who works for a different sponsor.

I guess it doesnt matter where the money comes from, as long as there's money coming in.

It doesn't hurt that Leafs fans are insane and have to buy Raptors season tickets to get their Leaf season tickets as well.

[albertan_10]

I think the players are concerned about revenue sharing because it will help teams get out of the red. If teams can get out of the red then the players don't have to give back as much money.

That being said, I think if you have to have one team giving another one $$$ every year, then the system is broken and it needs to be fixed, which puts us right back at the lockout.

[mcHAPPY]

What about some specific ideas of what would be fair for revenue sharing, such as:

Tax all profitable teams a percentage of profits and divide proportionately among the losers?

Take 50% of all TV contracts and ticket revenue for all teams and divide equally among all 30 teams? (Since every team is a visitor for 41 games a season, that might work while still allowing teams with lucrative contracts and strong attendance to have a financial advantage).

[Tim W.]

It depends on where you want to class them. Are they making money? I would bet yes. Are their profits in line with the big markets? I'd guess not even close. They're probably not in the red but as is they can't sling it out with the big boys until there is a harder barrier for teams wishing to take advantage of spending more than others and there is revenue sharing so that the teams spending the big coin have less to spend and the teams who don't have the big coin to spend have more of it to spread around. I do think the Raptors would benefit from revenue sharing of some sort even if it is not directly.

Not sure why you don't think the Raptors wouldn't be one of the more profitable teams. What is it about them that would preclude them from making money? They have larger television market than any other team (Canada, as opposed to just the city), and while LA, New York or CHicago would obviously be a more profitable television market, Toronto wouldn't be far behind. Their attendance is usually in the top half in the league despite being one of the worse teams over the last 15 years. They are based in a market with a lot of corporate headquarters.

And the dollar is barely a factor, anymore, so that shouldn't really matter.

[octothorp]

I'm really leery of excessive revenue sharing, simply because it reduces the dependency a team has on their own fans for revenue. I would hate to see, for example, a revenue sharing arrangement like MLB, where it essentially encourages small-market owners not to spend, so they can keep cashing in revenue-sharing cheques. I do like the approach that the NHL has, where revenue-sharing is linked to a number of key-performance indicators, such as attendance: if you alienate your fans, you lose out on RS income (although there are too many loopholes with the NHL system, as teams have gotten around this by giving tickets away to artificially inflate attendance and meet the RS threshold).

[Bendit]

I'm really leery of excessive revenue sharing, simply because it reduces the dependency a team has on their own fans for revenue. I would hate to see, for example, a revenue sharing arrangement like MLB, where it essentially encourages small-market owners not to spend, so they can keep cashing in revenue-sharing cheques. I do like the approach that the NHL has, where revenue-sharing is linked to a number of key-performance indicators, such as attendance: if you alienate your fans, you lose out on RS income (although there are too many loopholes with the NHL system, as teams have gotten around this by giving tickets away to artificially inflate attendance and meet the RS threshold).

There is also a cap floorin the NHL which forces teams to spend on salaries. I am not entirely sure whether forcing an overpayment or taking on bad contracts is ever a good thing though.

[mcHAPPY]

There is also a cap floorin the NHL which forces teams to spend on salaries. I am not entirely sure whether forcing an overpayment or taking on bad contracts is ever a good thing though.

You could overpay a one year contract to a) meet the floor and b) entice a player to pass on a long term deal for a large one year contract that is larger than any annual salary they would get in a longer term deal.

I agree it would not be a great thing to do but for a team in the processing of tearing things down and rebuilding, it would be an idea.

[Apollo]

The floor no doubt provides a challenge to teams doing a rebuild but there is no guarantee it will be part of the NBA CBA. The NFL has done something similar to what the NHL has done but the NFL's is a plan set in stone and decreases through the life of the new agreement. The NFL's floor is at it's peak right now in year one.

[Bendit]

I agree it would not be a great thing to do but for a team in the processing of tearing things down and rebuilding, it would be an idea.

Oh I dont know. If a team is intending to reorganize/tear itself up then having a bad record is necessary in order to get a good draft position. Getting forced to employ players to pad the payroll may also unfortunately have the effect of generating wins which was unintended....unless you chain them to the bench.

[mcHAPPY]

Oh I dont know. If a team is intending to reorganize/tear itself up then having a bad record is necessary in order to get a good draft position. Getting forced to employ players to pad the payroll may also unfortunately have the effect of generating wins which was unintended....unless you chain them to the bench.

That is where you get Patrick O'Bryant a one year $5M contract :P

[ezz_bee]

If the small market teams and teams w/ loses are the ones driving the negotiations as some articles posted here allude to, then there may be significant changes to revenue sharing.

Personally, I wouldn't make too many changes. You do have to be careful not to incentivize poor management. I would only do two things other than whatever they agree to in regards to luxury tax.

Share gate revenues: I wouldn't share gate at 50/50 but 55/45 or 60/40 home teams still get more but there's more parity.
Share TV revenues: I would share these at a less equal rate, say 65/35 or even higher, maybe even 80/20. This is the first agreement that might add something like this so I wouldn't go overboard.

To me it seems that the goal is to have fewer teams operating at a loss, not to have all franchises making the same amount of money. So I would make small changes.