1% Beats the 2% And The NBA Season Is Back On

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Monday, November 28, 2011

GoLocalProv Sports

The NBA strike looks like it will be over and games will air on Christmas. The subtext of the strike is that a group of billionaires took about a billion dollars off a group of millionaires. While American's are watching the Occupy movement and the attention to the extreme compensation earned by corporate America, the NBA owners are lead by billionaires. New Jersey Net owner Mikhail Prokhorov has a net worth of $19.5 billion. According to USA Today and Forbes, ten of the NBA owners have net worth in excess of $1 billion. 

The Owners

Our Celtics ownership group is lead by managing partner Wyc Grousbeck, who is a partner in the venture capital firm, Highland Capital. Grousbeck's reported net worth is just $360 million. 

The NBA labor fight delayed the season for a couple of months shifted an estimated $1 billion in revenue from the players to the owners. The owners claimed they just could afford to own teams without the relief.

The Players

The message that the average American fans received is that these super rich owners are in need of relief from their millionaire players. Certainly, the players are hardly sympathetic characters - the average NBA salary exceeds $5.1 million per season. NBA superstar Kobe Bryant earns $24.8 million per season. And, our own Celtic, Kevin Garnett earns more than $18 million a season. The fans who purchase the tickets, the jerseys or the cable TV packages will receive nothing in the settlement. The biggest component of the deal is the reapportionment of dollars.

Revenue split: According to Yahoo sports, "The players will receive between 49 percent to 51 percent of basketball-related income based on revenue projections. The split is set on a base case of 50 percent, with the players receiving 60.5 percent of every incremental dollar beyond the targeted amount."

Fans lost two months of games and somehow the decrease in costs that the players passed back to the owners will never be shared with the fan. The distortion of the economics of professional sports seems reflective of so much that Americans are concerned about today - greed.

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