OPENING TIP
The NBA never sleeps. If it wasn’t the weird results (Knicks over Celtics by 30 anyone?), it was everyone wanting to get a peek at the new look Nets (who looked pretty good). That everyone apparently included Kyrie Irving, who re-appeared and announced that he had “just needed a pause.”
But somewhat overshadowed in all this was that Adam Silver continues to talk as though NBA expansion is on the horizon, which would by definition revolutionize the landscape of the league. On Wednesday, Silver commented that a $2.5 billion expansion fee would be “very low” while acknowledging that discussions were ongoing.
This is quite the pirouette from the league after consistently insisting over the years that further expansion did not make sense. Expansion has been off the table since 2004, when the Charlotte Bobcats were added after the Hornets relocated to New Orleans.
The most likely scenario envisions two new teams, with Seattle first in line and then a lot of noise made about Louisville, Kansas City, Pittsburgh, and possibly even Vancouver before the league eventually selects Las Vegas. Adding two teams out west would necessitate one team being moved from the Western to the Eastern Conference, sparking a geography battle royale between Minnesota, Memphis and New Orleans pitting longitude against location relative to the Mississippi River in a quest to jump to the “easier” Conference. Expansion would also require an expansion draft, where as many as sixty players would be plucked from their teams. And let’s not leave out implications for the draft, playoff and lottery seeding, etc. So it becomes hard to overstate what a sea-change expansion might be. The question is: does it make sense?
It’s easy to begin to see the league brass and owners as a monolithic entity,
when it in fact is somewhere closer to an uneasy equilibrium between the league office, large and small market teams, old and new school owners, and ownership groups in totally different financial situations. Glenn Taylor, who is struggling to find a buyer for the Timberwolves at half the number proposed for expansion, wouldn’t mind a giant check on his way out of the league, but Jody Allen might worry about the new Sonics impinging on her Blazers’ monopoly of the Pacific Northwest, while Mark Cuban or Steve Ballmer probably don’t want to give up another 6% of national TV revenues.
The players and their agents add more complexity to the mix. Role players and their agents probably welcome the idea of thirty more roster spots. But top guys will worry about the impact of Basketball-Related Income dilution on the salary cap and a corresponding potential hit to max contract values.
Incentives are all over the board, so how does expansion get done? The traditional refrain from the league and league owners has had three main notes. The first is that expansion would dilute the quality of NBA competition which would in turn diminish product quality and viewership growth. The second was that one-time revenue from the expansion fee was outweighed by the longer term dilution of existing teams’ equity stakes in TV rights and other league revenue. And the third was that the league’s unprecedented success (for an American sport) in attracting a global audience and delivering a compelling digital product meant there was still a long growth runway that existing owners would benefit from without further divvying up North America.
COVID has disrupted that calculus considerably by endangering the near term financial health of the league and team owners. Formerly predictable gate and merchandising revenues are gone, and even TV money is at stake. The NBA’s national TV deal requires the league to deliver at least 72 games, coincidentally the very number to be played this season, but the league’s ability to get that done doesn’t seem like a slam dunk (ahem) these days, given mounting postponements due to the pandemic. So teams are burning cash, turning to their owners for a handout. Yet some owners’ cruise ship businesses, shopping mall kingdoms, and restaurant empires aren’t exactly printing cash themselves of late.
For cash-strapped owners, a $160 million per team windfall that doesn’t need to be shared with the players must seem like manna from heaven. And most players will be happy in general to have more jobs (and hence more job security). So the key will be what bargain the rich teams demand in exchange for bailing out their small-market brethren.
What might be on the shopping list for the Ballmers and Cubans of the world? A few things come to mind. First, further restrictions on tanking. As owners of teams that expect to try to compete every year, they don’t want to reward incompetence or arm future competitors. Second, clear ownership rights on new local revenue streams. From gambling (still very much a state by state proposition) to digital streaming to real estate related projects, the bigger revenue teams want to keep their hands on “their” revenue and avoid sharing with their small-market brethren. Finally, investments in growth. Wealthy teams with long term horizons have lower discount rates and are willing to sacrifice current cash flow for investments that will pay off much later. Could this round of expansion lay the groundwork for a bigger international move later, aimed at growing the pie of fan interest overseas?
Selfishly, we hope the long-termers don’t give in. Part of the reason the quality of play has been so high of late is the high level of talent across the league. Introducing new teams would dilute that average talent level, and play quality would suffer. But in the end we think the almighty dollar wins out, James Harden leads the 2023-24 Las Vegas Showgirls to a first-round playoff loss, and Tilman survives his margin call. Eat at Landry’s!
TWEET OF THE WEEK
We finally have the answer on what happens when an unstoppable object meets an immovable force. Thoughts and prayers to Derrick Favors’ family.
STL INVESTIGATES: SIGNATURE SNEAKERS
STL’s recent investigation of some of the new looks being sported by NBA teams this season was met with universal acclaim, but it was pointed out to us that jerseys are not remotely the most important clothing a player is flossing.
That distinction goes, of course, to the shoes. So this week, STL’s apparel division turns its eye to sneakers.
Currently 16 NBA players have signature shoes, and we present the best, worst and most expensive that are new on offer this season.
Winner:
Kevin Durant's KD13. A lot to like here. The high, throwback collar, subtle turquoise highlights, and the classic white and gold. Even the way the logo disappears into the outsole is funky and cool.
Loser:
James Harden, Harden Stepback 2. It’s good to be bold with color choices on a signature shoe, but this looks like some unholy combination of Miro and Mondrian vomited on your sneakers.
Winner:
Donovan Mitchell’s D.O.N. Issue 2. A great example of being playful without being ugly. The sketched-on graffiti is cool without being self serious and the top panel is left blank so that owners can add their own designs. Fun shoes.
Loser:
Klay Thompson KT6. Thompson characteristically did his own thing when he signed with Chinese newcomer Anta for his shoe line. There have been some nice kicks in this line, but this is not one of them. Unless you’re a power ranger. Then you’re set. Bonus points though for the sneakers website copy, which describes the shoes’s design as “inspired by the combination of water mountain and Thompson's smooth and efficient attack”.
Winner:
Chris Paul CP3.XII. Unbelievably clean lines, classic color scheme, and an interesting alternating look on either side of the lace keeper. It seems like it might be easy to design something that looks this classic. It isn’t.
Loser:
Paul George PG4. Are you having trouble performing in the playoffs? Perhaps it’s because you have velour zip-up shoes on.
Winner:
Kawhi Leonard OMN1S Jolly Rancher. More proof that you don’t have to play it safe. Kawhi’s a bit of a weird guy, and this is a weird shoe, but the loud colors actually complement each other, and the funky coral pattern on the quarter panel is duplicated on the sole, adding some needed cohesion.
Loser:
Lebron James LEBRON 18. What happened King James? Did the pitch meeting go “I’d like my fans to feel like they are wearing a sexy platform wedge on the court at all times.” If so, mission accomplished.
AT THE BUZZER
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Kevin Porter has been listening to too much Kanye West
How the Harden trade could have ‘saved’ Caris LaVert