NBA Franchises Are Not Businesses

Discussion in 'Pistons and NBA' started by pass99, Aug 23, 2011.

  1. pass99

    pass99 Team Captain Forum Donor

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  2. coynejeremy

    coynejeremy All-Star Administrator 1x Fantasy Champion Forum Donor

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    I saw this, too. "Like."
  3. brofmfa

    brofmfa Bench Warmer Forum Donor

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    Great link, thank you sir. The analogy was enlightened.
  4. TaS

    TaS All-Star Forum Donor

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    Still seems like a business to me.

    Pseudo monopoly with high barriers to entry, employees are young and get paid a lot of money, and their customers are loyal/ obsessively engaged.

    Sounds like Google, Facebook, Apple (except for the sweatshops), and many others.
  5. max

    max All-Star

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    Wew that's a read. There are better ways to make money and I don't think anyone buys it for the investment purposes. But it is still a business all the same and business has never been better - for a few teams. For the rest of the over bloated league in unsustainable markets business is not very good at all and slashing salaries is the only way to go for them.

    Perhaps the appropriate question is not why did you buy the team but why is there a team in that city in the 1st place.
  6. Laimbrane

    Laimbrane All-Star Forum Donor

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    It's an interesting perspective, but a stupid argument. Being an emotional investment does not in any way disqualify it from being a business. Not only that, but it's a very good business, because almost all franchises eventually sell for more money than they were purchased for, and any money "lost" is typically only lost in terms of accounting tricks.

    That being said, understanding that the emotional attachment owners have to their company will certainly help players and fans understand the lockout; the owners don't necessarily want to come out of this with the best long-term business plan, they will also want to come out of it looking like the winners. With the NFL, the courts threw a monkey wrench into their plans with the initial lockout injunction, forcing the owners to play ball with the players and ultimately moving the NFL toward a long-term settlement. We'll see what happens with the NBA, but one thing this whole "emotional attachment" idea causes me to reconsider is the impact of players going and playing overseas. The owners might just say "screw them," especially if this is their beloved toy and not their company that is reliant on the icons of the game to be most successful.
  7. Mogilny

    Mogilny All-Star Forum Donor

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  8. Nemo

    Nemo Hall of Fame Forum Donor

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    The hardest part of being a current owner is the concern about the "future value" of a team. In the last 40 years...most franchises have gone up around 3,000% in value. that's a 30-fold increase in the value of a team. Nowadays...owners will not see that kind of value increase due to economic concerns. Owners must be wary of the trend of franchise value, since that's where most of them realize their ownership financial goals...
  9. del

    del Bench Warmer Forum Donor

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    This is one of the things I like a lot about Australian Rules Football.

    Not sure it would work effectively with the size of the NBA, but the AFL (Australian Football League) clubs are not businesses, but sporting institutions which operate for the members. All profits are put back into the clubs.

    The commission that runs the game is also not-for-profit (although the head of the AFL is probably earning more than the highest paid player in the league). This commission is also responsible for distributing funds through the state leagues all the way down to grass roots footy.

    There is a similar setup/responsibility for the other large sports in Australia such as cricket and rugby.


    I've always wondered, does the NBA have a similar responsibility for the state of basketball in the US?
  10. max

    max All-Star

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    Yea when you think about it they have increased that much. Kind of sounds like a bubble.
  11. Nemo

    Nemo Hall of Fame Forum Donor

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    Only place bubbles are good is in the tub...

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