An insight into the reasons behind the NBA lockout: NBA Labour dispute Special Report – Part 2
David Stern, the present commissioner of the National Basketball Association (NBA), is duly accredited for bringing tremendous publicity to NBA during the 1990’s and 2000’s. Due to his fruitful efforts, the NBA revenue increased considerably in the last two decades and NBA is at present one of the most lucrative leagues in USA.
It was this same publicity and increase in franchise earnings that led to team ownership prices reaching sky high. Many multi-millionaire tycoons followed the trend and invested in NBA teams. Some of these owners include Boston Celtics’ owner Wyc Grousbeck, Phoenix Suns owner Robert Sarver, Cleveland Cavalier’s Dan Gilbert and Golden State Warrior's Joe Lacob. They paid heavy amounts to get into the league and being businessmen they certainly wanted higher margins of profits.
Apparently, they are not getting what they expected. They are businessmen trying to maximize their income in any way possible and this caters for the resistance in the owners’ team.
And then there is an issue of the teams having more money and the ones having less. The reason, why the NBA governing body imposed luxury tax was to actually prevent teams from grabbing all the good players in the market and in effect tilting the championships balance on their side.
Obviously nothing is for certain, but previous trends have shown that last four championships were won by teams that spent the most money. For example, the Los Angeles Lakers and the Dallas Mavericks spent the most in the previous three seasons; Los Angeles Lakers won two and the Dallas Mavericks won one championship. This was not the case with these two teams only but five other teams spent more than the prescribed threshold as well. The team owners ultimately faced heavy losses and so are now trying to cover the losses by demanding some more share in the revenue.
One other reason for the lockout was the issue of the already limited NBA revenue. NBA receives its revenue by collecting tax from teams that cross the prescribed threshold – the luxury tax meaning a dollar for every dollar spent over the specified limit. David Stern has reiterated that he wants to triple NBA’s revenue, but the method that has been proposed effectively disposes off the luxury tax. Instead, it will be the player’s pockets that will be emptied if the new proposal takes effect.
The labour issue seems to linger on and on with no certain way around it in the near future. While some say there might be a late start to the season, others predict that there might not be a season at all. However one thing is for sure that we will not be seeing the basketball court anytime soon.
However, on a more optimistic side, there still is some decree of hope left and one can pray the players and owners might just stop being so stubborn and think of a solid solution that could correct the current scenario and also may not lead to more issues in the years to come. Fans out there surely miss all the fun!
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