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David Stern on Lebron and lockout. Owners want a 30% rollback on current players contracts

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  • #1

    David Stern on Lebron and lockout. Owners want a 30% rollback on current players contracts

    Owners looking for 30% first year salary rollbacks, one owner suggesting 100% chance of a lockout


    Interesting read. I am not familar with what the NHL did. But does this mean that every NBA player would have their salary rollbacked for 1 year 30%.

    http://nba.fanhouse.com/2010/07/13/d...-lockout-loom/

    David Stern Sounds Off on LeBron Quarrel; Potential Lockout Looms

    LAS VEGAS -- These should be the new halcyon days of the NBA.

    A seven-game dream Finals between the Lakers and the Celtics wrapped up in June, followed by a star-studded free-agency class that entered with unprecedented hype. Even the latest Las Vegas summer league has showcased the league's ever-growing brand, with next-generation talent like top pick John Wall filling the gym at UNLV and playing in front of a nationally-televised audience.

    But these are not good times for David Stern's league, with the ominous issues piling up and the commissioner having no choice but to address the obvious on Monday.

    After spending more than three hours meeting with the league's owners inside the Palms Casino Resort, a candid and cutting Stern came equipped with a lengthy hit list and fired away from the start.

    • He ripped LeBron James' one-hour ESPN show on Thursday that was dubbed "The Decision," calling the process of his announcing he would join Miami "ill-conceived, badly produced and poorly executed." Had Stern been consulted, he said he would have suggested James inform Cleveland that he was not returning long before "The Decision" so as to avoid the public humiliation. Overall, his was a just and respectable public lashing, lacking only a direct reference to James' handlers and, specifically, ring leader Maverick Carter.

    • He fined Cleveland owner Dan Gilbert $100,000 for his vitriolic letter to James after his departure, calling it "ill-advised and imprudent."

    • He criticized Jesse Jackson, albeit politely, responding to the reverend's comparison of Gilbert to a slave owner by saying, "(Jackson) is, as he rarely is, mistaken."

    • He was dismissive of reports alleging tampering in the case of James, Dwyane Wade and Chris Bosh "bringing their talents" to South Beach, saying the three players were "totally within their rights to talk to each other" about possibly playing together before free agency began. Stern added that the Labor Relations Committee has been asked to explore whether changes to the free-agency process should be part of future labor negotiations. In truth, however, the league is unsure how to police player tampering and has bigger items on its agenda at the moment.

    Such as, one could say, the future and viability of the league itself.

    Lost in the plethora of story lines rolling off Stern's tongue was the notable absence of any progress relating to labor negotiations. While there was rightful focus on the continued tarnishing of James' brand and reputation, Stern also revealed that most of the owners' meeting was spent discussing the oceans that must be crossed between now and next summer to avoid a lockout.

    Except for one thing: it seems Stern is the among the select few who believes it won't happen.

    An unofficial FanHouse poll of owners, coaches and involved agents returned an overwhelming sentiment that a lockout is inevitable, with one owner deeming it a "100 percent" certainty. The owners want to go the way of the NHL and its hard salary cap, although their plans are believed to include first-year salary rollbacks of approximately 30 percent that are even more extreme than the 24 percent implemented by the hockey league in 2005. As for the players, it sounds as if they may as well have told Stern to photocopy the current version of the CBA and throw a new signature on the bottom.

    "We reviewed their (latest) proposal with the owners," Stern said. "Basically where we are is that we're asking for fundamental changes in the system and the players, as (union director) Billy Hunter has said publicly, would very much like the present system to continue."

    There is more recent salt in this wound, too, as the funny money being doled out to free agents this summer has somehow managed to unify both camps even further. One source described the owners' current mood as "militant," while the players have grown even less willing to hear proclamations of relative poverty (Stern now says the projected losses are $370 million for last season) when players like Darko Milicic are signed to $20 million deals.

    Deputy Commissioner Adam Silver summarized the league's view on that front, saying, "teams have no business choice but to compete for players." The owners' stance is truly that simple, and the irony as they see it is that the recent flurry of bloated deals are -- in their view -- an indictment of the system even if they are signing the checks. And then there's Hunter, who at 67 may be hoping this is his last CBA negotiation and has thus far employed the "Last Stand" mentality in representing the players with the same unrelenting stance.

    It's not looking good at the moment, NBA fans. But heck, at least Game 7 was fun.

    E-mail Sam at amick.sam@gmail.com or follow him on Twitter @samickFanHouse.
    Read More: Cavaliers Heat NBA Free Agents Adam+Silver, Chris+Bosh, Dan+Gilbert, David+Stern
    Last edited by Unclebuck; 07-13-2010, 10:33 AM.
    Tags: None
  • #2
    Re: David Stern on Lebron and lockout. Owners want a 30% rollback on first year sa

    In the end the owners will get their way. The players have had it their way for far to long and the league is showing obvious signs of strain. The players can not be that stupid to think that it can go on like status quo when they look in the stands every game and see less and less people.
    You can't get champagne from a garden hose.

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    • #3
      Re: David Stern on Lebron and lockout. Owners want a 30% rollback on first year sa

      A slightly different take from Chris Mannix of SI

      http://sportsillustrated.cnn.com/201...nnbin&hpt=Sbin

      LAS VEGAS -- He didn't raise his voice or slam his fist. He didn't resort to theatrics during a 30-minute press briefing on Monday, NBA commissioner David Stern didn't once look annoyed. But his message to the players union on Monday couldn't have been clearer: get ready to makes some concessions, because what's going on now simply isn't going to go on much longer.

      In between tagging Cavaliers owner Dan Gilbert and slapping around Maverick Carter (more on that below), Stern addressed the looming labor issues that threaten to wipe out parts or all of the 2011-12 season. And to say there are issues would be putting it lightly; the two sides have already swapped proposals and, in the words of one NBA source, "are miles apart."

      "Basically where we are at is that we would like fundamental changes," said Stern, "and the players would very much like the present system to continue."

      That can't happen, Stern said. Not with his teams losing $370 million last season and a national economy in the toilet. No, fixing the NBA's problems will require a massive overhaul. The owners proposal calls for first-round picks to have their salaries cut by about one-third, would reduce the minimum salary by as much as 20 percent, and would guarantee contracts for only half their value. The total value of a maximum salary would drop significantly, as would the number of years players could sign for. The players would also see a reduction in their share of the basketball-related income, of which they currently receive 57 percent.

      "Part of the problem with the existing system is it's based largely on revenue, not net revenue," said deputy commissioner Adam Silver. "Although our actual revenue numbers were better than what we projected, it came at a large cost. Our teams did a spectacular job in a down economy of increasing ticket sales, but that came at the cost of additional promotions, additional marketing, additional staff. They largely made up for a reduction in season ticket sales by selling more individual tickets."

      The players union, predictably, wants no part of the owner's proposal. They rejected it over the All-Star break, with union chief Billy Hunter calling Stern's projected losses 'baloney.'

      "I think, as I understand their answer," said Stern, "is that, 'We agree with your numbers, we just would eliminate some of them from the final calculation.'"

      The Washington Post reported that part of the union's defense was that the total amount paid to players has risen only about 10 percent over the last four years, or about 2.5 percent a year, from about $1.85 billion to $2.04 billion. They will point to a salary cap that came in $2 million higher than expected and $8 million higher than the doomsday scenario the NBA floated last summer. And they will point to the tens of millions NBA owners have been doling out the likes of Amir Johnson, Drew Gooden and Hakim Warrick.

      Stern will listen and smile, but he will not bend nor will he break. An NBA filled with teams swimming in red ink isn't one he wants to oversee and he will do everything in his power to change that.

      "Our owners spend within the system," Stern said. "They're encouraged, praised, and otherwise driven to improve their teams. Of course, they have the capacity. It winds up driving them to unprofitability. They want to change that system so when they get driven to it, whatever they do, there won't be losses. That's all."

      But that's not all. The union, which has been battered and beaten by Stern at nearly every opportunity over the years, is digging in its heels. It's why many around the league are bracing for a lockout.

      "I'm expecting one," said a Western Conference executive.

      "It's going to happen," texted an Eastern Conference exec.

      Armageddon is coming to the NBA. At this point, it doesn't appear to be a question of 'if.' It's of how long it will last.

      • Stern announced that the NBA had fined Cavaliers owner Dan Gilbert $100,000 for his media tirade following LeBron James' decision to leave Cleveland.

      "I think that remarks by Dan Gilbert, catalyzed as they may have been by hurt with respect to the manner and the fact for himself, his team, and particularly for the people of Cleveland, though understandable, were ill advised and imprudent," said Stern.

      Stern also criticized Rev. Jesse Jackson, who issued a statement denouncing Gilbert, saying the Cavaliers owner treated James like a "runaway slave."

      "Equally imprudent, I believe, are the remarks by my good friend Jesse Jackson, which purport to make this into a racial matter," said Stern. "I find that to be, however well meaning Jesse may be in the premises on this one, he is, as he rarely is, mistaken. I would have told him so had he called me before he issued his statement."

      • Count Stern among the many who didn't approve of the way James left Cleveland. In his opening remarks Stern blasted James' nationally televised announcement -- which was the brainchild of James's business manager, Maverick Carter -- as being in poor taste.

      "I think that the advice that he received on this was poor," said Stern. "His performance was fine. His honesty and his integrity shine through. But this decision was ill conceived, badly produced and poorly executed."

      Stern added that he was disappointed that James didn't give Cleveland the courtesy of a personal phone call before he made his announcement.

      "Had he asked my advice in advance, I might have suggested that he advise Cleveland at an earlier time than apparently he did that he was leaving," said Stern. "Even without announcing where he was going, so we could have eliminated that. I would have advised him not to embark on what has been come known as "The Decision."

      • The signing of James, Dwyane Wade and Chris Bosh in Miami has made the question of collusion amongst players a hot issue in the NBA. However Stern said that no action will be taken against players, who are free to discuss their futures in any setting.

      "What we told the owners was that the three players are totally, as our system has evolved, within their rights to talk to each other, whether it be at a players association meeting, a collective bargaining meeting, an All-Star Game, an Olympic team.," said Stern "That is not tampering or collusion that is prohibited. However, it may be technical. That's our rule right now, our practice. You're allowed to do that."

      Stern did say that he would delegate the issue to the labor relations committee, which could revisit the issue at a later date.



      Read more: http://sportsillustrated.cnn.com/201...#ixzz0tZL3V91V

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      • #4
        Re: David Stern on Lebron and lockout. Owners want a 30% rollback on first year sa

        Originally posted by graphic-er View Post
        In the end the owners will get their way. The players have had it their way for far to long and the league is showing obvious signs of strain. The players can not be that stupid to think that it can go on like status quo when they look in the stands every game and see less and less people.
        Players understand that and that is why they are submitting proposals (a year out) that are exactly like the CBA they have right now. If the players really thought they could keep the current system, they would be submitting proposals that were more player friendly. Just negotiations.

        Comment

        • #5
          Re: David Stern on Lebron and lockout. Owners want a 30% rollback on first year sa

          Originally posted by Unclebuck View Post
          There is more recent salt in this wound, too, as the funny money being doled out to free agents this summer has somehow managed to unify both camps even further. One source described the owners' current mood as "militant," while the players have grown even less willing to hear proclamations of relative poverty (Stern now says the projected losses are $370 million for last season) when players like Darko Milicic are signed to $20 million deals.
          It is laughable to hear that the owners' current mood is militant. How can you whine and cry about being broke, but then give guys like Darko, Joe Johnson and others ridicilous amounts of money? How does a draft bust like Darko get 20 million?

          A hard cap does need to be implemented and the contracts do need to come down, but the owners did nothing to help their cause this offseason. If things are so dire to need these drastic changes they should have played hard ball with the free agents.

          I have pretty much come to terms with the fact that the NBA will have a lockout and the NFL owners and players will get so damn greedy and will have one as well.

          Comment

          • #6
            Re: David Stern on Lebron and lockout. Owners want a 30% rollback on first year sa

            Originally posted by thewholefnshow31 View Post
            It is laughable to hear that the owners' current mood is militant. How can you whine and cry about being broke, but then give guys like Darko, Joe Johnson and others ridicilous amounts of money? How does a draft bust like Darko get 20 million?

            .
            that is explained (rather well IMO) in both of the linked articles. Owners, teams, GM's cities are encouraged to use the system to their own competitive advantage. And that is exactly what is going on this summer. That is a separate issue from the CBA - the CBA sets the rules, and it governs how the teams can go about signing players.

            The point is lets say the Hawks draw the line - JJ is not worth that much money - we aren't going to give him that $$. So JJ leaves the Hawks. That hurts the hawks franchise on the court - they wouldn't be as good a team. Another team would have signed JJ because they are trying to win too. The owners want teh system changed so the Hawks can keep their best player and still be a money maker

            I see the owners point and I think it is a good point. Why isn't that understandable. Maybe it isn't being explained well.

            If the owners would have played hard ball with the free agents, then they would have been accused of collusion. Or how do you police every owner - impossible to do so except through the CBA
            Last edited by Unclebuck; 07-13-2010, 10:19 AM.

            Comment

            • #7
              Re: David Stern on Lebron and lockout. Owners want a 30% rollback on first year sa

              There is no reason to believe the financial numbers the NBA is putting out there. These owners didn't get to be successful by tossing money out the window. If you are losing money hand over fist you do not hand 20 million of it over to Darko Milicic.

              This will be an ugly battle without some open accounting of team finances or at least a 3rd party to make sense of it all. In this bad economy I know that the owners are not making the money they are accumtomed to making. To claim that they lost $370 million for last season... well, they aren't acting like it.

              If my bank account is overdrawn I am hoping that there is rice and beans in the cabinet. I stop going to Ruth's Chris for filet and Dom Perignon. Choosing to let Dark walk would have not affected Minnesota one iota. I can more understand Joe Johnson, but come on. The owners are spending funny money and we are supposed to cry for them?
              Last edited by Slick Pinkham; 07-13-2010, 09:48 AM.
              The poster "pacertom" since this forum began (and before!). I changed my name here to "Slick Pinkham" in honor of the imaginary player That Bobby "Slick" Leonard picked late in the 1971 ABA draft (true story!).

              Comment

              • #8
                Re: David Stern on Lebron and lockout. Owners want a 30% rollback on first year sa

                In the article that Brad posted, I think this is the key paragraph

                "Part of the problem with the existing system is it's based largely on revenue, not net revenue," said deputy commissioner Adam Silver. "Although our actual revenue numbers were better than what we projected, it came at a large cost. Our teams did a spectacular job in a down economy of increasing ticket sales, but that came at the cost of additional promotions, additional marketing, additional staff. They largely made up for a reduction in season ticket sales by selling more individual tickets."
                That explains why attendance and revenue went up, but net revenue went down and how the league as a whole could have lost $370 M

                Comment

                • #9
                  Re: David Stern on Lebron and lockout. Owners want a 30% rollback on first year sa

                  The owners' proposal calls for first-round picks to have their salaries cut by about one-third, would reduce the minimum salary by as much as 20 percent, and would guarantee contracts for only half their value. The total value of a maximum salary would drop significantly, as would the number of years players could sign for.
                  Will the owners make their case strictly by saying they can't afford the old salaries?

                  Is there something owners can give back in exchange for these concessions from the players?
                  And I won't be here to see the day
                  It all dries up and blows away
                  I'd hang around just to see
                  But they never had much use for me
                  In Levelland. (James McMurtry)

                  Comment

                  • #10
                    Re: David Stern on Lebron and lockout. Owners want a 30% rollback on first year sa

                    Originally posted by Putnam View Post
                    Will the owners make their case strictly by saying they can't afford the old salaries?

                    Is there something owners can give back in exchange for these concessions from the players?
                    interesting question: what can the owners give back or give up to the players? I don't know, I'm trying to think back what was before 1999 because the owners got several concessions from the players back then. Contracts were shortened by 1 year, I don't remember the rest. Owners got what they wanted but just not to the degree that they wanted.

                    I was trying to find a good article about the 1999 lockout - but couldn't. I know it hurt a few players career - Shawn Kemp was never the same after, nor was Vin Baker.
                    Last edited by Unclebuck; 07-13-2010, 10:03 AM.

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                    • #11
                      Re: David Stern on Lebron and lockout. Owners want a 30% rollback on first year sa

                      One issue is when many of the teams are not doing well they come to the cities with
                      threats of moving and wanting more hand outs. The current business model is broken and cities will start pushing back. Many cities are running in red ink. People are losing jobs.
                      {o,o}
                      |)__)
                      -"-"-

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                      • #12
                        Re: David Stern on Lebron and lockout. Owners want a 30% rollback on first year sa

                        I personally think that the salary structure as it exists right now could work with the simple addition of a total ban on guaranteed contracts beyond a certain number of years (3?). Or the guarantee could only be triggered by performance clauses. Too many teams are playing lots of players to sit there like Tinsley for us, Eddie Curry, Marbury, etc. Earn that contract, sure, but then don't just quit.

                        Which would be more palatable for players, a loss of guaranteed money or a salary rollback? You would have to limit the amount of signing bonus too, since players would use that to get around the lack of a guarantee. Lets say that contracts can only be guaranteed beyond a 3rd season by reaching hard-to-achieve performance incentives in line with or exceeding their past production and signing bonuses can be no more than 10% of the first three years' guaranteed salary total.
                        The poster "pacertom" since this forum began (and before!). I changed my name here to "Slick Pinkham" in honor of the imaginary player That Bobby "Slick" Leonard picked late in the 1971 ABA draft (true story!).

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                        • #13
                          Re: David Stern on Lebron and lockout. Owners want a 30% rollback on first year sa

                          As I understand it, the NHL "rollback" was a 24% salary cut, across the board on all existing contracts. The "first-year" meant it happened immediately after the CBA was ratified, not that it was delayed until 2012 or something. To be clear, it impacted entire contracts, not just one year of it.

                          The interesting part about it is, in the case of the NHL lockout, it was the players who first proposed it, and kept proposing it. Of course, one could argue that the NHL was in much more dire shape, and this was necessary to fit teams under the new salary cap, where one had not existed before.

                          As bad as '98 was, this seems much more drastic. Of course, one could argue that's necessary, the current economic landscape is a wasteland compared to the booming late '90's. However, '98 was settled because of divisions in the players association. It was felt that the new deal only really impacted the highest paid players, and the rank-and-file rebelled. An across the board 1/3 cut will affect everyone, and that'll be a lot harder to swallow.

                          IOW, considering how close '98 came to losing the whole season, I would not be the least bit surprised if there is no 2011-12.

                          [edit] Regarding "the owners aren't acting like it", I'd beg to differ. I would argue that they're acting exactly like they expect these salaries to be cut in one way or another. Even if there isn't a rollback, a 4-year $30M contract isn't so bad when you don't pay a year of it.
                          Last edited by Kegboy; 07-13-2010, 10:08 AM.
                          Come to the Dark Side -- There's cookies!

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                          • #14
                            Re: David Stern on Lebron and lockout. Owners want a 30% rollback on first year sa

                            Originally posted by thewholefnshow31 View Post


                            How does a draft bust like Darko get 20 million?

                            Adam Morrison is a bust, Darko isn't. Granted Darko hasn't produced as well as a top lottery pick should, but far better than Adam Morrison. Dunleavy has not produced as well as where he was drafted either.

                            7 mil a year is not overpaid for Darko, especially if you look at Foster being paid 6.6 mil for what he produces, that is when he's not injured. Your point would have been better made about ridiculous contracts by pointing out Amare and Johnson's max contracts, especially Amare's with his history of injuries.
                            Last edited by Justin Tyme; 07-13-2010, 10:10 AM.

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                            • #15
                              Re: David Stern on Lebron and lockout. Owners want a 30% rollback on first year sa

                              I wonder if there will ever be a scenario where each team, limit one per year/season, could "cut bait" on a player, resulting in the player receiving 100% of their money, but 0% of it going against the team's salary cap (allowing them to be more competitive immediately if the owner is willing to spend the extra cash).

                              I definitely think we need a "franchise tag" similar to the NFL to give small market teams a better chance at competing with the big boys.

                              I think slicing off another year on new contracts would help in the mistake-erasing department, though the downside is the star players you want to keep become free agents more often.

                              Also, doesn't it seem like a no-brainer that the cap and tax should be based on net revenue versus just plain revenue?

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