BY Art Thiel 06:47PM 02/15/2014

NBA’s Silver: Expansion ‘not high on my list’

To the surprise of no one, Adam Silver, in his first state of the league press conference Saturday as NBA commissioner, showed no inclination to offer expansion to Seattle or any market any time soon.

“It’s not on the top of my list,” Silver told reporters gathered for the NBA All-Star Game in New Orleans, responding to a question about international expansion. “That goes for domestic expansion.”

Neither he nor his predecessor, the retired David Stern, have offered much hope of expansion since the NBA voted in May to keep the Kings in Sacramento instead of relocating to Seattle.

“I’m committed to studying it,” Silver said. “But I want to make sure we have a healthy, 30-team league. As powerful as the (collective bargaining agreement) has been, we still don’t have 30 teams that are financially viable.

“My job is to assure that 30 teams are healthy and competitive.”

The NBA has maintained that until a new TV rights-fee deal is negotiated that replaces the one expiring after the 2015-16 season, there is no urgency to further dilute the NBA revenue pie to add up to two more teams.

Negotiations are under way to improve the current deal, whose total value is worth $930 million. If that number were to go up substantially, it’s possible that there would be enough cash to go around to consider expansion — particularly after Seattle investor Chris Hansen upped the price in his bidding for the Kings.

The new owners of the Kings paid $525 million, which was less than the purported $625 million Hansen was willing to pay the team’s old owners. A reasonable guess at the moment would put an expansion fee of at least $600 million, meaning that each of the existing teams would get $20 million in a lump sum. A second team would make for $40 million.

Aside from expansion, the only other option to acquire a team is to buy and relocate an existing franchise. Hansen made it clear after the Kings fiasco that he was not interested in competing again against serious interests within the city to keep the team. The team has to be out of options.

The only city remotely vulnerable to predation is Milwaukee, where the Bucks are in a low-boil argument with local politicians about how to fund a replacement for the 25-year-old Bradley Center, one of the league’s oldest and smallest arenas. Seattle has assumed its usual position as stalking horse for supporters who want politicians to provide public funding to help secure the team.

Meanwhile, Hansen has been quiet. He attended the Seahawks Super Bowl triumph in New York and posted his congratulations on his sonicsarena.com site. His message read in part:

“After celebrating with my kids on the bus ride back to Manhattan, I headed out to a 12th man pub in NYC called Carlow East to celebrate with friends,” he wrote. “We sang and danced and hugged and cried. And for the first time in 35 years, I held my right index finger high in the air and belted out ‘We are the Champions’ in a packed bar full of Seattleites and just thought to myself . . .  “We did it. We finally did it.”

 


YourThoughts

  • Its onlySports(DavidWakefield)

    While being an NBA pawn is clearly no fun at all…50 years from now when the NBA has been back in this market for a lengthy period of time …they will look back on the plus 10 years Seattle Did without the NBA and discover
    that they got along just fine. It looks like the new commish is just a Stern Disciple and that can never bode well at least short term for a new Sonic team to relocate here.

    • art thiel

      He’s a 22-year employee of the NBA who shares much of Stern’s ambitions and practices. But I don’t think he’s as petty and vindictive, for whatever that may be worth.

      • maoling

        Is that like saying he’s only half a horse’s ass?

        • Its onlySports(DavidWakefield)

          Uh ,I think there was some “Jackass”genetics in that last “horse” ….in fact the Stern Stable was housing more like a
          Mutant Jackass…..nicknamed lil petty -N- vindictive.

  • Tian Biao

    the timing just isn’t that good for Hansen. The collective bargaining agreement has helped a lot of teams, so there aren’t as many lame and struggling franchises as there used to be for Hansen to purchase. But it hasn’t helped enough to ensure the viability of some weaker franchises to the extent that the league is strong enough to expand. Not sure about the owners, expansion money vs diluted television revenue divided by two more teams, but that seems like less of an issue. btw whatever happened to the environmental impact statement, or report, or whatever it was on the proposed new arena? wasn’t that due in September? maybe i missed it . . .

    • art thiel

      The draft EIS was released in mid-Sept, the comment period is closed, and the final will be released soon. Then it is virtually guaranteed to be sued for its inadequacy by Sodo-site opponents.

      You’re right about bad timing for Hansen. The NBA right now doesn’t to relocate teams or expand until everyone is break-even.

  • jafabian

    Watching the Olympics and seeing the half empty seating at some of the events makes me chuckle at how the NBA wants these huge 25,000 seats arenas for their teams. They want a packed arena every night for the home team so it shows to TV viewers (where the money really comes from, not from sold out arenas like the NBA claims) just how cool their product is and that YOU, the viewer, should jump on their bandwagon. That simply isn’t realistic for at least half the league, especially at the price of the typical NBA ticket. I see more and more the logic in Barry Acklerly’s reasoning for not wanting Key Arena bigger than what it is. It’s size would have helped the Sonics get thru the lean years which came right when he sold the team, though NBA economics were too much to overcome.

    The NBA should really have about 17,000-20,000 seat arenas for the smaller markets. No one can tell on TV that it’s a smaller arena. The focus should be what does the market said team is in bring to the NBA? The smallest markets in the NBA according to Nielsen are San Antonio, Milwaukee, Memphis (FYI, formerly the Vancouver Grizzlies) New Orleans and (wait for it) OKC. Of the top 15 media markets the only one without an NBA team is the Seattle-Tacoma market. The bottom five in attendance right now are Minnesota, Detroit, Atlanta, Philadelphia and Milwaukee. Right now, I think Silver just doesn’t want to deal with the decision but at some point he’ll have to ask can the NBA afford to ignore the Seattle market? Can they afford to ignore the Hansen/Ballmer/Nordstrom team? in 2011 Sterno said the NBA would lose more than $300 million after losing $390 million the season before. They can’t afford to turn money away, especially when half the teams in the NBA are losing money. If they do it only further illustrates that the NBA is nothing more than a millionaires club and efforts like NBA Cares are nothing more than an oxymoron.

    Hansen will probably have to wait two years before Silver gets out from under Sterno’s influence. Sterno is still in charge even though he’s gone.

    • LennyLuvsLonnie

      It’s about arena amenities more than size. What they’re after is large concourses big enough to hold indoor shopping malls (generating lucrative leasing fees), along with Rolls-Royce level luxury suites in the arena itself (motivating corporations to pony up huge annual contracts).

      In other words, this has nothing to do with watching a basketball game… Key Arena is a fabulous place for that, and only slightly smaller than the much-touted new arena in Brooklyn, which seats only 17,700.

      This list of current NBA arenas shows a median capacity around 19,000, close to the 18,500 proposed for the new arena in Sodo.
      http://en.wikipedia.org/wiki/List_of_National_Basketball_Association_arenas

      For the NBA’s iffy business model, Ackerley built the wrong arena back in 1995, when Portland built the right one. That’s why you don’t find Blazer fans demonizing David Stern.

      • art thiel

        Good point Lenny about the Rose Garden and the Key, as well as the amenities. Bigger than that, however, is the entertainment district around the arena that Hansen wants to own/operate. That’s where the money is, and that’s why Hansen is so opposed to moving his plan to a Seattle Center site. It’s public property right now that he can’t own.

    • art thiel

      Actually, the NBA doesn’t want 25,000-seat arenas now. They know that increasing numbers of people prefer their home big screens or their portable second screens to attending in person. Hansen’s plan calls for 18,000 for hoops, less for hockey. The money increasingly comes from TV. The gate is a much smaller part of the picture.

      Since Stern offered the $300M loss figure, he induced a lockout whose outcome was way in favor of the owners. All teams will break even eventually, especially if the new TV deal is as big as the speculation preceding it.

      And Silver, while he bears less of a personal grudge toward Seattle than Stern, is virtually a clone when it comes to business. And business for the NBA is good — not NFL good, but good.

  • RadioGuy

    Hansen hurt himself twice with Stern and, by proxy, Silver by first publicly upping his own offer for the Kings to $625 million (seemingly trying to force the league’s hand to approve the sale, and nobody forces Stern’s hand without a court order), then by surreptitiously sending money to the anti-arena group in Sacramento and coming up with a lame excuse after he was found out. Again, a move not well-received by Stern/Silver and the other owners. End result: Hansen’s star has fallen a bit within the club he wants to join, even though he singlehandedly has raised the value of every NBA franchise

    This doesn’t mean I don’t think Seattle will be back in the NBA. I do. But the league has its own set of fires to put out with existing franchises first, starting with Milwaukee, and I’m pretty sure they want to avoid a similar fiasco with the Bucks that they had with the Kings (where the only person who came out looking good was Kevin Johnson).

    • art thiel

      Fair points, Radio. Hansen came off as impulsive, and Ballmer’s bully tactics were apparent, too. I don’t think the missteps were deal-breakers, but they will be handy if the owners object to Hansen/Ballmer on a non-public level.

      And no one, including Hansen, wants a repeat of Sactown.

      • RadioGuy

        Agreed. The thing is, if/when the NBA wants back in Seattle, they’ll likely HAVE to deal with Hansen, et al, because they’re the only group that has stepped up on behalf of pro basketball here since Howard Schultz bought the Sonics from Acklerley.

        When Schultz first hung a “For Sale” sign on the Sonics for less than market value to local buyers only, he got zero response. It was only at that point when he opened up the bidding to all comers that the Bennett Gang first appeared on the scene. I am no fan of Howard Schultz and haven’t set foot in a Starbucks (or any coffee shop) for years, but I don’t think he deserves the level of vilification he’s received locally. It wasn’t all his fault the Sonics left.

        • Jared S.

          I don’t have any sympathy for Schultz. No one forced him to buy the team, and after he did he did nothing but talk and write columns for the Seattle Times about how great this was going to be for the fans and the community. He ran the team on the cheap and his efforts to get a second Key renovation were brief and pathetic (in neither the 2005 or ’06 legislative sessions did he offer to even cover the cost overruns). Then he bailed with four years left on the lease despite previous assurances from him and Stern that the team would be here through 2010. He even ignored several counterproposals from the city while he
          was cutting his deal with Bennett. Then of course he sat at the press conference with the balloons and other decorations, and lied about why he was selling the team. Since then he’s tried to project himself and Starbucks as these caring entities fighting for the common man while pretending the Sonics debacle never happened.

          I don’t know how much effort he put into finding a local buyer, or whether Bennett simply outbid everyone else (I’ve heard conflicting stories, and at the very least it appears that the ownership group as a whole was pretty divided on whether to sell or not). But everything I do know about him makes it hard for me to give him any benefit of the doubt.

          • art thiel

            You’re tracking, Jared. It was civic dishonesty. He’ll never admit it. Which is why I would never trust him in any other civic endeavor.

        • art thiel

          But he sold himself as a civic steward of the franchise. When the going got tough, regarding public money for his private venture, he bailed.

          • RadioGuy

            I’m not saying Schultzie was a good owner (he wasn’t) or deserves absolution for his role in the loss of the Sonics (he doesn’t), just that the Sonics’ departure wasn’t 100% his fault: Bennett lied through his teeth about wanting to stay in Seattle and people bought it until it was too late…Local and state politicians provided no real opposition and, in some cases, caused more harm than good…I-91 sent a message to the NBA that they wouldn’t get a new venue like the NFL and MLB received in Seattle…no local buyer stepped up when the Sonics could’ve been bought for less than what the Bennett Gang paid and kept in town…

            Schultzie has blood on his hands, but there’s plenty of blame to spread around.

  • j1012

    I think if Hansen wants to get this arena started within the next year or two, he will have to deal with the NHL which wants to embrace the Seattle region and have been pretty open to it. Question is can MOU be changed and would a NHL ownership group be able to help with the costs.

    • art thiel

      The NHL likes to tease Seattle, but it is less ready to expand than the NBA because of so many teams under water. Yet, the upfront money from a two-team expansion may have greater appeal in the NHL.

      The MOU can be rewritten, but will need support from the city council and Murray, who are increasingly worried about the Sodo site’s viability in the face of better organized opposition.

      • Marcus

        Yes, it’s about the $$$ for the NHL. Unlike the NBA, that will go a long way of convincing them. :)

        • art thiel

          NHL ownership turnover is faster than NBA, which means greater interest in a quick cash infusion, regardless of long-term consequence.

  • mindful

    Do the NBA really matter any more unless we all are to old. Soccer going be the 3rd sport in this country in 10 years , Just look at the video game crowd , FIFA is the number one selling game. So if the NBA want to give the middle finger to high market tv, It is cool.

    Just that there entire generation under the age of 30 that gave up on it and went to a different sport. To soccer just listen to the CoD or online game community about soccer.

    Stern forgot about this country and there is a sport out there that can over take the NBA and it will be cool, since he wanted a global sport, but forgot about the base.