The NBA wants to make up for lost time and money – with the emphasis on the money – in the post-pandemic era. In order to do so, league executives are floating a plan that will remind sports fans of international soccer and entertain them before the all-important NBA playoffs.
The NBA projects that television money will soon explode
Going from March 2020 to deep into the recently concluded regular season with few if any fans in the stands cost NBA teams big money. The expense of operating the bubble at Disney World in Florida made it worse. The saving grace was the league was able to deliver nearly complete regular-season schedules the past two years and conduct full sets of playoffs.
However, maintaining the status quo isn’t going to make back the money that owners lost. Some of it could be recouped within three years, which is the likely scenario for adding two expansion teams. Estimates vary, but each of the existing teams should pick up at least $130 million.
The NBA wasn’t in a hurry to grow, having gone without expanding since the Charlotte Hornets in 2004, because doing so divides the national television revenue into smaller pieces.
It’s the vision of what the next TV contract might look like that has owners agreeable to the idea of adding partners shortly. Front Office Sports reports that the NBA envisions replacing the current nine-year contracts totaling $24 billion with a nine-year, $75 billion package beginning with the 2025-26 season.
NBA executives are toying with starting an in-season tournament
Commissioner Adam Silver might be overly optimistic in thinking the NBA can average more than $8 billion a year in contracts with Disney (ABC and ESPN) and TNT, or whichever networks successfully bid on the next contracts. And the existing inventory – 82 regular-season games plus playoffs – isn’t enough to move the needle that much.
So, the league is studying adding in-season tournament similar to international soccer. Front Office Sports reported that current discussions center upon a modest eight-team, single-elimination event. Players from the winning team would earn $1 million apiece, though it’s not clear if that’s enough incentive for stars. LeBron James and Chris Paul have already made hundreds of millions.
The length of the regular season could move from 82 games to 78, but the website said individual teams would lose $5 million to $8 million apiece in home-game revenue. The question then becomes whether an in-season event similar to the FA Cup in English soccer could generate $200 million or more to make it worthwhile.
CNBC reported that the NBA was also looking at a more elaborate tournament system possibly beginning with pool play before cutting the field for a single-elimination tournament of perhaps 16 teams. In theory, the pool play might not affect the regular season; records could be based upon the first home and road games against each division rival in the first quarter of the season.
The league has already tinkered with the postseason
The WNBA is experimenting this season with a more modest variation of the in-season competition with a total prize pool of just $500,000, and the NBA will be watching closely.
Already, the NBA tried something new this season with a play-in round between the end of the regular season and the start of the conference playoff quarterfinals. The seventh through 10th seeds in each conference played down to a pair of qualifiers for the traditional playoffs, and it was a much-needed TV ratings success.
With regular-season ratings on ESPN, ABC, and TNT down by 27% from the 2018-19 season, according to CNBC, the league needs whatever ammo it can bring to negotiations with the networks for the next contract.
An in-season tournament might be the kind of juice the NBA needs.